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HomeMy WebLinkAboutSitka Takatz Lake Hydro Grant Application Package Round IV Alaska Energy Authority Application for Renewable Energy Grant Takatz Lake Project – Alaska SUBMITTED BY City and Borough of Sitka Electric Department September 2010 Grant Announcement and Instructions Resolution 2010-21 Grant Application Cost/Benefit Worksheet Grant Budget FERC Documentation Sitka Electric System Load Forecast Sitka Load vs Resource Projections Key Personnel Key Consultants Maps & Drawings Attachments AEA Renewable Energy Grant Fund Application Round IV Page 1 of 25 9/10/10 Renewable Energy Fund IMPORTANT NOTICE Requests for Grant Applications (RFA) AEA11-005 for Renewable Energy Grant Program RFA ISSUE DATE: July 21, 2010 Interested applicants that want to be notified of updates or changes to the Renewable Energy Grant request for Applications MUST follow the directions below; otherwise we will be unable to notify applicants of possible addenda to this RFA. To receive email notices regarding the Renewable Energy Fund Grant Program, click on the link below to the State of Alaska List Server; scroll down until you find Renewable.energy.fund.grants click ‘Join’ and follow the instructions. (State of Alaska List Server) Public Records Notice to Applicants: • 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. • In accordance with 3 AAC 107.630 (b) Applicants may request certain information be kept confidential subject to review and approval by the Authority. • All applications received will be posted on the Authority web site after final recommendations are made to the legislature. Return to: Grant Manager: Butch White Alaska Energy Authority 813 West Northern Lights Blvd. Anchorage, AK 99503 FAX: (907) 771-3942 Phone: (907) 771-3048 E-mail: re_fund@aidea.org Applications are due at the Alaska Energy Authority office by 5PM Alaska Time on Wednesday, September 15, 2010. Page 2 of 25 9/10/10 Table of Contents 1. Introduction and Instructions .................................................................................................. 4 1.1 Purpose ................................................................................................................................................ 4 1.2 Introduction ....................................................................................................................................... 4 1.3 Government Roles and Responsibilities .................................................................................. 4 1.4 Eligible Applicants ........................................................................................................................... 5 1.5 Eligible Projects ................................................................................................................................ 5 1.6 Public Benefit .................................................................................................................................... 6 1.7 Filing an Application ....................................................................................................................... 6 1.8 Application Deadline ...................................................................................................................... 7 1.9 RFA Project Web Site ...................................................................................................................... 7 1.10 Questions about the RFA ............................................................................................................... 7 1.11 Modifications of the RFA ............................................................................................................... 7 1.12 RFA Schedule ..................................................................................................................................... 8 1.13 Grant Regulations ............................................................................................................................ 8 1.14 Grant Funding Program Targets ................................................................................................. 8 1.15 Grant Funding Project Limits ....................................................................................................... 9 1.16 Grantee Reimbursement ............................................................................................................... 9 1.17 Pre-Award Obligations and Reimbursement ......................................................................... 9 1.18 Applicant Match ............................................................................................................................. 10 1.19 Application Preparation Costs ................................................................................................. 10 1.20 Application Content Requirements ........................................................................................ 10 1.21 Authorized Signature ................................................................................................................... 11 1.22 Applicant's Certification ............................................................................................................. 11 1.23 Correction, Modification or Withdrawal of Applications ............................................... 11 1.24 Review of Applications - General ............................................................................................. 11 1.25 Public Notice and Recommendations to the Legislature ................................................ 12 1.26 Notice of Intent to Award a Grant ............................................................................................ 12 1.27 Grant Agreement ........................................................................................................................... 12 1.28 Failure to Proceed ......................................................................................................................... 12 2. Project Requirements ................................................................................................................ 13 2.1 Project Management Requirements ....................................................................................... 13 2.2 Project Phase Descriptions ........................................................................................................ 13 2.3 Phase I– Reconnaissance Requirements .............................................................................. 14 2.4 Phase II Feasibility Analysis, Conceptual Design Requirements ................................. 15 2.5 Phase III Final Design and Permitting Requirements ...................................................... 16 2.6 Phase IV Project Requirements – Construction ................................................................. 17 3. Grant Requirements ................................................................................................................... 18 3.1. Declaration of Public Benefit (Ref 3 AAC 107.605) ........................................................... 18 3.2. Grantee Project Manager............................................................................................................ 18 3.3. Approval to Proceed With Next Phase ................................................................................... 18 3.4. Contracts for Engineering Services......................................................................................... 19 3.5. Site Control ...................................................................................................................................... 19 3.6. Permits .............................................................................................................................................. 19 3.7. Exclusion of Existing Environmental Hazards .................................................................... 19 3.8. Environmental Standards .......................................................................................................... 19 3.9. Current Prevailing Rates of Wage and Employment Preference ................................. 19 3.10. Construction Plans and Specifications Review ................................................................... 20 3.11. Construction Contractor Insurance and Bonding ............................................................. 20 3.12. Post Construction Certification ................................................................................................ 20 3.13. Ownership of Facilities ............................................................................................................... 20 Page 3 of 25 9/10/10 3.14. Operation and Maintenance of Facilities .............................................................................. 20 3.15. Performance/Operation and Maintenance (O&M) Reporting ...................................... 20 3.16. Tariffs & Rates for Use of Grant-Funded Assets ................................................................. 21 3.17. Grant-Funded Assets Not Included in PCE ........................................................................... 21 4. Application Evaluation Process ............................................................................................. 21 Stage 1 Review: Completeness and Eligibility .................................................................................... 22 Stage 2 Review: Project Feasibility and Benefits ............................................................................... 22 Stage 3 Review - Evaluation of Individual Applications ................................................................... 24 Stage 4 Review: Final Ranking Recommendations ........................................................................... 24 5. Appendices ................................................................................................................................ 25 Application Form ............................................................................................................................................ 25 Project Cost Worksheet ............................................................................................................................... 25 Budget Form and Instructions ................................................................................................................... 25 Standard Grant Agreement ......................................................................................................................... 25 Authorized Signers Form ............................................................................................................................ 25 Page 4 of 25 9/10/10 1. Introduction and Instructions 1.1 Purpose Pursuant to Chapter 31 Session Laws of Alaska 2008 (referred to below as the program legislation), which establishes the renewable energy grant recommendation program in Alaska Statute AS 42.45.045, the Alaska Energy Authority (“AEA” or “Authority”) is soliciting competitive applications from qualified applicants for the purpose of recommending grants for renewable energy projects to be funded by the Alaska State Legislature. Applications will be accepted and evaluated in accordance with AS 42.45.045, 3 AAC107.600 – .695 and this Request for Applications (RFA). 1.2 Introduction This RFA sets out the purpose, instructions, requirements, evaluative criteria, and other information on submitting an application to the Authority for recommendation for grant funding. This RFA is organized as follows: Section 1: Introduction and Instructions – describes program and procedural requirements for preparing and submitting an application. Section 2: Project Requirements – describes project information that is required to be discussed in each application. Section 3: Grant Requirements - describes specific grant terms and conditions related to this program. Section 4: Application Evaluation Process and Criteria – describes the criteria that will be used to evaluate and rank each application. Section 5: Appendices – provides additional reference material to assist in application preparation, application forms, grant documents, and applicable law. Accompanying this RFA are Application Forms and Instructions to use in preparing your application for a Renewable Energy Fund Grant. 1.3 Government Roles and Responsibilities The Alaska Legislature established the Renewable Energy Grant Fund and the Renewable Energy Grant Recommendation Program in Chapter 31 SLA 2008, which the legislature enacted in 2008. This bill included a new statute, AS 42.45.045, outlining the program and giving the Alaska Energy Authority responsibility for administering the program. The legislature is responsible for final approval and funding of all grant projects. The Authority is a public corporation of the State of Alaska with the purpose to promote, develop, and advance the general prosperity and economic welfare of the people of the State by providing a means of financing and operating power projects and by carrying out the powers and duties assigned to it. AS 42.45.045 gives AEA the authority to solicit applications for projects, develop and implement regulations, and recommend grants for renewable energy projects to the legislature. The Authority also has adopted regulations under 3 AAC 107.600 – .695 for the purpose of implementing this program. Click here for a copy of these regulations or go to www.akenergyauthority.org Page 5 of 25 9/10/10 An Advisory Committee has been established for the Authority to consult with in the final ranking of applications. The AEA Grant Manager is responsible for accepting applications, coordinating the evaluation of all applications, and developing the list of grant projects to be recommended to the Legislature. An AEA Project Manager will be assigned to assist each grantee whose application is selected for grant funding. Tasks and level of the Authority project management will vary according to the project management plan developed under the grant agreement. At a minimum, the AEA Project Manager will clarify grant requirements, review reports and billings, and track progress of the grant project. The Executive Director of AEA or his designee will approve the final grant and carry out all other duties as defined in statues, regulations, and this RFA. 1.4 Eligible Applicants To be eligible for a grant recommendation the applicant must demonstrate formal approval and endorsement of its project by its governing authority (such as board of directors or executive management if it does not have a governing board) and be one of the following types of entities: 1. An electric utility holding a certificate of public convenience and necessity under AS 42.05; 2. An independent power producer as defined under 3 AAC 107.695 (a) (1); “ "independent power producer" means a corporation, person, agency, authority, or other legal entity or instrumentality, that is not an electric utility and that owns or operates a facility for the generation or production of energy entirely for use by the residents of one or more municipalities or unincorporated communities recognized by the Department of Commerce, Community, and Economic Development for community revenue sharing under AS 29.60.850 - 29.60.879 and 3 AAC 180.” 3. A local government; or 4. A governmental entity (which includes tribal councils and housing authorities). In accordance with 3 AAC 107.610 an applicant must also be able to demonstrate that they will take ownership of the project; own, lease, or otherwise control the site upon which the project is located; and upon completion of the project operate and maintain it for its economic life for the benefit of the public. Applications whose applicants do not meet these requirements will be rejected without further evaluation. 1.5 Eligible Projects The Authority may recommend grants for feasibility studies, reconnaissance studies, energy resource monitoring, and/or work related to the design and construction of an eligible project. Applications for projects that are not within the scope of eligible projects will be rejected without further evaluation To be eligible for a grant recommendation the applicant’s project must: 1.5.1. Be a new project not in operation on August 20, 2008 or an addition to an existing project made after August 20, 2008. and 1.5.2 Be a project that generates energy from or involves the direct use of: Page 6 of 25 9/10/10 • wind, solar, geothermal, waste heat recovery, hydrothermal, wave, tidal, river in- stream, hydropower; or • low-emission nontoxic biomass based on solid or liquid organic fuels from wood, forest and field residues, or animal or fish products; or • dedicated energy crops available on a renewable basis; or • landfill gas and digester gas. “Direct use of energy” means that it either uses renewable energy to generate energy or to make fuel used to generate energy. (3AAC 107.615) Or • be a facility that generates electricity from fuel cells that use hydrogen from renewable energy resources or natural gas. Or • be a natural gas project (other than landfill or digester gas) that benefits a community that: • has a population of 10,000 or less; and • does not have an economically viable renewable energy resource that it can developed. Or • be a transmission or distribution infrastructure located in Alaska that links an eligible renewable energy project or eligible natural gas project to other transmission or distribution infrastructures. (An applicant requesting a grant for transmission or distribution infrastructure is not required to be involved in the financing or construction of the renewable energy project or natural gas project it may be connecting.) • Waste heat recovery systems associated with new fossil fuel-fired systems are not eligible for funding. 1.6 Public Benefit In accordance with 3 AAC 107.605 an application for a grant from the Renewable Energy Fund has to be for the greatest public benefit. Therefore, an independent power producer must provide power based on a cost-based rate, rather than an avoided-cost rate. 1.7 Filing an Application Applicants must submit two (2) hard copies of their complete application, including appendices that can be duplicated, and one electronic version on CD in PDF or other word searchable document electronic format in a sealed envelope(s) clearly labeled: From: Applicants Return Address To: Alaska Energy Authority AEA 11-005 Renewable Energy Grant Application 813 West Northern Lights Blvd Anchorage, AK 99503 Phone: 907-771-3000 Page 7 of 25 9/10/10 1.8 Application Deadline All applications must be received by the Authority no later than 5:00 pm Alaska Time September 15, 2010. The Applicant is solely responsible for complete and timely submission of its application. The Authority accepts no responsibility for submission of applications or for applications that are received after the Application deadlines, whether because they were misdirected, delayed, or erroneously addressed or for any other reason. Failure to meet the deadline will result in the application being rejected. 1.9 RFA Project Web Site The Alaska Energy Authority web site at www.akenergyauthority.org has been set up to make information available to the public regarding the program. The site contains the following information and documents: • The RFA • Application and Grant forms • A summary of relevant questions received regarding the RFA and responses • Clarifications and addenda to the RFA • A list of all applications received (upon completion of the review and ranking process) • Status of applications received upon completion of each review stage (upon completion of the review and ranking process) • PDF versions all applications received (upon completion of the review and ranking process) 1.10 Questions about the RFA Applicants should carefully review all documents and the Authority web site prior to contacting the Grant Manager with questions. Any questions regarding the RFA or grant documents should be directed to: Grant Manager: Butch White Alaska Energy Authority 813 West Northern Lights Blvd Anchorage, AK 99503 Phone: (907) 771-3048 Fax: (907) 771-3942 E-mail: re_fund@aidea.org Questions that require clarification or interpretation of this RFA that the applicant cannot answer by careful review of the RFA should be submitted in writing (letter or e-mail) no later than 10 business days before the September 15, application due date. The Grant Manager may contact the applicant directly by phone or e-mail to respond to non- material questions. The Grant Manager will post the answer to material questions on the Project website. 1.11 Modifications of the RFA Applicants may submit written requests for modifications to this RFA to the Grant Manager no later than August 25, 2010. Please be advised that the Authority cannot modify requirements of Statutes AS 42.45.045 or regulations 3 AAC 107.600 – .695 as it relates to the solicitation. Page 8 of 25 9/10/10 Acceptance or denial of the request is solely in the discretion of the Authority. Failure of the Grant Manager to issue a written modification within 10 days from submittal of request shall be considered a denial of the request. Modifications to this request for applications may be issued at any time prior to the deadline for receipt of applications at the Authority’s option. If modifications are issued within 10 days of the deadline for applications, the application deadline may be extended to allow time for applicants to respond to any changes. All modifications to this RFA will be in writing and posted to the program web site at www.akenergyauthority.org and the Authority will provide e-mail notice to those registered as described on the cover page of this RFA 1.12 RFA Schedule Below is a schedule of critical dates as it relates to this request and award of grants. Actual dates after the application due date are tentative and may vary depending on the number of applications received, the complexity of applications, and timely completion of review by the Legislature. Task Target Dates Application Due Date 9/15/2010 Complete Evaluation of Applications 12/15/2010 Submit Projects for Approval by Legislature 1/28/2011 Projects Approved for Funding (contingent upon legislative action) 5/17/2011 Finalize Award Documents (Contingent upon the Authority receiving all documentation needed for award) 8/1/2011 Actual award dates may vary depending on timing of legislative approval and any modifications that may be required to the grantee’s proposal prior to grant award. 1.13 Grant Regulations Grant regulations, 3 AAC 107.600 – .695, effective 10/16/2009, have been developed and are available for review at: www.akenergyauthority.org 1.14 Grant Funding Program Targets A grant resulting from this RFA is subject to legislative appropriation. The program legislation indicated that the legislature intends to provide $50 million per year from State fiscal year 2009 through 2013 for Renewable Energy Projects under this program. The actual amounts available for the program and for any particular grant are subject to legislative appropriation. Through FY 2011 the Legislature has authorized $150 million in grants that are being awarded as a result of the Authority’s past Request for Applications. The Authority must receive approval from the legislature prior to award of any grant. AEA has established initial funding allocation targets as indicated below as goals in its selection of projects to recommend. The targets are preliminary and subject to adjustment based on the available funding and the type, number, and quality of projects submitted. Page 9 of 25 9/10/10 Project Type Target Allocation – % of Grant $’s Recommended Reconnaissance Study 20% Feasibility/Conceptual Design or Energy Resource Monitoring Final Design and Permitting 80% Construction 1.15 Grant Funding Project Limits In addition to the above program targets the Authority intends to impose limits on the amount of funds that will be available for individual grant projects. The purpose of these limits is to be able to fund more projects statewide and encourage financial participation on the part of the grant applicants. Applicants should take these limits into account when preparing their application as it is expected that the grantee will be responsible for any project costs beyond the grant funds available to complete the project. Project Type/Phase Grant Limits Final Design and Permitting $500,000 or no more than 20% of anticipated construction cost Construction projects on the ‘Railbelt’, Kodiak, Juneau, Sitka, Ketchikan, Wrangell, and Petersburg electrical grids $2 million per project Construction in all other areas of the State not mentioned above $4 million per project The limits are cumulative; including all prior rounds of funding from the Renewable Energy Fund, and are subject to adjustment based on the available funding and the type, number, and quality of projects submitted. 1.16 Grantee Reimbursement Reimbursement to grantees under this program is on a cost reimbursable basis. In accordance with the terms of the grant a grantee is required to submit requests for reimbursements that document commitment, expenditures, and demonstrate meeting milestones identified in the grant. The milestones, with a proposed reimbursement schedule, should be identified in the applicant’s proposal. The final reimbursement schedule is subject to negotiation and will be incorporated into the final grant agreement. The Authority may authorize a percentage of grant funds as an advance payment at the start up of the Grant; however the grantee is still obligated to document all expenditures of grant and matching funds including any advance payment in subsequent requests for reimbursement. The Authority will withhold a percentage 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. 1.17 Pre-Award Obligations and Reimbursement If a potential grantee anticipates award of a grant the grantee may proceed with work on projects prior to award provided: Page 10 of 25 9/10/10 • They do so at their own risk as there is no guarantee projects will be funded or funded at the level requested in their application. • They must have sufficient funds from sources other than this program to meet their project commitments prior to grant award. • The grantee documents all pre-award expenditures including matching fund commitments and when requesting reimbursement for pre-award expenses follows the reimbursement requests requirements in the grant document. • No work performed or obligations incurred prior to July 1, 2011 will be considered for reimbursement. 1.18 Applicant Match When reviewing applications the Authority will favorably consider applications that commit the applicant to provide matching funds to complete the project. Applicants should identify the amount and source of matching f unds or other resources (collectively referred to as “match”) the applicant will contribute to the project based on the total proposed grant project budget. In order for funds to be considered as match, the amount and source of funds must be verified to the Authority. Verification maybe accomplished by submitting a resolution from the applicant’s board or assembly that clearly recognizes the obligation of providing matching funds. Failure to provide this verification will result in no points being awarded for proposed matching funds during the scoring of the application. The proposed matching funds for this project cannot have been used to match a previous grant request. If matching funds or in-kind contributions are proposed, the applicant will be required in the grant award to document the match contribution in their reimbursement requests. If labor or equipment costs are to be presented as matching costs, the proposed rates for the labor or equipment must be approved by the Authority. Previous Renewable Energy Fund grants will not be counted as matching funds. Applicants should note that if matching funds are pledged and budgeted in the grant agreement; but later not provided during the grant project, the grant amount will be reduced accordingly. See the budget form instructions and clarification for matching requirements. 1.19 Application Preparation Costs The Authority shall not pay for any costs incurred by the applicants to prepare and submit their application. No costs incurred by the applicants in preparation of their application may be charged as an expense of performing the Grant. The only reimbursable costs will be those allowed in the grant agreement signed by the Authority. 1.20 Application Content Requirements The application must address all the information required as noted in Section 2 for the type of project proposed. Applicants should download and complete the Microsoft Word application and Excel budget forms provided from the Round IV web site at www.akenergyauthority.org Below is a list of document names and their purpose: Page 11 of 25 9/10/10 Document Name Description Date Software version GrantApp.doc Application Form and Instructions 9/25/09 Word 2003 Costworksheet.doc Application Project Cost Worksheet 9/25/09 Word 2003 GrantBudget.xls Application Budget Form 9/25/09 Excel 2003 GrantBudgetInstructions.doc Instruction for Application Budget Form 9/25/09 Word 2003 Grantform.pdf Example of Standard Grant Form 9/25/09 Acrobat 9 1.21 Authorized Signature Applications must be signed by an individual authorized to bind the Applicant to its provisions and to make the commitments of the application. 1.22 Applicant's Certification By signature on their application, Applicants certify that they are complying and will comply with: 1) the laws of the State of Alaska; 2) the applicable portion of the Federal Civil Rights Act of 1964; 3) the Equal Employment Opportunity Act, the Americans With Disability Act (ADA) and the regulations issued there under by the federal government; 4) all terms and conditions set out in this RFA; and 5) the amount of matching funds being offered. 1.23 Correction, Modification or Withdrawal of Applications An application may be corrected, modified or withdrawn by providing a written request from an authorized representative of the Applicant to the grant manager before the time and date set for receipt of the applications. After applications are opened, modifications may be allowed prior to completion of the evaluation process if the Authority determines that it is in the best interest of the program to allow modifications. Applicants who may be recommended for grant awards may be requested to clarify, modify, or correct their application prior to recommendations being sent to the legislature or prior to award of a grant if the Authority determines that it is in the best interest of the program. Applicants who fail to respond to requests for clarifications, modifications, or corrections within the period specified in the request may have their application rejected or removed from the list of recommended projects. 1.24 Review of Applications - General Applications will be reviewed in four stages by Authority and Department of Natural Resources staff, and consultants. Stage 1 – Completeness and Eligibility Review (3 AAC 107.635) Stage 2 – Technical and Financial Feasibility Review (3 AAC 107.645) Stage 3 – Evaluation of Individual Applications (3 AAC 107.655) Stage 4 – Regional and Final Ranking Recommendations (3 AAC 107.660) The review and evaluation criteria for each stage are listed in Section 4. Applications that do not comply with AS 42.45.045, 3 AAC 107.600 - .695, and all of the material and substantial terms, conditions, and requirements of this RFA may be rejected. If an application is rejected the applicant will be notified in writing that its application has been rejected and the basis for rejection. Page 12 of 25 9/10/10 The Authority may waive minor requirements of the RFA that do not result in a material change in the requirements of the RFA and do not give an applicant an unfair competitive advantage. At any stage in the review process the Authority may request clarifying information and the applicant will have a specified amount of time to respond to the request for information. Failure to respond timely or provide adequate information will result in the application being rejected. If information is sufficient the application will be forwarded through to the next stage of review. 1.25 Public Notice and Recommendations to the Legislature Upon completion of Stage 4 of the review process the Authority will forward to the legislature a summary of all applications received, their status, the technical score and the final rank of all applications. The Authority will also post on its web site the applications, a brief summary of each project, and the final ranking and disposition of all applications. The t otal cost of all recommended projects may be for more or less total dollars than the current funding authorized by the Legislature. Applicants may be required to provide additional information to the legislature upon request. 1.26 Notice of Intent to Award a Grant Upon approval of funding by the legislature for FY2011 grants and signing of the budget authorization by the Governor, the Authority will notify successful applicants of their award. Grantees whose authorizations are less than what was requested or whose scope, schedule, or budget may have changed from when their application was originally submitted will be required to update their application to assure the grant is consistent with the funding available. 1.27 Grant Agreement Applicants whose projects are selected for grant funding will be required to sign a Grant Agreement prepared by the Authority that contain the terms and conditions in the Grant form included as an appendix to this document. The Authority may modify its standard form grant agreement if necessary for this program or for particular projects. 1.28 Failure to Proceed If an Applicant is unable to respond and indicate acceptance of the Grant Agreement within 30 days of receipt of the Grant Agreement or provide an update to its project as may be required; then the offer of the grant may be withdrawn by the Authority. Available grant funds may be offered to another eligible grant applicant subject to availability of funds and consistent with legislative intent. If the Authority and a grantee are unable to complete a grant agreement within one year of the original Notice of Intent to Award a grant, the Authority may suspend negotiations, rescind the grant offer and return the allocated grant funds to the Renewable Energy Fund. [3 AAC 107.670(b)] Page 13 of 25 9/10/10 2. Project Requirements An application under the RFA should describe the Applicant’s renewable energy project in one or more phases as described in this section and include sufficient information to allow for the evaluation and ranking of the application. The depth of information needed with the application will vary depending on the type and complexity of the project, the number of phases for which grant funding may be requested, the amount of state funds requested, and the estimated total project costs. All applicants are required to have a project management plan they intend to follow that includes who is going to manage the project, how it is going to be managed, a schedule with milestones, and how project risks will be mitigated. The level of detail in the plan will vary depending on the project phase(s), amount of funds requested, and complexity of the project. 2.1 Project Management Requirements The Applicant is responsible for implementing and executing a plan for managing the project so that the project is completed within the scope, schedule and budget proposed in the application. Project Management Project Manager The Applicant must designate a project manager(s) responsible for managing the project for the Grantee. This may be: • An employee of the Grantee • A consultant • Or other partners committed to the project. For Example Native corporations, other utilities, IPPs, or government entities. • If not known, the grantee should indicate how they intend to acquire project managers. Project Schedule Schedule for the proposed work that will be funded by this grant. Project Milestones Identifies key tasks and decision points in the project schedule. Project management milestone charts and descriptions of major project decision points are encouraged Project Resources Identifies what people, equipment, or services will be used to accomplish the project. Includes any commitments the grantee may have or reference any existing contracts or the selection process that may be used for major equipment purchases or contracts. Project Communications Identifies how the grantee will monitor the project and keep the Authority informed of the status. Project Risk Identifies potential problems and how they will be addressed. 2.2 Project Phase Descriptions The application should describe the project proposed for grant funding by phase in order to demonstrate a likelihood that the project will be successfully completed and will provide substantial public benefits. Applicants who have completed a project phase will be required to document successfully completing the phase with a positive public benefit for the project prior to the Authority releasing funds for a following phase. Each type of technology may have issues or tasks that are specific to that technology that will need to be addressed in addition to the issues or tasks identified in each phase. Page 14 of 25 9/10/10 Project phases or major project tasks that should be addressed in the applicant’s project description are as follows: Phase I Reconnaissance A preliminary feasibility study designed to ascertain whether a feasibility study is warranted. Phase II –Feasibility Analysis, Resource Assessment, Conceptual Design Detailed evaluation intended to assess technical, economic, financial, and operational viability and to narrow focus of final design and construction. Phase III – Final Design and Permitting Project configuration and specifications that guide construction. Land use and resource permits and leases required for construction. Phase IV – Construction, Commissioning, Operation, and Reporting Completion of project construction and beginning of operations. It also includes follow-up O&M reporting requirements. Included after each phase described here are a list of possible milestones to assist with the preparation of an application. 2.3 Phase I– Reconnaissance Requirements The purpose of a Reconnaissance Study is to determine whether further study is warranted. A study is required to consider and address the information and tasks below. Phase I - Reconnaissance Proposed Energy Resource General description of the extent and amount of the renewable resource Existing Energy System For rural power systems and/or facility heating systems • Basic configuration (number, size, and type of gensets and boilers; efficiency; operating hours) • Capital and replacement costs • Annual O&M cost and schedule • Annual fuel consumption and fuel price • Load information (peak, minimum, average, and future trends) • Plans for system upgrades For all systems • Residential and commercial electrical service rates • Avoided cost of energy Proposed System Design • Description of renewable energy technology specific to project location • Alternative system discussion • Optimum installed capacity • Annual generation • Anticipated barriers • Basic integration concept Proposed System Costs • Total anticipated project cost for this phase • Projected capital, O&M, and fuel costs • Projected debt financing if applicable Project Benefits • Annual fuel displacement and savings over the project life • Annual revenue from energy sales, tax credits, green tags, and other incentives • Discussion of non-monetary benefits Energy Purchase/Sale • Identification of potential energy market • Potential energy purchase and sales rates Page 15 of 25 9/10/10 Land Ownership • Landowner(s) identified and contacted Permits • List of applicable permits • Anticipated permitting timeline • Potential regulatory barriers Environmental Complete environmental screening that addresses: • Threatened and Endangered species and other habitat impacts • Fisheries and wildlife protection • Water and air quality impacts • Wetland and protected areas • Archaeological and historical resource impacts • Land development constraints • Telecommunications and aviation impacts • Visual and aesthetic resource impacts • Other environmental barriers Analysis and Recommendations • Basic economic analysis of alternatives • Recommendations for additional project development work Milestones for a Reconnaissance Project should include. 1. Project scoping and contractor solicitation completed 2. Resource identification and analysis completed 3. Land use, permitting, and environmental analysis completed 4. Preliminary design and cost analysis completed 5. Simple economic analysis completed 6. Final report and recommendations completed 2.4 Phase II Feasibility Analysis, Conceptual Design Requirements Phase II Feasibility Analysis requires a detailed evaluation intended to further assess technical, economic, financial, and operational viability of a project and to narrow the focus of final design and construction. In addition to addressing all the requirements of the Phase I, a feasibility analysis should address the information and tasks below. Phase II –Feasibility Analysis, Conceptual Design Proposed Energy Resource Site-specific assessment of available energy resource following industry standards usually based on field measurements, discussions with resource owners, and other onsite activities. Examples of assessment activities include: • Collection and analysis of meteorological tower data at proposed wind turbine locations • Assessment of geological data from surface investigation and test wells for geothermal and natural gas projects • Stream gauging and hydrological modeling for hydroelectric projects • Analysis of wood and sawmill residue availability and delivered cost to biomass energy project locations Existing Energy System • Annual load profile—power projects may require onsite measurement • Load growth projections • Transmission system layout and capacity • Retirement schedule Proposed System Design • Identification and analysis of system alternatives • Recommended alternative including discussion of impacts on Page 16 of 25 9/10/10 existing system • Assessment of project site, including geotechnical characteristics as necessary • Annual energy production profile • Conceptual system design • Conceptual integration design • Identification of remaining technical barriers Project Costs • Conceptual level cost estimates for final design and construction • Annual O&M and fuel costs • Other project costs including leases, taxes, insurance, and financing Project Benefits • Annual fuel displacement and savings over the project life • Detailed analysis of revenue from energy sales, tax credits, green tags, and other incentives • Discussion of non-monetary benefits Energy Purchase/Sale • Preliminary energy purchase or sales agreement Land Ownership • Assessment of site control requirements for proposed project • Authorization from land owners for onsite feasibility activities Permits • Obtain authorizations from all applicable agencies for any use of land or resources for feasibility activities Environmental • Site-specific assessment of resources that may be significantly affected. Examples include fish and wildlife habitat assessment, visual impact modeling, and air quality assessment. • Plan for addressing potential environmental impacts Analysis and Recommendations • Comprehensive economic and financial analyses of alternatives • Recommendations for project design and construction activities • Draft operational and business plan Milestones for a Feasibility Project should include. 1. Project scoping and contractor solicitation completed 2. Detailed resource assessment completed 3. Permitting and environmental analysis completed 4. Detailed analysis of current cost of energy and future market completed 5. Conceptual design and costs estimate completed 6. Detailed economic and financial analyses completed 7. Conceptual business & operations plan completed 8. Final report and recommendations completed 2.5 Phase III Final Design and Permitting Requirements Building on information gathered in Phase I and II, applicants will be required to complete Phase III prior to construction. The purposes of Phase III are to establish the project configuration and specifications that will be used to guide construction, refine project costs estimates, finalize business plans, and obtain land use and resource authorizations required for construction. Work should address the information and tasks below. Page 17 of 25 9/10/10 Phase III –Final Design & Permitting Renewable Energy Resource • Updated data to confirm that resource is still available Existing Energy System • Final engineered and approved energy system configuration including upgrades Proposed System Design • Final engineered and approved system design • Final engineered and approved integration design • Interconnection study Project Cost • Final engineer’s estimate of project cost Project Benefits • Detailed financial analysis based on chosen business structure and applicable costs, revenues, and incentives Power Purchase/Sale • Executed power purchase/sales agreement Land Ownership • Final land use authorizations obtained Permits • All necessary permits obtained Environmental • All environmental issues resolved Business & Operational Plan • Final operational and business plan Milestones for a Design and Permitting Phase of a project should include. 1. Project scoping and contractor solicitation completed 2. Permit applications completed 3. Final environmental assessment and mitigation plans completed 4. Resolution of land use, right of way issues 5. Permitting, rights-of-way, site control completed 6. Final system design completed 7. Final cost estimate completed 8. Updated economic and financial analyses completed 9. Power or heat sale agreements in place 10. Final business and operational plan completed 2.6 Phase IV Project Requirements – Construction The purpose of the construction phase is to construct and commission the project, begin operations, and provide follow-up reports on operations and maintenance for a specific period of time to document the programs impact on the community. Grantees are expected to cover all costs of operations and maintenance in compliance with their operational and business plans developed in Phase III. The construction phase will address the information and tasks below Phase IV –Construction, Commissioning, Operation, and Reporting Renewable Energy Resource • Continuous monitoring to verify and update projections and system efficiency Existing Power System • Coordination of conversion, integration, or surplus of existing system Proposed System Design • Construction plan and schedule • Commissioning plan and schedule • Modifications to final design during construction Project Cost • Actively track project costs against the project budget • Propose budget modifications as needed • Manage cost overruns Environmental • Environmental monitoring as required Permitting • Reports as required by permitting agencies Page 18 of 25 9/10/10 Analysis and Recommendations • Update business plans and power purchase agreements as needed to account for actual construction costs • Final project report including as-built specifications and drawings, final budget, schedule, and recommendations • Periodic operation and maintenance reports as required by grant including actual O&M, fuel, and equipment costs; O&M measures and schedule; energy output; project availability; conversion efficiency; renewable energy resource; and recommendations. The Authority will work with the grantee to implement this required reporting. Milestones for a Construction project will include: 1. Bid documents completed 2. Vendor selected and award in place 3. Construction – unique to each 4. Integration and testing 5. Decommissioning of old system complete 6. Final acceptance, commissioning and start-up complete 7. Operations reporting 3. Grant Requirements To receive renewable energy grants, applicants must comply with the following standard terms and conditions and the other terms and conditions in the Authority’s standard grant document Reference Exhibit A. Grantdoc.pdf If the grantee is a tribal entity, a waiver of sovereign immunity will be required as a condition of the grant. 3.1. Declaration of Public Benefit (Ref 3 AAC 107.605) The grantee acknowledges and agrees that the Project shall be constructed, owned and operated for the benefit of the general public and will not deny any person use and/or benefit of Project facilities due to race, religion, color, national origin, age, physical handicap, sex, marital status, changes in marital status, pregnancy or parenthood. 3.2. Grantee Project Manager For construction projects, the grantee will contract or hire competent persons to manage all phases of the Project subject to approval by the Authority. Work at a minimum will include: management of Grantee’s labor for the project, engineering firms and consultants, procurement, management of construction contractors, selection of equipment, review of plans and specifications, on-site inspections and review and approval of work, and other duties to ensure that the completed work conforms with the requirements of the grant and the construction documents. If the grantee fails to provide adequate project management the Authority may terminate the Grant or assume project management responsibilities with the concurrence of the Grantee. Costs for a Project Manager must be reasonable to be considered an eligible grant expense. 3.3. Approval to Proceed With Next Phase A grant award may be for one or more phases of a project. The grantee must achieve substantial completion of work or of designated grant milestones and receive approval from the Authority prior to proceeding to the next phase of work. Page 19 of 25 9/10/10 3.4. Contracts for Engineering Services In the event the grantee contracts for engineering services, the grantee will require that the engineering firm certify that it is authorized to do business in the State of Alaska and provide proof of licensing and insurance. 3.5. Site Control If the grant Project involves the occupancy and use of real property, the grantee assures that it has the legal right to occupy and use such real property for the purposes of the grant, and further that there is legal access to such property. The grantee is responsible for securing the real property interests necessary for access and the construction and operation of the Project, through ownership, leasehold, easement, or otherwise, and for providing evidence satisfactory to the Authority that it has secured these real property interests. 3.6. Permits It is the responsibility of the grantee to identify and ensure that all permits required for the construction and operation of this Project by the Federal, State, or Local governments have been obtained unless otherwise stated in Appendix C. These permits may include, but are not limited to, Corps of Engineers’ Wetlands Permit, State Historic Preservation Office, State Fire Marshal approval, rights-of-way and site control, including any necessary Coastal Zone Management coordination through the Division of Coastal and Ocean Management (DNR). 3.7. Exclusion of Existing Environmental Hazards Grant funds will not be awarded for and may not be used for environmental investigation, removal or remediation of contamination, remediation of existing facilities or properties, or any other environmental matters, unless specifically provided in the Grant Agreement. In addition, grant funds will not be awarded for and may not be used for the decommissioning or removal of any existing facilities except as specifically provided in the Grant Agreement. 3.8. Environmental Standards The grantee will comply with applicable environmental standards, including without limitation applicable laws for the prevention of pollution, management of hazardous waste, and evaluation of environmental impacts. 3.9. Current Prevailing Rates of Wage and Employment Preference To the extent required by federal and State law construction projects may require certain grantees to include the requirements for Davis Bacon and Little Davis Bacon when contracting for construction services. This requires contractors to pay minimum rates of pay for specific classes of workers and provide certified payrolls to the State Department of Labor. The current wage rates can be found at the following web sites: The Federal wage rates at http://www.wdol.gov/ The State wage rates at http://www.labor.state.ak.us/lss/pamp600.htm If federal funding sources require federal Davis Bacon compliance, the grantee must use both the Federal and State wage scale and the contractor is required to pay the higher of the State or Federal wage scale. When only State Funds are used that requires “Little Davis Bacon,” the grantee is only required to follow the State Rate schedule. For projects that are only State funded, contractors are also required to use local residents where they are available and qualified in accordance with AS 36.10.150 - .180, and 8 AAC 30.064 - .088. Page 20 of 25 9/10/10 The grantee is responsible for identifying any other sources of project funds and for ensuring compliance with applicable wage scales for all sources of project funding. If a Grantee believes they or their contractors may be exempt from these requirements, they should contact the State of Alaska Department of Labor and Workforce Development, Wage and Hour Administration, for a determination and forward a copy of that determination to the Authority’s Grant Administrator. 3.10. Construction Plans and Specifications Review Prior to public notice of bidding a construction project the grantee will provide the plans and specifications to the Authority for review. Concurrence that the plans and specifications are consistent with the grant award must be received before grant funds will be released for construction related costs. 3.11. Construction Contractor Insurance and Bonding When the value of the construction is anticipated to be greater than $100,000, prior to beginning construction on a project funded by this grant, the grantee or grantee’s contractor(s) must provide the Authority; 1) proof of adequate insurance as defined in Appendix B #4 of the grant agreement, and 2) either a payment and performance bond, as may be required by AS 36.25.010, a surety in form and substance acceptable to the Authority, or some other guarantee or assurance acceptable to the Authority that the grantee or the grantee’s contractor has the capacity, qualifications, and financial resources necessary to complete construction of the project as proposed in the grant or construction contract(s) funded by this grant. 3.12. Post Construction Certification Upon completion of construction the grantee will submit a final report that includes: • Certification that all work is completed in accordance with the grant and all costs claimed are eligible costs and represent work completed on the Project • Summary of total project cost including detailed funding sources and any outstanding debt. • Certification that there is a release of any contractor or subcontractor liens on the project. • Identification of any outstanding construction issues. • As-built drawings 3.13. Ownership of Facilities The grantee shall assume all liabilities arising from the ownership and operation of the project. Grantee will not sell, transfer, encumber, or dispose of any of its interest in the facilities constructed with this grant funding during the economic life of the Project without prior written approval of the Authority. 3.14. Operation and Maintenance of Facilities The grantee is required to maintain and operate the facilities defined in Appendix C of this agreement for the economic life of the facility or the specific period of time designated herein. In the event that the grantee is no longer operating the facilities for the intended purposes the Authority may require the grantee to reimburse the Authority an amount based on the total contribution of the Authority, the value of the assets, and the terms and conditions of this agreement. The Authority may require that the assets acquired under this agreement be sold and the proceeds returned to the Authority. 3.15. Performance/Operation and Maintenance (O&M) Reporting If the grant is for Project construction, the grantee must provide the Authority with a Performance/O&M Report annually for five years after Project completion. The Performance/ O&M Report must include: (1) a detailed description of Project operations and maintenance Page 21 of 25 9/10/10 activities and issues; and (2) a detailed description of Project performance, including energy output, estimated fuel savings resulting from the operation of the Project, and any other relevant measures of Project performance reasonably requested by the Authority, a description of repairs and modifications to the Project, and recommendations for improvements for similar future projects. The Authority may take into account the grantee’s failure to provide the required annual Performance/O&M Report in evaluating future applications from the grantee for grant funds. The Authority encourages grantees to provide annual Performance/O&M reports for the life of the Project, and may consider the grantee’s voluntary submittal of annual Performance/O&M reports beyond the first five years in evaluating future applications from the grantee for grant funds. 3.16. Tariffs & Rates for Use of Grant-Funded Assets Rates for power provided as a result of generation or transmission facilities built with grant funds may be subject to review and approval by the Regulatory Commission of Alaska (RCA), or if the rates are not subject to RCA review and approval, they may be subject to review and approval by the Authority to ensure reasonable and appropriate public benefit from the ownership and operation of the Project. As a condition of the grant, Independent Power Producers will agree to sell energy resources for electricity and heat at a cost-based rate for the economic life of the project. The Authority will hire an independent economist to provide guidance in developing a cost-based rate for electric sales with an appropriate rate of return on equity. The allowable cost-based rate represents the highest rate that the Independent Power Producer will be allowed to charge. Because the cost-based rates are a grant condition, avoided costs rates or Public Utility Regulations Policies Act (PURPA) rates will not apply for projects which obtain grant funding. Application for a Certification of Public Convenience and Necessity (CPCN) is also a grant condition. RCA action related to the issuance of the CPCN must be completed prior to the issuance of any construction grant funding. 3.17. Grant-Funded Assets Not Included in PCE The grantee agrees that it will not include the value of facilities, equipment, services, or other benefits received under this grant as expenses under the Power Cost Equalization Program or as expenses on which wholesale or retail rates or any other energy tariffs are based. 4. Application Evaluation Process Applications will be reviewed in four stages by application evaluation committees, which may include the Authority staff, consultants, and members of the Advisory Committee established under the program legislation. Stage 1 – Completeness and Eligibility Review (3 AAC 107.635) Stage 2 – Feasibility and Public Benefit Review (3 AAC 107.645) Stage 3 – Evaluation of Individual Applications (3 AAC 107.655) Stage 4 – Regional and Final Ranking Recommendations (3 AAC 107.660) The review and evaluation criteria for each stage are listed here. Applications that do not comply with AS 42.45.045, 3 AAC 107.600 - .695, and all of the material and substantial terms, conditions, and requirements of this RFA may be rejected. If an Page 22 of 25 9/10/10 application is rejected the applicant will be notified in writing that its application has been rejected and the basis for rejection. The Authority may waive minor requirements of the RFA that do not result in a material change in the requirements of the RFA and do not give an applicant an unfair competitive advantage. At any stage in the review process the Authority may request clarifying information and the applicant will have a specified amount of time to respond to the request for information. Failure to respond timely or provide adequate information will result in the application being rejected. If information is sufficient the application will be forwarded through to the next stage of review. Stage 1 Review: Completeness and Eligibility All applications received by the deadline will initially be reviewed by Authority staff to assess if the application is complete, meets the minimum submission requirements, and has adequate information to proceed to Stage 2 – Feasibility and Public Benefit Review. The following pass-fail criteria will be used to determine if the application meets the minimum requirements. Application must meet all of these criteria to be considered further. 1. The application is submitted by an Eligible Applicant (sec 1.4). 2. The project meets the definition of an Eligible Project (sec 1.5). 3. A resolution or other formal authorization of the applicant’s governing body is included with the application to demonstrate the applicant’s commitment to the project and any proposed matching funds are available and in the applicant’s control (sec 1.20). 4. The application provides a detailed description of the phase(s) of project proposed i.e. reconnaissance study, conceptual design/feasibility study, final design/permitting, and/or construction (sec 2.2). 5. The application is complete in that the information provided is sufficiently responsive to the RFA to allow AEA to consider the application in the next stage of evaluation. 6. The applicant demonstrates that they will take ownership of the project; own, lease, or otherwise control the site upon which the project is located; and upon completion of the project operate and maintain it for its economic life for the benefit of the public (sec 1.4) If an application is ambiguous regarding questions 1-6, the Authority may request clarifying information and the applicant will have a specified amount of time to provide the requested information. Failure to respond timely or provide an adequate explanation will result in the application being rejected. Stage 2 Review: Project Feasibility and Benefits For all applications that pass Stage 1 the Authority will perform a benefit and feasibility review in accordance with 3 AAC 107.645 and the criteria below: Application must substantially meet these criteria to be 1. Project Management, Development, and Operation a. The proposed schedule is clear, realistic, and described in adequate detail. b. The cost savings estimates for project development, operation, maintenance, fuel, and other project items are realistic. c. The project team’s method of communicating, monitoring, and Page 23 of 25 9/10/10 considered further. reporting development progress is described in adequate detail. d. Logistical, business, and financial arrangements for operating and selling energy from the completed project are reasonable and described in adequate detail. 2. Qualifications and Experience a. The applicant, partners, and contractors have sufficient knowledge and experience to successfully complete and operate the project. b. The project team has staffing, time, and other resources to successfully complete and operate the project. c. The project team is able to understand and address technical, economic, and environmental barriers to successful project completion and operation. d. The project uses local labor and trains a local labor workforce. 3. Technical Feasibility a. The renewable energy resource is available on a sustainable basis, and project permits and other authorizations can reasonably be obtained. b. A site is available and suitable for the proposed energy system. c. Project technical and environmental risks are reasonable. d. The proposed energy system can reliably produce and deliver energy as planned. e. If a demonstration project is being proposed: • Application in other areas of the state, or another specific benefit of the proposed project, is likely; • need for this project is shown (vs. the ability to use existing technology); and • the risks of the proposed system are reasonable and warrant demonstration. 4. Economic Feasibility and Benefits a. The project is shown to be economically feasible (net savings in fuel, operation and maintenance, and capital costs over the life of the proposed project). b. The project has an adequate financing plan for completion of the grant-funded phase and has considered options for financing subsequent phases of the project c. Other benefits to the Alaska public are demonstrated. The Authority may develop a preliminary list of applications that may be technically and economically feasible and request additional information from applicants at this time to confirm a complete understanding of the project proposed. If information is requested, the applicant may be required to provide information within a short time frame to allow for the Authority to continue to the next stage of the review process. Applicants that fail to respond to requests for information or to adequately address the criteria in the technical review may be rejected. Page 24 of 25 9/10/10 If an application for a design or construction project is incomplete to the point that an economic and/or technical feasibility evaluation cannot be completed, or there is no indication of a feasible financing plan that will provide for project funding through completion of construction, the application will not be considered for Stage 3 review. For feasibility and reconnaissance projects, the benefit/cost ratio estimate must be at least a 0.6; otherwise the project will not be recommended for funding and will not be considered for Stage 3 review. For design and construction projects, the benefit/cost ratio estimate must be at least a 0.8; otherwise the project will not be recommended for funding and will not be considered for Stage 3 review. If an applicant has requested funding for multiple phases of work and the benefit/cost ratio is between 0.6 and 0.8, the Authority may recommend a portion of funds be made available to the applicant for reconnaissance or feasibility studies. Stage 3 Review - Evaluation of Individual Applications All applications that pass the technical review will be evaluated for the purpose of ranking applications and making recommendations to the legislature based on the following criteria which include criteria required by 3 AAC 107.655 and AS 42.45.045. Evaluation and Ranking Criteria to be Used for determining applications to recommend to legislature 1. Cost of energy per resident in the effected project area relative to other areas. 2. The type and amount of matching funds and other resources an applicant will commit to the project. 3. A statewide balance of grant funds. (For example, if there is two or more similar competing projects in a given area the Authority may only recommend one.) 4. Economic and technical feasibility (Stage 2 evaluation). 5. Public Benefits including economic benefit to the Alaska Public. 6. Sustainability – the ability of the applicant to finance, operate and maintain the project for the life of the project. 7. Local Support for the project. 8. The readiness of the applicant to proceed with phases of the project proposed for the grant. 9. Compliance with previous grant awards in previous phases of project development. During this stage of review the evaluation team may conduct interviews of applicants to determine a more complete understanding of the technical or financial aspects of their application. Stage 4 Review: Final Ranking Recommendations All applications recommended for grants as a result the Stage 3 evaluation will be ranked in accordance with 3 AAC 107.660. To establish a statewide balance of recommended projects, the Authority will provide to the advisory committee a statewide and regional ranking of all applications recommended for grants in Stage 3. In consultation with the advisory committee the Authority will make a final prioritized list of all recommended projects giving significant weight to providing a statewide balance for grant Page 25 of 25 9/10/10 money, and taking into consideration the amount of money that may be available, the number and types of project within each region, regional rank, and statewide rank of each application. In its final decision on an application the Authority may recommend a grant in an amount for project phases different from what the applicant requested. In recommending a grant for phases different from what the applicant requested, the Authority may limit its recommendation to a grant for one or more preliminary project phases before recommending a grant for project construction. 5. Appendices Application Form Project Cost Worksheet Budget Form and Instructions Standard Grant Agreement Authorized Signers Form CITY AND BOROUGH OF STTKA RESOLUTION NO.2010.21 A RESOLUTION OF THE CITY AND BOROUGH OF SITKA, ALASKA AUTHORIZING A GRANT APPLICATION TO THE ALASKA RENEWABLE ENERGY FI.IND FOR THE TAKATZ LAKE HYDROELE CTRIC FEASIBILITY ANALYSIS Whereas, we are entering an era of increasingly scarce and increasingly expensive oil over the next twenty years and beyond; and, Whereas, Sitka is heavily dependent on oil for heating and transportation; and, Whereas, due to high oil prices Sitka consumers are switching to the altemative of electric heating which has fully utilized Sitka's existing hydroelectric energy supply; and, Whereas, the long range electric load forecast is that Sitka consumers will continue to switch to electric energy for most of their heating and ground transportation needs; and, Whereas, to meet the growth in demand for electric energy Sitka is now developing the expansion of its existing Blue Lake Hydroelectric Project to its maximum capability, which could increase Sitka's hydroelectric energy supply by about 28o/o; and, Whereas, Sitka is committed to reductions in use of hydrocarbons; and Whereas, developing the hydroelectric potential of Takatz Lake could double Sitka's hydroelectric energy supply as well as facilitate the electrical interconnection of other communities in Southeast Alaska with Sitka for the mutually beneficial sharine of renewable energy resources to displace oil; and Whereas , Sitka has made application and received a preliminary permit from the Federal Energy Regulatory Commission (FERC) to determine the feasibility of developing the hydroelectric potential of Takatz Lake and the associated elechic transmission line across Baranof Island to connect to Sitka's existing electric transmission system. Now therefore be it resolved by the Assembly of the City and Borough of Sitka that Sitka is committed to reducing its dependence on oil and developing its renewable energy resource; and Be it further resolved that the Administrator is authorized to apply to the Alaska Renewable Energy Fund for $2,000,000 to conduct the environmental, cultural, engineering and economic studies necessary to determine the feasibility of developing the hydroelectric potential of Takatz Lake. Resolution 2010-21 Page2 Passed and approved by the Assembly of the City and Borough of Sitka, Alaska on this 24th day ofAugust,20IA. ATTEST: Scott McAdams, Mayor Municipal Clerk 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) City & Borough of Sitka Type of Entity: Municipality Mailing Address 100 Lincoln Street, Sitka, Alaska 99835 Physical Address Same Telephone 907-747-1808 Fax 907-747-7403 Email jimdinley@cityofsitka.com 1.1 APPLICANT POINT OF CONTACT / GRANTS MANAGER Name Christopher Brewton Title Utility Director, Electric Department Mailing Address 105 Jarvis Street, Sitka, Alaska, 99835 Telephone 907-747-1870 Fax 907-747-3208 Email chrisb@cityofsitka.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 x 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) Takatz Lake Hydroelectric Feasibility Analysis 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. The project will be located approximately 20 airline miles east of the city of Sitka on the eastern shore of Baranof Island. Takatz Lake and the proposed powerhouse is located in: Sections 35 and 36 of Township 54S, Range 66E of the Copper River Meridian, and Sections 1,2,3,4,10 of Township 55S, Range 66E of the Copper River Meridian. See attached Figures (1) and (2) under Tab 11. Project will serve the City and Borough of Sitka and the Baranof Warm Springs community. The project will be capable of providing energy into other Southeast Alaska communities as the Southeast Regional Intertie is developed. 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 Design and Permitting x Feasibility Construction and Commissioning Conceptual Design 2.4 PROJECT DESCRIPTION Provide a brief one paragraph description of your proposed project. Development of hydroelectric power at Takatz Lake would include construction of a 200-foot high main concrete arch dam, a small 30-foot high secondary saddle dam, power intake, unlined tunnel, power penstock, power plant, tailrace, and transmission line segments including; underground, submarine, and overhead sections. The project would produce approximately 106,900 MWh per year via two (2) 13.8 MW turbine-generators. 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.) The project would increase Sitka’s current average hydroelectric capability from 124,500 MWh to 231,400 MWh and substantially reduce Sitka’s dependence on oil. The 106,900 MWh of average energy from Takatz Lake is equivalent to displacing approximately 8 million gallons of diesel generating plant fuel per year. Estimated costs for diesel fueled generation range from $0.20 to $0.33 per kWh for fuel costs from $3 to $5 per gallon, not including increased operations and maintenance costs. Projected cost of power from the Takatz project ranges from $0.14 to $0.19 per kWh depending on level of debt service required. 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 estimated funds needed are $3,000,000 through the resource assessment/feasibility analysis/ conceptual design phase. The final design and FERC licensing phase is expected to be in the order of $7,000,000. The cost of construction is estimated at $138,000,000 ($5,000 per kW) plus $78,000,000 for the transmission line across Baranof Island ($2 million per mile for 26 line-miles plus $10 million for a primitive equipment access road alongside the transmission line plus $16 million for the tunnel through the mountainous spine of Baranof Island). The total order of magnitude cost estimate for the Takatz Lake Hydroelectric Project and its associated transmission line is $226 million. The following funding has been provided for the project to date; FY2009 AEA Round 1 Grant $514,684 AEA Round 1 Supplemental Funding $637,450 CBS Takatz Lake Capital Project 90614 $186,000 FY2010 CBS Takatz Lake Capital Project 90614 $45,768 If the project proves feasible, then construction is anticipated to begin in the 2020 to 2022 time frame. The financing of the completed project has not been determined at this juncture but will likely be a mix of state/federal grant funding and municipal revenue bonds. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 5 of 18 7/21/2010 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. $ 2,000,000 2.7.2 Other Funds to be provided (Project match) $ 0 2.7.3 Total Grant Costs (sum of 2.7.1 and 2.7.2) $ 2,000,000 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) Grand total of $226,000,000 consisting of: $3,000,000 for the feasibility studies, $7,000,000 for the final design and FERC Licensing, plus $138,000,000 to construct the hydroelectric project, plus $78,000,000 to construct the transmission line to interconnect with the existing Sitka transmission system. 2.7.5 Estimated Direct Financial Benefit (Savings) $50+ million per year in avoided diesel generation: 106,900 MWh x $500/MWh 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.) $19+ million per year in avoided heating oil cost: 3.8 million gal of heating oil x $5 per gal 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. The Project Manager is the engineering and management staff of the City of Sitka’s Electric Department, led by Christopher Brewton, Utility Director and supported by a cadre of specialized consultants. Tab 9 contains a synopsis of the qualifications of the department staff. Tab 10 contains a listing of key consultants. This experienced engineering and management team operates and maintains two FERC licensed hydroelectric projects: Green Lake at 18 MW, Blue Lake at 8 MW. This team performed all the work necessary to obtain a new FERC license for the Blue Lake Hydroelectric Project. That thirty year FERC license was issued in March, 2008. Work is currently in progress by this team to amend the FERC license on the Blue Lake Hydroelectric Project to increase that project from 8 MW to 18 MW and increase its average energy generation capability by 35,000 MWh per year. 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.) 2011: Consult with Alaska DOT&PF on possible joint power/transportation project (transmission line with railway/highway across Baranof Island). Consult with state and federal resource agencies, develop study plans. Obtain the necessary permits to complete approved studies. Develop the preliminary engineering and environmental studies. Conduct geotechnical investigations. Begin preliminary design work. Obtain aerial photography and prepare project maps. Conduct public meetings per FERC ALP process. Conduct resource and economic studies. Prepare feasibility study and develop recommendations. 2012: Complete the preliminary engineering and environmental studies. Prepare preliminary cost estimates for primary and alternative designs. Complete market study & energy needs assessment. Decision point to proceed with final design, FERC licensing and financing to construct the project. Develop business and operations plan for utilization of resource. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 7 of 18 7/21/2010 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.) See Section 3.2 for general project plan and schedule. Attached FERC Scoping Document No. 2 under Tab 6 defines key tasks and schedules to prepare the Preliminary Draft Environmental Assessment (PDEA) for the project. Scoping Document No. 2 includes comments from public scoping meetings and stakeholders. These tasks will accomplish all milestones in the grant conditions. 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. This is a feasibility level project and does not anticipate construction or major equipment purchases. See 3.1 for project team and attached statement of qualifications. 3.5 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. The Authority will receive quarterly progress and financial reports which will include required semi-annual progress reports to FERC. A FERC approved communication protocol and the latest FERC report is attached under Tab 6. 3.6 Project Risk Discuss potential problems and how you would address them. The initial public scoping meetings for this project have been completed and initial response indicates the public concern with the project is the proposed transmission/transportation corridor(s). To date, there have been no negative comments or concerns expressed about the dam, powerhouse, and appurtenant facilities. Alternative transmission routes will be studied as part of the feasibility of the project and may mitigate these concerns. One other significant factor is the fact that utility construction & material technology have significantly improved since this project was initially conceived which may provide cost-effective solutions. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 8 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. Alternatives to developing Sitka’s hydroelectric resources include wind, ocean, and geothermal. Sitka is rated as a class 1 wind regime, very poor for wind power. Prior wind energy prospecting by Sealaska in 2002 thru 2005 at Yakutat and Hoonah found average wind speeds of 9 mph and 10% capacity factors which rendered wind uneconomic. If a wind resource exists in Sitka it would likely be offshore or atop the mountains near Sitka, but there is no access and the cost of construction per kilowatt of capacity would be higher than hydroelectric and the service life of a wind turbine is only twenty years compared to one hundred years for a hydroelectric turbine. The geothermal potential is unknown as no exploration for geothermal reservoirs has been conducted on Baranof Island. Ocean energy generation technology (wave, tidal etc.) is in its infancy and not yet commercially viable. The best alterative for Sitka’s long term power supply is its known and very reliable hydroelectric energy resources. This study project to determine the feasibility of the Takatz Lake Hydroelectric Project is the continuation of over one hundred years of hydroelectric power supply planning for Sitka dating back to early 1900’s. The more recent engineering investigations over the decades resulted in the construction of the Blue Lake Hydroelectric Project in 1960, followed by the construction of the Green Lake Hydroelectric Project in 1982, the addition of two small hydroelectric units at the existing Blue Lake hydroelectric project in 1992, and now the expansion of the existing Blue Lake Hydroelectric Project to its maximum capacity which is expected to be completed and in service no later than 2015. We believe we are now entering an era of increasingly scarce and increasingly expensive oil which will result in sustained growth in the demand for lower cost alternatives, such as hydroelectric energy. See the latest Sitka Load Forecast, under Tab 7 dated September 12, 2008 and the chart of Sitka’s energy requirements versus resources based on data from the load forecast. The forecasted demand for clean, renewable and relatively low cost hydroelectric energy to displace heating oil and gasoline could be as high as 223,979 MWh in 2029 (high forecast with electric cars, 171,419 MWh firm energy requirement plus 52,560 MWh interruptible energy sales) which would exceed the average hydroelectric generation capability of 159,000 MWh without Takatz Lake by 65,879 MWh. 65,879 MWh represents about a 60% utilization of the Lake Takatz Project’s average 106,900 MWh capability in 2029. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 9 of 18 7/21/2010 The most comprehensive work done on the Takatz Lake hydroelectric potential was by the Alaska Power Administration, U.S. Department of the Interior, in 1967. The plan of development dated January, 1968 is a result of a comprehensive investigation of Sitka area power alternatives by the USGS and APA over the period 1947 to 1967. The estimated 27.6 MW capacity and 106,900 MWh average generation capability of Takatz Lake is from a 1974 Power Supply Study prepared for Sitka by R.W. Beck and Associates, Consulting Engineers. That R.W. Beck study, prompted by the USA oil crisis of 1973, recommended that the Green Lake hydroelectric potential be developed and subsequently the Green Lake Hydroelectric Project was constructed by the City of Sitka, coming on line in 1982. Under the planned study project, this prior body of work on the Takatz Lake hydroelectric potential will be reviewed and brought current with an examination of today’s environmental, cultural, engineering and feasibility issues. The economic analysis will be developed in the feasibility study to be conducted as a primary product of this effort. 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. Sitka’s existing energy sources are: Blue Lake, hydro 8 MW 63,000 megawatt-hours - Constructed 1960 Green Lake, hydro 18 MW 61,000 megawatt-hours - Constructed 1982 Jarvis Street, diesel 12 MW Supplemental/Stand-by as required (3 ea) 1960 Vintage Units 6 MW Fairbanks-Morse (1 ea) 2000 Vintage Unit 6 MW Caterpillar ========== Total 38 megawatts 124,000 MWh hydroelectric - average water year, 90,000 MWh - low rainfall year 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. In fiscal year 2009, Sitka’s total gross generation was 119,689 MWh . The net energy delivered to the Power Transmission and Distribution System was 117,632 MWh . Consumers are reacting to volatile heating oil prices by shifting from oil to electric space heat. Sitka’s average hydroelectric generation capability is 124,000 MWh and will typically range from 90,000 MWh in a dry year to 134,000 MWh in a wet year. As a result, considering a low rainfall year capability of about 90,000 MWh , Sitka has now used up its firm hydroelectric energy supply and the growth in load will be increasingly met with supplemental diesel generation until additional hydroelectric capability can be brought on line. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 10 of 18 7/21/2010 4.2.3 Existing Energy Market Discuss existing energy use and its market. Discuss impacts your project may have on energy customers. A graph of Sitka’s power requirements versus resources, 1973 to 2030, is attached under Tab 8. There are three (3) graphs that represent various load growth scenarios. In all cases, inclusive of the Blue Lake Expansion Project, supplemental diesel generation will be required, without completion of the Takatz Lake project to meet forecasted load growth through 2022. 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 See attached application to FERC for a preliminary permit on Takatz Lake dated June, 2008 for project design details under Tab 6. 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 City & Borough of Sitka owns the shoreline lands around Takatz Lake and around Takatz Bay where the Takatz Lake Hydroelectric Project will be constructed; see Figure 3, Tab 11. Access to the site is by seaplane or by boat from Chatham Strait. The transmission line route is mostly on federal lands managed by the U.S. Forest Service. The City & Borough of Sitka owns the shoreline lands along the east side of Silver Bay where this project’s transmission line would interconnect with Sitka’s existing 69 kV transmission system. The transmission line corridor on federal lands will be under FERC jurisdiction and will require a special use permit by the U.S.D.A. Forest Service. Access to the transmission line for construction as well as maintenance will likely be over-land via a primitive equipment access road alongside the transmission line from the existing Sitka road system. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 11 of 18 7/21/2010 4.3.3 Permits Provide the following information as it may relate to permitting and how you intend to address outstanding permit issues. • List of applicable permits • Anticipated permitting timeline • Identify and discussion of potential barriers The primary authorization will be through a license issued by the Federal Energy Regulatory Commission (FERC), which will be lead agency for federally required environmental reporting and impact analysis under the National Environmental Policy Act (NEPA). The FERC license will contain Articles implementing terms and conditions from other resource agencies such as US Forest Service (USFS), US Fish and Wildlife Service (USFWS), Alaska Department of Fish and Game (ADF&G), Alaska Department of Natural Resources (ADNR), among others. Prior to construction, the City will require, among others, the following permits, certifications and authorizations: • Special Use Permit, USFS; • Coastal Zone Consistency Determination, ADNR; • Title 41 Fish Habitat Permit, ADF&G; • Clean Water Act Section 404 Dredge and Fill Permit, US Army Corps of Engineers (USACOE); • State Water Right for Diversion and Impoundment of Water, ADNR; • Biological Assessment or Evaluation, USFWS; • Various fuel and hazardous substance spill avoidance, containment and cleanup plans, US Environmental Protection Agency, USACOE, and Alaska Department of Environmental Conservation. Applications for these permits will occur at times specified by the respective agencies. USFS Special Use Permits may be necessary to conduct stream gaging, geotechnical, cultural resources and other surveys. Construction-related permits will be required before construction could commence. Licensing and permitting has been shown to be one of the most critical elements of hydro project development. The City team will work to address environmental conditions throughout the pre- construction period. This will involve negotiation of permit conditions well in advance of the construction start date to avoid adverse cost and schedule effects. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 12 of 18 7/21/2010 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 Under FERC licensing regulations, environmental issues must be identified and addressed in the framework of a list of Stakeholders including state and federal resource agencies, interest groups, the public and affected tribes and Native Corporations. Issue identification, impact analysis and mitigation planning represent significant components of a major project such as Takatz Lake. Through the FERC approved Alternative Licensing Process (ALP), see TAB 6, the City will address relevant issues in sufficient detail to prepare and submit a Preliminary Draft Environmental Assessment (PDEA) which includes, but not limited to, the following: Cumulative Effects Geologic & Soil Resources Water Quantity & Quality Aquatic Resources Terrestrial Resources Threatened & Endangered Species Recreation Resources & Land Use Aesthetic Resources Cultural Resources Socioeconomics Developmental Resources Among potential barriers in the environmental area are FERC regulations which afford significant authority by the US Forest Service to condition any eventual FERC license. The City will work closely throughout the development process with USFS to develop conditions acceptable to USFS, the City and FERC. Through the FERC order issuing the Preliminary Permit, see TAB 6, FERC issued notice that the U.S. Department of Agriculture and National Marine Fisheries Service had filed motions to intervene to be parties in the proceedings. Resource specific issues will be identified during required consultation, early in the development process. Early identification allows prioritization of those issues most likely to affect development schedule, cost and ultimate project feasibility. Detailed schedules for and descriptions of the steps of the environmental process are in the attached Scoping Document No. 2 under Tab 6. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 13 of 18 7/21/2010 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 Sitka is engaged in a long range strategy to decrease its dependence on oil by developing its renewable energy resources, particularly the known hydroelectric resources on Baranof Island. This project is the study and investigation phase of developing Sitka’s hydroelectric resources to determine the feasibility of developing the Takatz Lake Hydroelectric Project. The estimated cost of this phase of the study and investigation of the hydroelectric potential of Takatz Lake is $3,000,000. To date Sitka has received $1,152,134 in AEA funding and authorized $231,768 in Electric Department Capital Project funds for the Takatz Lake Project. The latest AEA Progress Report Form, Financial Statement, and Round I Grant Amendment 1 are attached under TAB 12. In addition Sitka has committed $4,764,937 of municipal funds in its FY2009 budget to developing its hydroelectric capacity at Blue Lake by expanding that existing hydroelectric project to its maximum capability. State funds of $20,500,000 have also been committed to the Blue Lake expansion project. The expansion of the existing Blue Lake Hydroelectric Project to its maximum capacity is estimated to cost $100,000,000 with a projected in service date no later than 2015. The total order of magnitude cost estimate for the Takatz Lake Hydroelectric Project is $226,000,000. The feasibility studies are estimated at $3,000,000. Final design and FERC licensing is estimated at $7,000,000. The cost of construction is estimated at $138,000,000 for the hydro project plus $78,000,000 for the associated transmission line across Baranof Island to interconnect with Sitka’s existing transmission system. Cost estimates for construction of the project were derived from previous Consultant estimates. Cost estimates for the feasibility studies are derived from Applicant’s Records and based on similar work with the Blue Lake License Application. Should the Alaska DOT&PF participate in the project for development of a transportation corridor to the east side of Baranof Island, the projected costs for the transmission portion of the project may significantly decrease! Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 14 of 18 7/21/2010 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.) This project is a feasibility study project and does not incur O&M costs. The requested grant funding is $2,000,000. The estimated O&M costs of the completed Takatz Lake Hydroelectric Project will be developed in the study as part of Milestone 7, Conceptual Design Analysis, and Milestone 8, Detailed economic and financial analysis. All of the costs to own operate and maintain the Takatz Lake Hydroelectric Project will be paid for by the sale of electric energy. 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 Sitka will be the owner and its residents the primary consumers, with surplus energy made available to other communities that may become electrically interconnected with Sitka. The principal market is the displacement of oil for Sitka’s heating and ground transportation needs. Today’s retail electric rates are approximately 40% lower than today’s heating oil prices. If that relationship is maintained into the future the output of the Takatz Lake Project is expected to be fully utilized by Sitka to displace oil for heating and ground transportation needs. The expected Takatz Lake Hydroelectric power purchase/sales price at full utilization will likely be in the range of 10 to 20 cents per kilowatt-hour, depending on the cost of capital (mix of grant and bond financing). That compares to the current diesel generation purchase/sales price range of 50 to 60 cents per kilowatt-hour. 4.4.4 Project Cost Worksheet Complete the cost worksheet form which provides summary information that will be considered in evaluating the project. Estimated costs are based on estimated fuel oil cost of $5.00 per gallon which is a reasonable estimate based on recent fuel oil costs experienced in Sitka. Cost analysis is based on full utilization of Takatz Lake at time of completion. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 15 of 18 7/21/2010 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 Sitka currently consumes about 6 million gallons of diesel fuel and 3 million gallons of gasoline per year, for a total of 9 million gallons for all purposes (power generation, heating, boats, and vehicles). Currently, the retail electric rates are about 40% lower than the equivalent heating oil cost for space heating. The retail electric rates are about 80% lower than the equivalent gasoline cost in a passenger car. If these cost relationships continue into the future, and viable electric cars become commercially available, the potential is to displace most land based diesel fuel and gasoline consumption for heating and ground transportation in Sitka over the next twenty years. If half of today’s diesel and gasoline consumption in Sitka were displaced by hydroelectric energy the potential fuel displacement would be about 4.5 million gallons per year. Displacing 4.5 million gallons of fuel per year represents an avoided fuel cost of about $22 million per year ($5 per gallon). The benefit to the environment of displacing 4.5 million gallons of fuel with clean, renewable hydroelectric energy would be a reduction in green house gas emissions of about 50,364 tons of carbon dioxide per year. A project design life of 30 years equates to 135 million gallons of fuel oil displaced by zero-emission hydro and elimination of over 1,510,920 tons of carbon dioxide. Assuming the fuel is burned at an average efficiency of 50%, the equivalent hydroelectric energy required to displace 4.5 million gallons of fuel would be about 81,000 MWh , which is 75% of the 106,900 MWh average capability of the Takatz Lake Hydroelectric Project. Based on the historical average load growth of 3.8% approximately 35% of the project would be utilized the year of commissioning, assuming it is constructed by 2020, with remaining plant capacity fully utilized within 8 years of commissioning. In addition to the economic benefits, the City & Borough of Sitka fully supports the reduction of greenhouse gases, mitigating climate change, and reduction of hydrocarbons consumed. See attached Assembly Resolutions under Tab 12. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 16 of 18 7/21/2010 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 The Takatz Lake Hydroelectric Project will be integrated into the existing electric utility system owned and operated by the City & Borough of Sitka. The plant would be remotely operated via Blue Lake Powerhouse SCADA system and would require regular maintenance & operations inspections on a frequency to be determined based on final plant engineering design. Operations and maintenance costs would be included in a cost-based rate designed to encourage maximum utilization of the facility while maintaining reasonable energy costs. The relative remoteness and harsh winter weather may lead to the decision to operate the plant as a manned facility, similar to the method utilized by KPU for their remote Swan Lake facility. Should that occur, 2 to 3 FTE employees and associated costs would be added to the existing 25 member Electric Department staffing levels. Completion of this project will not result in reduction or elimination of any existing resources. Stand-by diesel will be maintained at existing levels, however supplemental diesel generation will be required should load growth continue at expected rates. The City & Borough of Sitka is fully committed to a reduction in hydrocarbon usage and full utilization of all economically viable hydroelectric projects and will report necessary reporting to meet all regulatory and financial requirements. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 17 of 18 7/21/2010 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. The City & Borough of Sitka requested $2,000,000 and was awarded $514, 684 in AEA Round 1 Renewable Energy Grant awards. Subsequently additional grant funding in the amount of $637,450 was provided. Significant accomplishments to date include: • Submission of FERC Preliminary Application Document (TAB 6) • FERC Order issuing Preliminary Permit (TAB 6) • Approval of Alternative Licensing Process (ALP) & Communication Protocol (TAB 6) • Completion of initial LiDAR survey of project site • Completion of Scoping Meeting #1 in Juneau and Sitka • Completion of Scoping Document #2 • Contracts have been awarded for the following work: o FERC Licensing Consultant o Fisheries Field Studies o Cultural Field Studies o Wildlife Field Studies o Engineering Support & Transmission Line Design 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. Based on the comments received during the two public scoping meeting held on October 7, 2009 in Juneau, Alaska and October 8, 2009 in Sitka, Alaska there appears to be favorable support and understanding of the need for the project. However, a spokesman for the Baranof Property Owners Association voiced concern over the transmission corridors, specifically as it relates to passing through the Warm Springs Bay and Baranof Lake areas. Consequently, an alternative transmission route that bypasses the Warm Springs community will be evaluated; see Figure 4 under Tab 11. Verbatim transcripts of both meetings are available the FERC website, www.ferc.gov under project number 13234-001. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 18 of 18 7/21/2010 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 This study project to determine the feasibility of the Takatz Lake Hydroelectric Project is the continuation of several decades of power supply planning for Sitka dating back to 1924. The various engineering investigations over the decades resulted in the construction of the Blue Lake Hydroelectric Project in 1960, followed by the construction of the Green Lake Hydroelectric Project in 1982, the addition of two small hydroelectric units at the existing Blue Lake hydroelectric project in 1992, and now the expansion of the existing Blue Lake Hydroelectric Project to its maximum capacity is expected to be completed and in service by 2015. The next project identified for development is the 27.6 MW Takatz Lake Hydroelectric Project. The most comprehensive work done on the Takatz Lake potential was by the Alaska Power Administration, U.S. Department of the Interior, in 1967. The plan of development dated January, 1968 is a result of a comprehensive investigation of Sitka area power alternatives by the USGS and APA over the period 1947 to 1967. This prior body of work will be reviewed and brought current with an examination of today’s environmental, cultural, engineering and feasibility issues. The analysis work required under the FERC preliminary permit is expected to cost approximately $3,000,000 over the three year term of the FERC permit. Attached is an estimate of budget costs by milestones using the form – GrantBudget4.xls, found under Tab 5. In addition to this form under Tab 5, a second budget sheet is provided which includes all required milestones subdivided into sub-tasks and all funding sources from CBS funds, AEA Round I grant award, subsequent Amendment 1 grant award, and projected budget for the requested $2,000,000 AEA Round IV grant request. Grant Documents Authorized Signers Please clearly print or type all sections of this form. Comm u nity/Grantee Name: & Borouqh of Sitka Date: First Tuesdav in October 10.2010 Authorized Grant S s Printed Name Title Term Srgrytu;e Dave Wolff Finance Director lndefinite %// Jim Dinley Municipal Administrator Indefinite -\i $%q I authorize the above person(s) to sign Grant Documents: (H ig hest ra nki ng organ ization/comm u n ity/m u n icipa I officia l) ftuy Grantee Contact I nformation : Please submit an updated form whenever there is a change to the above information. t'"xi:,l"jgJir"riflil3l,fii'o'etedformto: ,@ n I Acv A 813w Norrhern Lights Brvd I f Al-,FuI\F\ Anchorage, AK 99503 J @ ENERCY AUTHORIW Attn. Butch White. Grants Administrator Printed Name Title Term Signature Scott McAdams Jaof OAne* Mayor De-pu-,fu ltttrnr October 2010 At / d, --,-^'/ Mailing Address: 100 Lincoln Street. Sitka AK 99835 Phone Number: 907-747-1808 Fax Number: 907-747-7403 E-mailAddress: i imd in lev@citvofsitka. com Federal Tax lD #: 92-0041163 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. 100% (hydroelectric, reservoir) 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 i. Number of generators/boilers/other grid, leave this section blank) Six hydroelectric units, four diesel units. ii. Rated capacity of generators/boilers/other 26 MW hydro + 12 MW diesel = 38 MW total iii. Generator/boilers/other type None iv. Age of generators/boilers/other Hydro 1960-1982 vintage, diesel 1968-2000 vintage v. Efficiency of generators/boilers/other b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank) i. Annual O&M cost for labor $3.67M – total utility labor costs in FY2009 ii. Annual O&M cost for non-labor $7.87M – total utility non-labor costs in FY2009 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] 119,689,604 kWh gross generation in FY2009 ii. Fuel usage Diesel [gal] 46,000 gallons in FY2009 for supplemental/stand-by diesel generation Other iii. Peak Load 22.3 MW in December 2007 iv. Average Load 13.8 MW v. Minimum Load 10.5 MW vi. Efficiency Hydro 85 to 90%, 1968 vintage diesel 13.2 kWh/gal vii. Future trends Hydro 85 to 90%, 2000 vintage diesel 15.0 kWh/gal d) Annual heating fuel usage (fill in as applicable) i. Diesel [gal or MMBtu] 3.9 million gallons – space heating ii. Electricity [kWh] 114,866,192 kWh sold in FY2009 iii. Propane [gal or MMBtu] iv. Coal [tons or MMBtu] v. Wood [cords, green tons, dry tons] 800 cords – space heating vi. Other 2.3 million gallons – distillate fuel for road/boat usage 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] 63.6 MW hydro with Blue Lake Expansion & Takatz Lake b) Proposed annual electricity or heat production (fill in as applicable) i. Electricity [kWh] 265,000 MWh hydro with Blue Lake Expansion & Takatz 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 $138 million hydro + $78 million trans = $216 million b) Development cost $10 million for Engineering and FERC licensing c) Annual O&M cost of new system $19 million/yr total cost of ownership (debt financed) d) Annual fuel cost N/A 5. Project Benefits a) Amount of fuel displaced for i. Electricity Potential of 8 million gallons diesel fuel per year, displaced diesel generation ii. Heat Potential of 3.9 million gallons, displaced heating oil per year iii. Transportation Potential of 2.3 million gallons, displaced on road gas/diesel fuel per year b) Current price of displaced fuel Assume $5 per gallon c) Other economic benefits Electricity to Baranof Warm Springs community d) Alaska public benefits Potential of $71 million/yr – 14.2 million gal fuel displaced 6. Power Purchase/Sales Price a) Price for power purchase/sale Takatz Lake 14 to 20 cents per kWh depending on projects utilization and capital cost 7. Project Analysis a) Basic Economic Analysis Project benefit/cost ratio 1.97+; i.e.: $40 million annual avoided diesel gen / $20.34 million annual Takatz cost Payback (years) 11.11 years; i.e.: $20.34 million/yr net savings X 11.11 yrs = $226 M Renewable Energy Fund Round 4 Project Cost/Benefit Worksheet RFA AEA11-005 Application Cost Worksheet Page 3 7-21-10 Notes: 1. Cost to develop Takatz Lake Hydroelectric Project – Order of magnitude estimate Resource assessment/feasibility/conceptual-preliminary design $ 3,000,000 Final design and FERC licensing $ 7,000,000 Construction Hydro 27,700 kW X $5,000/kW = $138,000,000 Transmission Line 26 miles X $2 million/mile = $ 52,000,000 1.9 mile Tunnel = $ 16,000,000 Equipment access road 20 miles $0.5 million/mile = $ 10,000,000 Transmission $ 78,000,000 Total $216,000,000 ========== Grand Total $226,000,000 2. Annual Takatz Lake Hydro Project costs of ownership – Order of magnitude estimate Interest 5.0% (100% debt) 2.5% (50% debt - 50% grant) Depreciation 2.0% 2.0% O&M 1.0% 1.0% Insurance 1.0% 1.0% === === Fixed charge rate 9.0% 6.5% Annual costs = $226 million X 9% = $20.34 million per year (100% debt financed) $20.34 million / 106,900 MWh = 19.02 cents per kWh at full utilization If 50% grant funded, then: Annual costs = $226 million X 6.5% = $14.69 million per year (50% grant financed) $14.69 million / 106,900 MWh = 13.74 cents per kWh at full utilization Renewable Energy Fund Grant Round IV Grant Budget Form 7-21-10 Milestone or Task Anticipated Completion Date RE- Fund Grant Funds Grantee Matching Funds Source of Matching Funds: Cash/In-kind/Federal Grants/Other State Grants/Other TOTALS (List milestones based on phase and type of project. See Attached Milestone list. ) Project scoping and contractor solicitation. 2011 $50,000 $0 $50,000 Detailed energy resource analysis 2011 $300,000 $0 $300,000 Identification of land and regulatory issues 2011 $100,000 $0 $100,000 Permitting and environmental analysis 2012 $1,000,000 $0 $1,000,000 Detailed analysis of existing and future energy costs and markets 2012 $100,000 $0 $100,000 Assessment of alternatives 2011 $100,000 $0 $100,000 Conceptual design analysis and cost estimate 2012 $150,000 $0 $150,000 Detailed economic and financial analysis 2012 $100,000 $0 $100,000 Conceptual business and operations plans 2012 $50,000 $0 $50,000 Final report and recommendations 2012 $50,000 $0 $50,000 TOTALS $2,000,000 $0 $2,000,000 Budget Categories: Direct Labor & Benefits $50,000 $ $50,000 Travel & Per Diem $50,000 $ $50,000 Equipment $100,000 $ $100,000 Materials & Supplies $50,000 $ $50,000 Contractual Services $1,750,000 $ $1,750,000 Construction Services $ $ $ Other $ $ $ TOTALS $2,000,000 $ $2,000,000 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 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 FERC SCOPING DOCUMENT No. 2 TAKATZ LAKE HYDROELECTRIC PROJECT PROJECT No. 13234-001 Reference Document: Grant Application, Tab 3: page 7 of 19, page 12 of 19 SCOPING DOCUMENT 2 TAKATZ LAKE HYDROELECTRIC PROJECT ALASKA PROJECT NO. 13234-001 Prepared for the Federal Energy Regulatory Commission Office of Energy Projects Division of Hydropower Licensing Washington, D.C. June 2010 2 TABLE OF CONTENTS 1.0 INTRODUCTION .........................................................................................................5 2.0 SCOPING .....................................................................................................................8 2.1 PURPOSES OF SCOPING ..............................................................................................8 2.2 COMMENTS AND SCOPING MEETINGS .........................................................................9 2.3 SCOPING COMMENTS ...........................................................................................10 3.0 PROPOSED ACTION AND ALTERNATIVES ........................................................11 3.1 THE CITY’S PROPOSED ACTION ................................................................................11 3.1.1 Proposed Project Facilities ..............................................................................11 3.1.2 Proposed Project Access ..................................................................................15 3.1.3 Proposed Project Operations ...........................................................................16 3.1.4 Proposed Environmental Measures .................................................................16 3.2 ALTERNATIVES TO THE PROPOSED ACTION................................................................16 3.3 NO ACTION ...............................................................................................................17 4.0 SCOPE OF CUMULATIVE EFFECTS AND RESOURCE ISSUES ........................17 4.1 CUMULATIVE EFFECTS .............................................................................................17 4.1.1 Past, Present and Reasonably Foreseeable Actions ..........................................17 4.1.2 Cumulatively Affected Resources .......................................................................18 4.1.3 Geographic Scope ............................................................................................19 4.1.4 Temporal Scope ..................................................................................................19 4.2 RESOURCE ISSUES.....................................................................................................19 4.2.1 Geologic and Soils Resources ..........................................................................20 4.2.2 Water Quantity and Quality .............................................................................20 4.2.3 Aquatic Resources ............................................................................................20 4.2.4 Terrestrial Resources .......................................................................................21 4.2.5 Threatened and Endangered Species ...............................................................22 4.2.6 ...........................................................22 Recreation Resources and Land Use 4.2.7 ......................................................................................22 Aesthetic Resources 4.2.8 Cultural Resources ...........................................................................................23 4.2.9 Socioeconomics ................................................................................................23 4.2.10 ................................................................................................24 Public Safety 4.2.11 Developmental Resources ..............................................................................24 5.0 POTENTIAL STUDIES ..............................................................................................24 6.0 INFORMATION REQUESTED .................................................................................28 7.0 EA PREPARATION SCHEDULE.............................................................................29 3 8.0 PROPOSED EA OUTLINE .......................................................................................30 9.0 COMPREHENSIVE PLANS ......................................................................................32 10.0 FERC OFFICIAL MAILING LIST...........................................................................33 APPENDIX I ....................................................................................................................33 AGENCY/PARTY COMMENTS RESPONSE TABLE ...............................................33 LIST OF FIGURES FIGURE 1. LOCATION OF THE TAKATZ LAKE PROJECT (SOURCE: CITY AND BOROUGH OF SITKA, ELECTRIC DEPARTMENT, PAD, 2009)...............................................................8 FIGURE 2. PROJECT FACILITIES FOR THE TAKATZ LAKE PROJECT (SOURCE: CITY AND BOROUGH OF SITKA, ELECTRIC DEPARTMENT, PAD, 2009).......................................12 LIST OF TABLES TABLE 1. PROCESS PLAN AND SCHEDULE ...........................................................................7 TABLE 2. THE CITY’S POTENTIAL STUDIES. (SOURCE: CITY AND BOROUGH OF SITKA ELECTRIC DEPARTMENT, PAD, 2009).........................................................................24 4 ACRONYMS AND ABBREVIATIONS ac-ft acre-feet ALP Alternative Licensing Process ADEC Alaska Department of Environmental Conservation ADF&G Alaska Department of Fish and Game ADOT&PF Alaska Department of Transportation & Public Facilities ADNR Alaska Department of Natural Resources APA Alaska Power Administration APE Area of Potential Effect City City and Borough of Sitka cfs cubic feet per second Commission or FERC Federal Energy Regulatory Commission DO Dissolved oxygen EA environmental assessment EIS environmental impact statement Forest Service U.S. Forest Service FPA Federal Power Act FWS U.S. Fish and Wildlife Service hp horsepower kV kilovolt LUD Land use designation MW megawatt MWh megawatt-hours mgd million gallons per day msl mean sea level NEPA National Environmental Policy Act NGO non-governmental organizations NMFS National Marine Fisheries Service NSRAA Northern Southeast Regional Aquaculture Association PAD Pre-Application Document PDEA preliminary draft environmental assessment SD1 Scoping Document 1 SD2 Scoping Document 2 SHPO State Historic Preservation Office Takatz Lake Project or project Takatz Lake Hydroelectric Project 5 SCOPING DOCUMENT 2 Takatz Lake Hydroelectric Project, No. 13234-001 1.0 INTRODUCTION The Federal Energy Regulatory Commission (Commission or FERC), under the authority of the Federal Power Act (FPA),1 may issue licenses for terms ranging from 30 to 50 years for the construction, operation, and maintenance of non-federal hydroelectric projects. On March 20, 2009, the City and Borough of Sitka (City) filed a Pre- Application Document (PAD) and Notice of Intent to seek an original license for the 27.6-megawatt (MW) Takatz Lake Hydroelectric Project (Takatz Lake Project or project).2 The Takatz Lake Project would be located on Takatz Lake approximately 20 miles east of the City of Sitka, Alaska, on the east side of Baranof Island (figure 1). The project would occupy federal lands within the Tongass National Forest, administered by the U.S. Forest Service (Forest Service). A new concrete dam and secondary saddle dam would raise the elevation of Takatz Lake 200 feet, providing a total storage capacity of 124,000 acre-feet (ac-ft), of which 82,000 ac-ft would be active storage. An approximately 2,800- foot-long tunnel and a 1,000-foot-long penstock would discharge the lake flows into a 4,000-square-foot powerhouse, with two 18,600 horsepower (hp) Francis turbines on the shore of Takatz Bay that would provide an estimated 97,100 megawatt-hours (MWh) of firm energy each year. A more detailed description of the key project facilities is provided in section 3.0. The National Environmental Policy Act (NEPA) of 1969,3 the Commission’s regulations, and other applicable laws require the Commission to independently evaluate the environmental effects of issuing an original license for the Takatz Lake Project as proposed, and to consider reasonable alternatives to the City’s proposal. Although 116 U.S.C. § 791(a)-825(r). 2On September 19, 2008, the Commission issued a Preliminary Permit (permit) to the City to study the feasibility of developing a hydroelectric project on the Takatz Lake. The preliminary permit provides the City protection under the FPA from competitive applications while conducting the studies and processes necessary to complete an application for license. In its Notice of Intent, the City expects to file the license application with the Commission by August 31, 2011. 3 National Environmental Policy Act of 1969, as amended (Pub. L. 91-190. 42 U.S.C. 4321-4347, January 1, 1970, as amended by Pub. L. 94-52, July 3, 1975, Pub. L. 94-83, August 9, 1975, and Pub. L. 97-258, §4(b), September 13, 1982). 6 Commission staff intends to prepare a draft and final environmental assessment (EA), there is a possibility that an Environmental Impact Statement (EIS) will be required. The EA will describe and evaluate the probable effects, including any site-specific and cumulative effects, of the proposed action and alternatives. Takatz Lake Project Background & Licensing Process to Date Since the preliminary permit was issued on September 19, 2008, the licensing process for the Takatz Lake Project includes the following activities:  Distribution of a PAD describing the project, the licensing process, and preliminary environmental information on March 20, 2009. The PAD contains descriptions of existing resources, expected impacts and possible environmental studies, as known at the time of writing, and is a source of background information.  Submission to the Commission and consulting agencies of a request to utilize the Alternative Licensing Process (ALP). The ALP is a process for licensing which allows the applicant to prepare a preliminary draft environmental assessment (PDEA), in lieu of an Exhibit E, as part of the license application. Subsequently, the use of the ALP was approved by the Commission on April 28, 2009. All documents, meeting minutes, and submissions from these early licensing activities are available from the City. The exact name, business address, and phone number of each person authorized to act as agents for the applicant are: James E. Dinley, Municipal Administrator City and Borough of Sitka 100 Lincoln Street Sitka, AK 99835 Phone: 907-747-1808 E-mail: jimdinley@cityofsitka.com Christopher Brewton, Utility Director City and Borough of Sitka, Electric Department 105 Jarvis Street Sitka, AK 99835 Phone: 907-747-1870 E-mail: chrisb@cityofsitka.com All questions, comments, or correspondence related to the licensing for the project should be directed to Christopher Brewton. 7 The schedule shown in table 1 demonstrates the City’s completed and prospective actions leading to filing a final license application and PDEA with the Commission for a license to construct, operate, and maintain the Takatz Lake Project. Table 1. Process Plan and Schedule Activity Schedule PAD/NOI/ALP Request March 20, 2009 FERC approves use of ALP April 28, 2009 Scoping Document 1 issued September 4, 2009 Scoping October 7 & 8, 2009 Scoping Document 2 issued June 2010 Study Planning meetings Fall 2009, Spring 2010 Study Execution 2009-2011 Engineering Studies 2009-2011 Draft License Application to Stakeholders and federally recognized tribes and native corporations Spring 2011 Stakeholders and federally recognized tribes and native corporations comment on Draft License Application Spring-Summer 2011 Final License Application filed with FERC August 31, 2011 Figure 1. Location of the Takatz Lake Project (Source: City and Borough of Sitka Electric Department, PAD, 2009) 2.0 SCOPING This Scoping Document 2 (SD2) is intended to advise all participants as to the proposed scope of the EA and to seek additional information pertinent to this analysis. This document contains: (1) a description of the scoping process; (2) a description of the proposed action and alternatives; (3) a preliminary identification of environmental issues and proposed studies; (4) a request for comments and information; (5) a proposed EA outline; and (6) a preliminary list of comprehensive plans which would be applicable to the project. 2.1 Purposes of Scoping Scoping is the process used to identify issues, concerns, and opportunities for enhancement or mitigation associated with a proposed action. According to NEPA, the process should be conducted early in the planning stage of the project. Under the ALP, the applicant conducts scoping in collaboration with Commission staff to fulfill the FERC’s NEPA responsibilities. The purposes of the scoping process are as follows: 8 9  invite participation of federal, state and local resource agencies, federally recognized tribes and native corporations, non-governmental organizations (NGOs), and the public to identify significant environmental and socioeconomic issues related to the proposed project;  determine the resource issues, depth of analysis, and significance of issues to be addressed in the EA;  identify how the project would or would not contribute to cumulative effects in the project area;  identify reasonable alternatives to the proposed action that should be evaluated in the EA;  solicit, from participants, available information on the resources at issue, including existing information and study needs; and  determine the resource areas and potential issues that do not require detailed analysis during review of the project. We issued SD1 on September 4, 2009, to enable appropriate resource agencies, federally recognized tribes and native corporations, and other interested parties to more effectively participate in and contribute to the scoping process. In SD1, we requested clarification of preliminary issues concerning the Takatz Lake Project and identification of any new issues that need to be addressed in the EA. We revised SD1 following the scoping meetings and after reviewing comments filed during the scoping comment period. SD2 presents our current view of issues and alternatives to be considered in the EA. Additions to SD1 are shown in bold and italic type in this SD2. 2.2 Comments and Scoping Meetings In addition to written comments solicited by SD1, we held two scoping meetings to identify potential issues associated with the project. The notice of the scoping meetings was published in local newspapers and in the Federal Register. An evening scoping meeting was held on October 8, 2009, in Sitka and a morning scoping meeting was held on October 7, 2009, in Juneau. A court reporter recorded comments made during the scoping meetings. In addition to the comments received at the scoping meetings, the following entities filed written comments on the SD1: 10 Entity Date Filed James Brennan November 18, 2009 Sitka Conservation Society November 24, 2009 Northern Southeast Regional Aquaculture Association December 7, 2009 Forest Service December 7, 2009 Baranof Property Owners Association December 8, 2009 Alaska Department of Fish and Game December 8, 2009 All comments received are part of the Commission’s official record for the project. Information in the official file is available for inspection and reproduction at the Commission's Public Reference Room, located at 888 First Street, N.E., Room 2A, Washington, DC 20426, or by calling (202) 502-8371. Information also may be accessed through the Commission’s eLibrary using the “Documents & Filings” link on the Commission’s web page at http://www.ferc.gov. Call (202) 502-6652 for assistance. 2.3 Scoping Comments The primary purpose of the scoping document is to identify issues pertaining to the effects of the proposed project on environmental resources so that we can be sure to include an analysis of all potential effects in the Environmental Assessment (EA). It is not the purpose of the scoping document to identify all of the recommended protection, mitigation, and enhancement measures, or license conditions. The scoping document summarizes the applicant’s proposed environmental measures because they are part of the proposed action that is the subject of the environmental analysis. The general concerns raised by participants in the scoping process are summarized in Appendix I. The summary does not include every oral and written comment made during the scoping process, but rather, addresses the general comments or concerns that call for a response. We also summarize and respond to any issues that were recommended to be incorporated into the scoping process but were not adopted in the scoping document. Multiple entities commented with requests for studies to explore data gaps related to the issues identified in SD1 and this SD2. Additionally, some of the commenting entities requested edits to SD1 that are actually requests for the City to conduct additional studies or expand upon existing proposed studies. The additional study requests are not evaluated in this SD2. The City is reviewing all study request comments and will be working together with stakeholders to address study needs throughout the ALP pre-filing process. 11 3.0 PROPOSED ACTION AND ALTERNATIVES In accordance with NEPA, Commission staff’s environmental analysis will consider the following alternatives, at a minimum: (1) the no-action alternative; (2) the applicant's proposed action; and (3) alternatives to the proposed action. 3.1 The City’s Proposed Action The City is seeking an original license to construct, operate, and maintain the Takatz Lake Project. The Commission will consider whether, and under what conditions, to issue an original license for the project. 3.1.1 Proposed Project Facilities In its PAD, the City cites the proposed project design for the Takatz Lake Project and other supporting data from a report by the U.S. Department of the Interior and Alaska Power Administration (APA), entitled Plan for Development for Takatz Creek Project, Alaska dated January, 1968. The City’s current design is the same as what is proposed by the APA. Because exact locations of project features, particularly transmission facilities, are speculative at this time, no project boundary is shown. The project boundary will be initially proposed to extend about 100 feet from both the proposed reservoir shoreline and from all proposed project facilities. Reservoir Takatz Lake is located approximately 4,000 feet upstream of the mouth of Takatz Creek (figure 2), which flows into Chatham Strait by way of Takatz Bay on the eastern shore of Baranof Island. The natural existing water surface of Takatz Lake is at approximately 905 feet mean sea level (msl) and the current lake volume is estimated to be about 62,000 ac-ft. The proposed dam would increase the reservoir volume to approximately 124,000 ac-ft, or an increase in utilized reservoir capacity of approximately 82,000 ac-ft. The surface area of Takatz Lake would increase approximately 362 acres from 378 acres to 740 acres as a result of the proposed project impoundment. Figure 2. Project facilities for the Takatz Lake Project (Source: City and Borough of Sitka Electric Department, PAD, 2009). Dams The Takatz Creek primary dam would be located on Takatz Creek just downstream of the existing outlet of Takatz Lake. The Takatz Creek primary dam would be 200-foot-high primary concrete arch dam with spillway at elevation 1,040 msl and dam crest at elevation 1,052 msl. A secondary dam, the “Saddle Dam,” would be approximately 30 feet high and would be located south and east of the primary dam. Intake/Power Tunnel/Penstock Water would be withdrawn through a gate structure intake into an approximately 2,800-foot-long, 6.5-foot-wide by 7-foot-high modified horseshoe tunnel. The tunnel’s downstream portal would connect to a 72-inch-diameter, 1,000-foot-long steel penstock leading to the powerhouse. The net operating head of the project would be about 1,000 feet. 12 13 Powerhouse, Switchyard, and Tailrace A surface powerhouse approximately 4,000 square feet in area would be constructed at sea level near Takatz Bay. The powerhouse would house two 18,600-hp Francis turbines, driving two 13.8-MW generators. A switchyard would be located near the powerhouse. The powerhouse tailrace would provide an average discharge of about 166 cubic feet per second (cfs) into the tidewater of Takatz Bay. The total installed capacity of the project would be 27.6 MW, depending on final design. The APA study indicated that two impulse-type turbine generators of approximately equal capacity would be installed. The high operating head suggests such generators, but exact turbine type will be determined during further feasibility studies. The Takatz Lake project configuration is expected to produce 97,100 MWh of firm annual energy and 9,800 MWh of non-firm energy for a total average capability of 106,900 MWh of generation each year. Transmission Facilities Power generated by the project would be transmitted by a new 21-mile-long, 115 kilovolt (kV) transmission line (or whatever regional transmission voltage is established), but energized initially at 69 kV. The transmission line would consist of a combination of overhead, underground, and submarine segments. Exact transmission type and routing will be determined based on further field investigations and feasibility studies due to the high avalanche hazards along the route. The proposed transmission line, Marine Alternative Segment, would be of submarine construction from Takatz Bay, into Chatham Straight and then Warm Springs Bay. A substation would be constructed at Baranof Warm Springs to supply power to the community. From Baranof Warm Springs, the transmission line would follow either a combined overhead and underground route around Baranof Lake or an underwater route on the lake bottom, depending on avalanche hazards and road construction. Once beyond Baranof Lake, the transmission line would continue up the Upper Baranof River valley, overhead, to an undetermined point at which it would follow a 2-mile-long tunnel passing north of Indigo Lake and south of Mount Bassie. The tunnel would daylight in the Medvejie Valley and would continue either buried or overhead down the Medvejie Lake valley to interconnect with the existing 69-kV transmission system connecting the Blue Lake and Green Lake Projects to the City of Sitka Electric Department service area (Figure 1). Based on comments received from the scoping meetings and the SD1, the City has developed another alternative (Overland Segment) for the transmission line route. This Overland Segment Alterative would follow the route of the Marine Segment Alternative transmission line to a point approximately 1.5 miles from the proposed powerhouse location. At that point, the route would proceed overland 3 miles south and west to the north shore of Baranof Lake. At Baranof Lake, the transmission line would follow either a combined overhead and underground route around Sadie Lake or an underwater route on the lake bottom, depending on avalanche hazards and road construction. From Baranof Lake, the transmission line would be above ground through the Upper Baranof River Valley to a 2-mile-long tunnel passing north of Indigo Lake and south of Mount Bassie. Beyond the tunnel, the transmission line would continue either buried or above ground through the Medvejie Valley to the interconnection with the existing 69-kV Green Lake Project transmission line (Figures 3 and 4). The Overland Segment responds to concerns for impacts on both the community of Baranof Warm Springs and those on marine resources in Chatham Straight and Baranof Bay. However, both transmission line alternatives will be evaluated as part of the development of final license application.4 Figure 3. Detail of Transmission Line – Marine Segment (Source: City and Borough of Sitka, Electric Department). 14 4 The Overland Segment is the City’s preferred alternative and will be evaluated as quickly as possible to eliminate the potential study costs and environmental impacts of the Marine Segment. Figure 4. Detail of Transmission Line- Overland Segment (Source: City and Borough of Sitka, Electric Department). 3.1.2 Proposed Project Access Generating Facilities Access for construction and long-term operation and maintenance of the project generating facilities would be via floatplane, helicopter, and boat. A gravel-surfaced access and maintenance road would lead from a dock to be constructed on Takatz Bay to Takatz Lake and the project features. Access to the construction sites for transmission facilities near Baranof Lake would also be via floatplane or boat, and staging would be provided by a dock in Warm Springs Bay, Alaska. 15 16 Transmission Line Access Road The transmission line construction for Transmission Alternatives, Marine Segment and Overland Segment that would occur west of Baranof Warm Springs may be accessed by a road which would connect Baranof Warm Springs with the Green Lake road at the Northern Southeast Regional Aquaculture Association (NSRAA) Medvejie hatchery. The road would facilitate construction of the transmission facilities. The approximately 2-mile-long tunnel would also house the transmission line in the road right-of-way. 3.1.3 Proposed Project Operations The project would supplement energy generated by the City’s two primary hydroelectric projects, the Blue Lake Project (FERC No. 2230) and Green Lake Project (FERC No. 2818). The City operates these projects to meet base and peaking load requirements within the City’s Service area. Currently, the Blue Lake Project generates base-load energy and the Green Lake Project provides peaking capacity. The Takatz Lake Project would be used to meet base load or peaking load depending on reservoir management and frequency control. In any case, generation would be optimized by following a rule curve reflecting seasonal inflow, spill capacity, and drawdown limitations. Final project and system load configuration will be determined in further feasibility studies. The project would be an unmanned facility. Operation would be monitored and controlled from the existing Blue Lake Control Center via a SCADA system. Maintenance personnel would visit the plant approximately monthly, providing routine equipment maintenance. 3.1.4 Proposed Environmental Measures The City has not identified specific measures to protect and mitigate environmental resources of the project area at this time. However, the City proposes to conduct several studies that will analyze the project’s impact on various resources. See Section 5.0 of this document for a description of the proposed studies. 3.2 Alternatives to the Proposed Action The EA will consider and analyze all recommendations for operation or facility modifications, as well as for protection, mitigation, and enhancement measures identified by Commission staff, resource agencies, federally recognized tribes and native corporations, NGOs, and the public. 17 3.3 No Action Under the no-action alternative, the Commission would deny a license for the proposed Takatz Lake Project. The project would not be built and there would be no change to the existing environment. We use this alternative to establish baseline environmental conditions for comparison with other alternatives. 4.0 SCOPE OF CUMULATIVE EFFECTS AND RESOURCE ISSUES 4.1 Cumulative Effects According to the Council on Environmental Quality's regulations for implementing NEPA (50 C.F.R. 1508.7), a cumulative effect is the effect on the environment that results from the incremental effect of the action when added to other past, present and reasonably foreseeable future actions, regardless of what agency (Federal or non-Federal) or person undertakes such other actions. Cumulative effects can result from individually minor but collectively significant actions taking place over a period of time, including hydropower and other land and water development activities. Based on information from the PAD, comments from scoping and preliminary staff analysis, we have identified geothermal, water quality, aquatic, terrestrial, and recreation resources as resources that may be cumulatively affected by the proposed project. 4.1.1 Past, Present and Reasonably Foreseeable Actions The primary actions which might cumulatively affect resources would be 1) The Blue Lake hydro power project (FERC No. 2230) and the Blue Lake Expansion Project, currently in the amendment application phase. This hydro project and its expansion lies in a basin whose headwaters are adjacent to the Takatz Lake basin headwaters; 2) a proposed road across Baranof Island which would connect Baranof Warm Springs with the Medvejie valley and an extension of the existing road system south of Sitka; 3) A proposed Alaska State ferry terminal in Warm Springs Bay; and 4) a small hydropower project proposed at Tenakee Hot Springs, a small community on Chichagof Island which has hot springs similar to those at the community of Baranof Hot Springs. In addition, Northern Southeast Regional Aquaculture Association (NSRAA) of Sitka advised the City via comments on SD1 and the Scoping meetings, their concern for current salmon hatchery operations including rearing facilities and release sites on the east side of Baranof Island, in and near Takatz Bay. Because NSRAA operates hatcheries in Silver Bay near the City’s Green Lake (FERC No. 2818) and Blue Lake 18 (FERC No. 2230) Projects, and because the potentially-affected fish stocks are known to migrate throughout the waters surrounding Baranof Island, Project effects on NSRAA’s hatchery-based fish stocks will be evaluated as cumulative effects, and will be considered in establishing the Geographic Scope of cumulative effects analysis, described below. The Blue Lake project Expansion is highly likely to begin construction within the next five years. The cross-island road and ferry terminal are controversial and in any case would not be constructed for at least five years, more likely ten years. Cumulative effects of all of these actions, however, are expected to be decided upon within the likely period of the Takatz Lake Project license, if issued. 4.1.2 Cumulatively Affected Resources Based on information in the PAD, comments from scoping, and preliminary staff analysis, we have identified wildlife, recreation and aquatic resources as those which might be cumulatively affected by construction and operation of the project, for the following reasons: 4.1.2.1 Wildlife Among cumulatively affected wildlife resources, mountain goats are the most likely to be affected. The Blue Lake Project Expansion, depending on as yet undecided changes in access and hunting regulations, might be impacted by the Blue Lake Expansion because higher reservoir levels afforded by the dam raise would ease access difficulties and increase hunting pressure. Also, inundation associated with the dam raise might reduce goat habitat, particularly in the overwintering phase. Goats could be displaced from the Blue Lake basin into neighboring basins, among which is the Takatz Lake basin. Goats are also prevalent in the environs of the cross island trail, the Upper Medvejie Valley and the upper areas of Baranof River. The road would increase access to these areas, again adding hunting pressure on regional goat populations. The proposed project could affect wildlife from construction activities (such as blasting and excavation), and operation (such as increased human access on goat habitat, and potential raptor electrocution and collision from transmission lines). 4.1.2.2 Recreation The Blue Lake Expansion and the cross-island road would both have significant effects on recreation in central Baranof Island. These effects might be deemed either positive or negative depending upon which user group would be affected. Recreation opportunities would be expanded by both proposals, but land use designations in the Tongass Land Use Plan would have to be considered if all more restrictive designation were to be met. The proposed project construction and operation could affect recreation by providing recreational opportunities at Takatz Lake and by affecting existing recreational use of the Baranof Lake/Warm Springs Bay area, including tourism use of the area by tour boats and 19 recreational boaters. 4.1.2.3 Aquatic Resources Aquatic Resources might also be affected by both the Blue Lake Expansion and the cross-island road, in association with effects due to the Takatz Lake Project. The cross-island road, which might serve as the corridor for the Takatz Project transmission line, might affect the Baranof and Medvejie Rivers and water quality or water supply for the Medvejie fish hatchery and a proposed hatchery near Baranof Warm Springs. This aquatic resource, in turn, relates to anadromous fish which use Sawmill Creek which is affected by the Blue Lake project outflow. NSRAA operations take place on both coasts of Baranof Island, in areas which might be affected by the road, the Blue Lake Project and the Takatz Lake project. The proposed project could affect aquatic resources from construction activities (such as sedimentation, disturbance, and modifications to aquatic habitat), and operation (such as fluctuations in Takatz Lake and altered flows in Takatz Creek). 4.1.3 Geographic Scope Geographic scope of analysis for cumulatively affected resources is defined by the physical limits or boundaries of: (1) the proposed action's effect on the resources, and (2) contributing effects from other hydropower and non-hydropower activities within the project area. Because the proposed action would affect the resources differently, the geographic scope for each resource may vary. We have identified all of Baranof Island and southern Chichagof Island, including their near shore marine environments, as the geographic scope for cumulative effects analysis. This area comprises ADF&G Management Unit 4 for wildlife and the Sitka Management Area and a portion of the Juneau Management Area for fisheries. 4.1.4 Temporal Scope Depending on the term of an original license, the temporal scope will look 30-50 years into the future, noting effects from past and present actions, focusing on the Blue and Green Lake hydro projects, and on reasonably foreseeable future actions, primarily the Blue Lake Expansion, the cross-island road and the Baranof ferry terminal. 4.2 Resource Issues In this section, we present a preliminary list of environmental issues to be addressed in the EA. We have identified these issues, which are listed by resource area, by reviewing the City’s PAD, conducting scoping meetings, and reviewing the Commission’s record for the proposed Takatz Lake Project. After the scoping process is complete, we will review the list and determine the appropriate level of analysis needed to address each issue in the EA. Those resources identified by an asterisk (*) will be 20 analyzed for cumulative and site-specific effects. 4.2.1 Geologic and Soils Resources  Effect of project construction and operations on geology and soils resources, including spoil disposal.  Effects of project construction and operation on existing mineral claims and mining areas.  Effects of transmission line construction on geology and soil resources.  Effects of project construction and operation, including effects on the transmission line and substation, on the geothermal springs located throughout Warm Springs Bay.* 4.2.2 Water Quantity and Quality  Effects of accidental releases of fuels, lubricants, and other wastes from construction equipment and machinery on Takatz Lake, Takatz Creek, and Takatz Bay water quality.  Effects of project operations on changes to water temperature, dissolved oxygen (DO), and total dissolved gas levels of Takatz Lake and Takatz Creek.  Effects of project construction, operation, and maintenance, including effects on the transmission line, on the water quality of Takatz Lake, Takatz Creek, Takatz Bay, Baranof River, Baranof Lake, Warm Springs Bay, Medvejie River, and Medvejie Lake.*  Effects of road construction including blasting, on water quality, including heavy metals exposure.  Effects of project construction, operation, and maintenance (which includes effects on the transmission line and substation) on domestic water supply for the community of Warm Springs. 4.2.3 Aquatic Resources 21  Effects of project construction and operation (e.g., sedimentation, disturbance, modification) on the physical habitat of Takatz Lake, Takatz Creek, and Takatz Bay.  Effects of project operation and water level fluctuations on fish species and habitats in Takatz Lake.  Effects of project operation, including alterations to the existing flow regime, on fish species and aquatic habitats of Takatz Creek, including the potential for adverse effects on anadromous fish in lower Takatz Creek.  Effects of transmission line construction on fish communities in Takatz Bay, Chatham Straight, Warm Springs Bay, Baranof Lake, and Baranof River.*  Effects of electromagnetic radiation on fish and marine mammals, located along the undersea cable route. 5  Effects of the powerhouse outflow on anadromous fish and marine resources in Takatz Bay, including chum salmon homing and plankton production. 4.2.4 Terrestrial Resources  Effects of human access, blasting, excavation, and other construction activities on wildlife, including Sitka black tailed deer, brown bears, and mountain goats.*  Effects of project construction and operation on nest trees for bald eagles, and waterfowl species and habitat.  Effects of habitat loss and alteration from construction of the project on wildlife and plant species, with particular emphasis on Forest Service sensitive species and state-listed species.*  Effects of noise, improved access from project access roads, and increased human presence on wildlife, with particular emphasis on Forest Service 5 As noted previously in SD2, should the Overland Segment for transmission be selected then the issues related to the proposed Marine Segment would be moot. 22 sensitive species and state-listed species.*  Effects of project construction and operation on the control and spread of noxious weeds.  Effects of the new substation and transmission line on the potential for raptor electrocutions and collisions. 4.2.5 Threatened and Endangered Species  Effects of project construction and operation on the federally listed threatened Steller sea lion and endangered humpback whale, and potential federal candidate species. 4.2.6 Recreation Resources and Land Use  Any need for recreation facilities and public access within the project boundary to meet current or future (over the term of a license) recreation demand, including barrier-free access and the need for and benefit of interpretive opportunities (such as interpretive signs) at the project, including the Baranof Trail and Sadie Lake Trail.  The potential demand for recreational use of the project’s access road including, but not limited to, the effects of the road being open to the public year-round.*  Effects of project construction and operation on Forest Service Land Use Designations (LUD) associated with the potentially affected areas of the Tongass National Forest.  Effects of project construction and operation on existing recreational use of the Baranof Lake/Warm Springs Bay area, including tourism use of the area by tour boats and recreational boaters.*  Effects of project construction and operation on recreation opportunities, such as hiking, backpacking, bike riding, snowboarding, and off-road vehicle use.  Effect of project construction and operation on the roadless area designation for the Tongass National Forest. 4.2.7 Aesthetic Resources 23  Effects of project construction, facilities, and operation, including substation placement, on the aesthetic resources of the project area, including the Forest Service cabin on Baranof Lake and non-project land along Warm Springs Bay.  Effects of project construction noise on residents and public visitors within the project area, particularly the Warm Springs Bay vicinity. 4.2.8 Cultural Resources  Effects of project construction and operation on the project’s defined area of potential effects (APE).  Effects of project construction and operation on historic and archeological resources that are listed in or considered eligible for inclusion in the National Register of Historic Properties.  Effects of project construction and operation on properties of traditional religious and cultural importance to federally recognized tribes and native corporations that have an affiliation to the area.  Effects of project construction and operation on subsistence resources (hunting, fishing, and gathering) and associated areas. 4.2.9 Socioeconomics  Effects of project construction and operation on local, tribal, and regional economies.  Effect of project construction and operation on commercial uses in the project area, including use of the Baranof Wilderness Lodge.  Effects of project construction and operation on the existing land values for land owners in the project area.  Effects of project transmission line construction and maintenance on operations of Medvejie Hatchery.  Effects of project construction and operation on commercial outfitters and guides. 24 4.2.10 Public Safety  Effect of the project’s transmission line on public safety. 4.2.11 Developmental Resources  Effects of any recommended protection, mitigation, and enhancement measures on project generation and economics.  Effects of project construction and operation on the project’s economics under the applicant’s proposal and action alternative(s). 5.0 POTENTIAL STUDIES The City’s proposed studies are summarized in the following table: Table 2. The City’s Potential Studies. (Source: City and Borough of Sitka Electric Department, PAD, 2009) Resource Area and Issue Summary of Proposed Study Geologic and Soil Resources Geotechnical study Conduct a query with the U.S. Bureau of Land Management for any mineral claims prior to building any structures or otherwise blocking access to potentially valuable deposits. Water Quality and Quantity Water quantity study Study will include hydrologic studies of stream flow in the potentially affected streams and seasonal lake levels in potentially affected lakes. These studies may be based on field data or data synthesized from comparison with measured data in nearby basins. Water quality study Study will focus on characterization of the temperature, DO, dissolved solids, and clarity (turbidity) of waters affected by the project. These 25 water parameters are measured either continuously or periodically (seasonally, daily or weekly), using modern equipment capable of high accuracy and reliability. Water quality surveys will be conducted on Takatz Lake, Takatz Creek, Baranof Lake, Baranof Creek, Baranof River, and the Medvejie watershed. Aquatic Resources Aquatic resource studies Studies include conducting baseline surveys of fish species, their habitats and general life histories in the potentially affected Takatz Lake, Takatz Creek, Takatz Bay, Chatham Straight, Warm Spring Bay, Baranof Lake, Baranof Creek, and the Medvejie watershed. Study plans for these surveys will be developed in consultation with state and federal resource agencies, including Alaska Department of Fish and Game (ADF&G), Alaska Department of Environmental Conservation (ADEC), Forest Service, National Marine Fisheries Service (NMFS), and U.S. Fish and Wildlife Service (FWS). Takatz Lake and Creek: Takatz Lake and Takatz Creek fisheries studies may include, but not be limited to, lake and tributary observations and various capture techniques to determine the fish species present and their relative abundance. Baranof Lake and Baranof Creek: Baranof Lake and Baranof Creek fisheries studies may include, but not be limited to, lake and tributary observations and various capture techniques to determine the fish species present and their relative abundance. Marine Areas: Studies in these areas will seek to generally determine the distribution and abundance of resident and anadromous marine fish species, and to the extent possible, of marine invertebrate and botanical resources in areas potentially affected by the project’s submarine transmission line. Medvejie Drainage: Baranof Lake and Baranof River fisheries studies may include, but not be limited to, lake and tributary observations and various capture techniques to determine the fish species present and their relative abundance. Terrestrial Resources Wildlife study The study consists of wildlife surveys that the City proposes to conduct during any licensing period. All wildlife-related study plans will be developed 26 in association with Alaska state and federal resource agencies, including Forest Service, ADF&G, FWS, NGOs, and tribes. Typically, wildlife surveys would include: (1) ground surveys to determine large mammal habitat utilization and food habits; (2) small mammal trapping, to determine distribution and relative abundance of small mammals; and (3) general visual observations of birds, bird calling, and other forms of documentation. Botanical study The study consists of baseline surveys for potentially affected botanical resources, according to study plans approved by the Forest Service, ADF&G and perhaps other agencies. Typically, baseline plant surveys include: (1) aerial inventories of vegetative type, primarily from existing imagery; (2) foot surveys, to ground-truth the aerial inventories; (3) a preliminary jurisdictional determination, to determine location, type, function and extent of wetlands, uplands, and water of the US in the project area; and (4) prior to construction, sensitive plant surveys according to Forest Service prescriptions in potentially affected areas delineated in the project final design. Threatened and Endangered Species Threatened and Endangered Species The Commission granted the City’s request to be designated the non-federal representative for section 7 consultation under the Endangered Species Act. The City will consult with NMFS and FWS prior to commencement of field or literature surveys to determine federally listed species and candidate species. In the course of wildlife surveys, the City will note and document in reports the species surveyed. Recreation Resources and Land Use Recreation and Land Use Resources The City will research the Tongass Land Use Management Plan to determine existing LUD’s and to align those designations with the various project features and activities throughout the project area. The City will consult with the Forest Service to determine the need for and extent of surveys of current recreation use within the various potentially affected areas. In subsequent reports and any licensing documents, the City will determine the potential effects of project construction and operation on recreation opportunities and use levels. 27 Aesthetic Resources Aesthetic resource study The City will research existing aesthetic resource information, including existing Forest Service plans, to distinguish aesthetic impacts in the various potentially-affected areas. Viewshed analysis may be required to evaluate effects in different areas. All constructed project features will be evaluated relative to Forest Service and other stakeholder recommendations, terms, conditions, or prescriptions for maintenance of aesthetic values from various viewing points. Cultural Resources Cultural resource study The City will retain an approved cultural resources specialist to inventory and report on cultural resources in a defined APE, which might be affected by project-related construction, road building, or other ground disturbance. These surveys will be in two stages: Stage 1 will be less- intensive reconnaissance surveys designed to define the direct and indirect impact area of the project and the potential of the areas for containing archaeological sites. Stage 2 surveys will be conducted in those areas identified in the Stage 1 surveys as having a reasonable likelihood of containing archaeological sites. The scope of all surveys work will be determined in consultation with the Alaska State Historic Preservation Office, the Forest Service, affected tribes, and Commission staff. Socioeconomic Socioeconomics Socioeconomics studies typically seek to determine: (1) effects of the project’s generation on local, tribal, or regional economies and (2) effects of project construction and operation on local economic uses such as recreation and commercial fishing. The City, in separate reports and/or in any future licensing documents, will document the economic effects of project generation both now and throughout the licensing period. The City will also, using information from recreation, aquatic resources and other study surveys described above, determine economic effects on guide services, recreation economics, and commercial fisheries. 28 6.0 INFORMATION REQUESTED We are asking federal, state, and local resource agencies, federally recognized tribes and native corporations, NGOs, and the public to forward to the Commission any information that will assist us in conducting an accurate and thorough analysis of the project-specific and cumulative effects associated with licensing the Takatz Lake Hydroelectric Project. The types of information requested include, but are not limited to:  information, quantitative data, or professional opinions that may help define the geographic and temporal scope of the analysis (both site-specific and cumulative effects), and that helps identify significant environmental issues;  identification of, and information from, any other EA, EIS, or similar environmental study (previous, on-going, or planned) relevant to the proposed licensing of the project;  existing information and any data that would help to describe the past and present actions and effects of the project and other developmental activities on environmental and socioeconomic resources;  information that would help characterize the existing environmental conditions and habitats;  the identification of any federal, state, or local resource plans, and any future project proposals in the affected resource area (e.g., proposals to construct or operate water treatment facilities, recreation areas, water diversions, timber harvest activities, or fish management programs), along with any implementation schedules);  documentation that the proposed project would or would not contribute to cumulative adverse or beneficial effects on any resources. Documentation can include, but need not be limited to, how the project would interact with other projects in the area and other developmental activities; study results; resource management policies; and reports from federal and state agencies, local agencies, federally recognized tribes and native corporations, NGOs, and the public; and  documentation showing why any resources should be excluded from further study or consideration. 29 The requested information and comments should be submitted in writing to the Commission no later than July 19, 2010; all filings must clearly identify the following on the first page: Takatz Lake Hydroelectric Project No. 13234-001. Address all communications to: Kimberly D. Bose, Secretary Federal Energy Regulatory Commission 888 First Street, N.E., Room 1A Washington, DC 20426 All filings sent to the Secretary of the Commission should contain an original and eight copies. Failure to file an original and eight copies may result in appropriate staff not receiving the benefit of your comments in a timely manner. Comments may be filed electronically via the Internet in lieu of paper. See 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission’s web site (http://www.ferc.gov/docs- filing/ferconline.asp) under the “e-Filing” link. For assistance, please contact FERC Online Support at FERCOnlineSupport@ferc.gov or toll free at 1-866-208-3676, or for TTY, (202) 502-8659. The Commission strongly encourages electronic filings. Register online at http://www.ferc.gov/docs-filing/esubscription.asp to be notified via email of new filings and issuances related to this or other pending projects. For assistance, please contact FERC Online Support. In addition, there is a “Quick Comment” option available, which is an easy method for interested persons to submit text only comments on a project. The Quick-Comment User Guide can be viewed at http://www.ferc.gov/docs-filing/efiling/quick-comment- guide.pdf. Quick Comment does not require a FERC eRegistration account; however, you will be asked to provide a valid email address. All comments submitted under either eFiling or the Quick Comment option are placed in the public record for the specified docket. Any questions concerning the licensing process, or how to file written comments with the Commission should be directed to Joseph Adamson at (202) 502-8085 or joseph.adamson@ferc.gov. Additional information about the Commission’s licensing process and the Takatz Lake Hydroelectric Project may be obtained from the Commission’s website, www.ferc.gov. 7.0 EA PREPARATION SCHEDULE At this time, we anticipate the need to prepare a draft and final EA. The draft EA will be sent to all persons and entities on the Commission’s service and mailing lists for 30 the Takatz Lake Project. The EA will include our recommendations for operating procedures, as well as environmental protection, mitigation, and enhancement measures that should be part of any license issued by the Commission. All recipients will then have 30 days to review the EA and file written comments with the Commission. All comments on the draft EA filed with the Commission will be considered in preparation of the final EA. The major milestones, including those for preparing the EA, are as follows:6 Major Milestone Target Date Scoping Meetings October 2009 License Application Filed August 31, 2011 Ready for Environmental Analysis Notice Issued November 2011 Deadline for Filing Comments, Recommendations and Agency Terms and Conditions/Prescriptions January 2012 Draft EA Issued May 2012 Comments on Draft EA Due June 2012 Final EA Issued September 2012 If Commission staff determines that there is a need for additional information or additional studies, the issuance of the Ready for Environmental Analysis notice could be delayed. If this occurs, all subsequent milestones would be delayed by the time allowed for the City to respond to the Commission’s request. 8.0 PROPOSED EA OUTLINE The preliminary outline for the Takatz Lake Project EA is as follows: TABLE OF CONTENTS LIST OF APPENDICES LIST OF FIGURES LIST OF TABLES ACRONYMS AND ABBREVIATIONS EXECUTIVE SUMMARY 1.0 INTRODUCTION 6 This schedule assumes that a draft and final EA would be prepared. If a draft and final EIS is prepared, the target dates for comments on the draft EIS and deadline for filing modified agency recommendations may need to be revised. 31 1.1 Application 1.2 Purpose of Action and Need for Power 1.3 Statutory and Regulatory Requirements 1.3.1 Federal Power Act 1.3.1.1 Section 18 Fishway Prescriptions 1.3.1.2 Section 4(e) Conditions 1.3.1.3 Section 10(j) Recommendations 1.3.2 Clean Water Act 1.3.3 Endangered Species Act 1.3.4 Coastal Zone Management Act 1.3.5 National Historic Preservation Act 1.3.6 Magnuson-Stevens Fishery Conservation and Management Act 1.4 Public Review and Comment 1.4.1 Scoping 1.4.2 Interventions 1.4.3 Comments on the Application 1.4.4 Comments on Draft EA 2.0 PROPOSED ACTION AND ALTERNATIVES 2.1 No-action Alternative 2.2 Proposed Action 2.2.1 Proposed Project Facilities 2.2.2 Project Safety 2.2.2 Proposed Project Operation 2.2.3 Proposed Environmental Measures 2.2.4 Modifications to Applicant’s Proposal—Mandatory Conditions 2.3 Staff Alternative 2.4 Staff Alternative with Mandatory Conditions 2.5 Alternatives Considered but Eliminated from Detailed Study 3.0 ENVIRONMENTAL ANALYSIS 3.1 General Description of the River Basin 3.2 Scope of Cumulative Effects Analysis 3.2.1 Geographic Scope 3.2.2 Temporal Scope 3.3 Proposed Action and Action Alternatives 3.3.1 Geologic and Soil Resources 3.3.2 Aquatic Resources 3.3.3 Terrestrial Resources 3.3.4 Threatened and Endangered Species 3.3.5 Recreation and Land Use 3.3.6 Cultural Resources 3.3.7 Aesthetic Resources 3.3.8 Socioeconomics 32 3.3.9 Public Safety 3.4 No-action Alternative 4.0 DEVELOPMENTAL ANALYSIS 4.1 Power and Economic Benefits of the Project 4.2 Cost of Environmental Measures 4.3 Comparison of Alternatives 5.0 CONCLUSIONS AND RECOMMENDATIONS 5.1 Comparison of Effects of Proposed Action and Alternatives 5.2 Comprehensive Development and Recommended Alternative 5.3 Unavoidable Adverse Effects 5.4 Recommendations of Fish and Wildlife Agencies 5.5 Consistency with Comprehensive Plans 6.0 FINDING OF NO SIGNIFICANT IMPACT (OR OF SIGNIFICANT IMPACT) 7.0 LITERATURE CITED 8.0 LIST OF PREPARERS APPENDICES 9.0 COMPREHENSIVE PLANS Section 10(a)(2) of the FPA, 16 U.S.C. section 803(a)(2)(A), requires the Commission to consider the extent to which a project is consistent with federal and state comprehensive plans for improving, developing, or conserving a waterway or waterways affected by a project. We have identified and reviewed the plans listed below that may be relevant to the proposed Takatz Lake Project. Agencies are requested to review this list and inform the Commission staff of any changes. If there are other comprehensive plans that should be considered for this list that are not on file with the Commission, or if there are more recent versions of the plans already listed, they can be filed for consideration with the Commission according to 18 C.F.R. 2.19 of the Commission’s regulations. Please follow the instructions for filing a plan at http://www.ferc.gov/industries/hydropower/gen-info/licensing/complan.pdf. Alaska  Alaska Department of Fish and Game. 1989. Northwest area plan for state lands. Fairbanks, Alaska. February 1989.  Alaska Department of Fish and Game. 1998. Catalog of waters important for spawning, rearing or migration of anadromous fishes. November 1998. Juneau, Alaska. 33  Alaska Department of Fish and Game. 1998. Atlas to the catalog of waters important for spawning, rearing or migration of anadromous fishes. November 1998. Juneau, Alaska.  Alaska Department of Natural Resources. 2004. Alaska's Outdoor Legacy: Statewide Comprehensive Outdoor Recreation Plan (SCORP), 2004-2009. Juneau, Alaska. July 2004. Federal  Forest Service. 2008. Tongass National Forest land and resource management plan. Department of Agriculture, Ketchikan, Alaska. January 2008.  U.S. Fish and Wildlife Service. Undated. Fisheries USA: the recreational fisheries policy of the U.S. Fish and Wildlife Service. Washington, D.C. 10.0 FERC OFFICIAL MAILING LIST If you want to receive future mailings for this project, please send your request by mail to: Kimberly D. Bose, Secretary, Federal Energy Regulatory Commission, 888 First Street, NE, Room 1A, Washington, DC 20426. All written requests to be added to the Commission’s mailing list must clearly identify the following on the first page: “Takatz Lake Hydroelectric Project No. 13234-001.” You may use the same method to remove your name from the Commission’s mailing list for this project. Also, please notify the City if you would like to be placed on their Distribution List for this project. Register online at http://www.ferc.gov/esubscribenow.htm to be notified via email of new filings and issuances related to this or other pending projects. For assistance, please contact FERC Online Support at FERCOnlineSupport@ferc.gov or toll free (806) 208-3676, or for TTY, (202) 502-8659. Appendix I AGENCY/PARTY COMMENTS RESPONSE TABLE 34 US Forest Service (Forest Service) Comments of December 7, 2009 Comment Number Comment Summary Response and Location Forest Service 1 Add Alaska Native Claims Settlement Act native corporations to list of participants. Section 2.1 has been modified. Forest Service 2 Include transmission routing studies under List of Potential Studies. The City is reviewing all study request comments and will be working together with stakeholders to address study needs throughout the ALP. Forest Service 3 Describe clearing width of transmission-line corridor. Clearing width detail will be available once more advanced design is finalized in the license application. Forest Service 4 Describe dimensions of running surfaces of roads and bridges. Details will be available once more advanced design is finalized in the license application. Forest Service 5 Address agreements between City of Sitka and State of Alaska regarding construction of the cross-island road. All such agreements will be addressed by the stakeholders during the ALP. Forest Service 6 Provide details on access corridor road specifications. Details of access corridor will be available once more advanced design is finalized in the license application. Forest Service 7 Include information necessary to identify mitigation measures in NEPA document. We do not evaluate protection and enhancement measures in this SD2. The EA will identify and analyze protection, mitigation, and enhancement measures for the project. Forest Service 8 Add “and operation” to the second bullet under section 4.2.2 Water Quantity and Quality. Section 4.2.2 has been updated. 35 Forest Service 9 Add “Effects to aquatic resources, including habitat, for all potentially affected water bodies,” to section 4.2.2 Water Quantity and Quality. Section 4.2.3 has been updated. Forest Service 10 Analyze effects to threatened, endangered, and sensitive species under Terrestrial Resources. This issue will be addressed under section 4.2.5, Threatened and Endangered Species. Forest Service 11 Provide a strategy to control and manage noxious weeds. Added noxious weeds as issue to section 4.2.4, Terrestrial Resources. Forest Service 12 Analyze effects of project development on recreational uses. Issue added to section 4.2.6, Recreation Resources and Land Use. Forest Service 13 Add “including, but not limited to, effects of road being open to public year-round, seasonally, etc.” to the second bullet under section 4.2.6 Recreation Resources and Land Use. Section 4.2.6 has been modified. Forest Service 14 Replace “Indian tribe” in the third bullet under section 4.2.8 Cultural Resources with: “Federally Recognized Tribes and ANSCA native corporations that have an affiliation to the area.” Section 4.2.8 has been updated. Forest Service 15 Add language concerning the potential shift in use of commercial outfitters and guides under section 4.2.9 Socioeconomics. This issue is already identified under section 4.2.6, Recreation Resources and Land Use. Forest Service 16 Create new section 4.2.10 for Subsistence. This issue is addressed under section 4.2.8, Cultural Resources. Forest Service 17 Develop timber management plan. The City intends to work collaboratively with the Forest Service and other stakeholders to develop appropriate protection and enhancement measures throughout the ALP. Forest Service 18 The Forest Service looks forward to reviewing study plans, and Study plan elements will be addressed during detailed study 36 subsequent study results. plan development with stakeholders throughout ALP. Forest Service 19 Forest Service requests an evaluation of how the project affects roadless area characteristics. Roadless area issues will be addressed in section 4.2.6, Recreation Resources and Land Use. Forest Service 20 Request adding certain federally recognized tribes and native corporations to mailing list. Although it is encumbered upon the party to request that it be added to or deleted from the Commission mailing and service lists, staff has already revised the mailing list to include federally recognized tribes and native corporations, as they requested. Northern Southeast Regional Aquaculture Association (NSRAA) Comments of December 7, 2009 Comment Number Comment Summary Response and Location NSRAA 1 Concern about powerhouse outflow on spring chum rearing. Included in section 4.2.3, Aquatic Resources. NSRAA 2 Discuss effect of flow regime changes on zooplankton production and chum homing to Takatz Bay. Included in section 4.2.3, Aquatic Resources. NSRAA 3 Concern about road construction and major excavations on water quality and fish production. Included in section 4.2.2, Water Quantity and Quality. NSRAA 47 Concern about the effects of underwater transmission line location. Included in section 4.2.3, Aquatic Resources. NSRAA 5 Concern about construction effects on water quality in Baranof River Valley. Included in section 4.2.2, Water Quantity and Quality. NSRAA 6 Concern about the potential water quality impacts in Medvejie Lake and on the Medvejie Hatchery. Included in section 4.2.2, Water Quantity and Quality. 37 NSRAA 7 Concern about increased public traffic to hatchery from increased road access. Included in section 4.2.6, Recreation Resources and Land Use. NSRAA 8 Concern about the effects of transmission interconnection to Green Lake Project lines on groundwater, etc. near Medvejie Hatchery. Effects of project, including transmission line construction and maintenance, added to section 4.2.2, Water Quantity and Quality NSRAA 9 Concern about transmission line construction and maintenance on hatchery operations. Included in section 4.2.9, Socioeconomic Resources 7 Sitka Conservation Society (SCS) Comments of November 24, 2009 Comment Number Comment Summary Response and Location SCS 1 Request energy demand, carbon emissions, and alternative energy source (other than Takatz Lake hydroelectric development) analyses. Requests for studies will be addressed by the City through the pre-filing ALP study planning process. SCS 2 Request further studies and analyses on transmission corridor impacts; impacts on Baranof Warm Springs; alternative routes for the transmission line; and impacts of road construction/utility corridor on water quality, aesthetic, and recreation. Requested analyses will be addressed under resource issues identified in SD2. Requests for studies will be addressed by the City through the pre-filing ALP study planning process. Baranof Property Owners Association (BPOA) Comments of December 8, 2009 Comment Number Comment Summary Response and Location BPOA 1 Object to the development of the We do not evaluate the 7 As noted previously in SD2, should the Overland Segment for transmission be selected then the issues related to the proposed Marine Segment would be moot. 38 project, particularly within the Baranof Warm Springs Bay area appropriateness of the project in this SD2. A determination on whether the proposed project would be in the public interest would be made by the Commission after staff evaluation of all reasonable alternatives, proposed and recommended protection, mitigation, and enhancement measures, and associated effects in the EA. BPOA 2 Character of Baranof Warm Springs discussed. The effects of the project on Baranof Warm Springs are reflected in multiple issues throughout the SD2. BPOA 3 Concern about the effects (i.e., recreation, aesthetics, socioeconomics, and human health) of transmission lines through the Baranof Warm Springs community. These issues are included in the SD2 and will be evaluated in the EA. BPOA 4 Concern with the future development of State of Alaska Department of Transportation (DOT) road from Sitka to Baranof Warm Springs and transmission line on the Baranof Warm Springs area. Would request no road development and alternative transmission line route for power sales. We have included the effects of potential road development by the State of Alaska DOT in section 4.1, Cumulative Effects. The EA will evaluate the environmental effects of any potential road or transmission line development. BPOA 5 Concern that project is out of date, since the design for the Takatz Lake Hydroelectric Project was developed in the 1960s. FERC process requires full evaluation of purpose and need for the project, relative to current and future conditions. BPOA 6 Concern about the effects of the dam on tourism and wildlife. These issues are identified in section 4.2 of SD2 and will be evaluated in the EA. BPOA 7 Opposed to use of the ALP because it is an abbreviated process, preventing adequate review of the proposed project. The ALP includes all FERC regulatory requirements and promotes extensive collaboration among the 39 applicant and all stakeholders. BPOA 8 Discussed City of Sitka’s need for power for the project. Need for the project power will be evaluated in the EA. Alaska Department of Fish and Game (ADF&G) Comments of December 8, 2009 Comment Number Comment Summary Response and Location ADF&G 1 Add detailed baseline studies of fish, wildlife, etc. Any requests for studies will be addressed by the City through the pre-filing ALP study planning process. ADF&G 2 Pre-, during-, and post- construction plans are needed. Details of construction plans will be available once more advanced design are finalized in the license application. ADF&G 3 “Baranof Creek” should be replaced with “Baranof River”. Changes made throughout SD2. ADF&G 4 Evaluate alternative transmission routes. During the ALP, alternatives to the proposed project will be identified. All reasonable alternatives for transmission line alignment will be evaluated in the EA. ADF&G 5 Add detail of outlet structure, spillway, and operations relative to instream flow. Details of outlet structure, spillway, and their operation will be available once more advanced design is finalized in the license application. 40 ADF&G 6 Add information on spoils disposal, and a Sedimentation and Erosion control plan. We have included spoils disposal in section 4.2.1 of the SD2. Any recommendations for sediment and erosion control will be analyzed in the EA. ADF&G 7 Concern about the location of the powerhouse discharge and its effects on water quality. Project effects on water quality are included in section 4.2.2, Water Quantity and Quality. ADF&G 8 Design of proposed tailrace requested. To be determined in further design studies. ADF&G 9 Add the proposed Baranof Hatchery to cumulative effects analysis. We have included the effects of potential commercial fish hatchery construction and operation in section 4.1, Cumulative Effects. ADF&G 10 Include effects on geothermal resources. Issue included in section 4.2.1, Geologic and Soil Resources. ADF&G 11 Add soils stability information and erosion control. Details of soils stability and erosion control will be available once more advanced design are finalized in the license application. ADF&G 12 Add description of soils, faults, active or abandoned mines etc. and identify unstable soils that could be affected by project reservoir fluctuations. Details of soils analysis will be available once more advanced design are finalized in the license application. ADF&G 13 Comments related to study and analysis of hydrology and water quality relative to project operations Requests for studies will be addressed by the City through the pre-filing ALP study planning process. ADF&G 14 Comments requesting studies and analysis for fisheries resources in Takatz Lake and Creek Requests for studies will be addressed by the City through the pre-filing ALP study planning process. ADF&G 15 Concern about project-related fluctuation of Takatz Lake on fish. Issue included in section 4.2.3, Aquatic Resources. ADF&G 16 Need for water allocation data. Water quantity effects are included in section 4.2.2, Water 41 Quantity and Quality ADF&G 17 Need to analyze construction and operations impacts on fish and wildlife. Issue included in sections 4.2.3 and 4.2.4 of SD2. ADF&G 18 Need to study and analyze impact on terrestrial resources. Issue included in section 4.2.4, Terrestrial Resources. ADF&G 19 Need to analyze and study effects on socioeconomics, including the potential increase of recreational opportunities. The potential project effects on these resources are included in the specific resource sections of the SD2. Comments of James Brennan (JB), dated November 18, 2009 Comment Number Comment Summary Response and Location JB 1 Commented that the project would be more expensive than currently estimated; and cannot be justified by Sitka electrical demand. Project cost and need for power will be analyzed in EA. JB 2 Avalanche damage and repair to the proposed transmission line during project operation. Transmission line safety and maintenance will be further evaluated in design and operation studies. JB 3 Concern about the effects of road building and existence near Baranof Lake and River. The potential effects of any project roads on Baranof Lake and River are included in the resource issues in section 4.2 of the SD2. JB 4 Concern about the costs of transmission line and tunnel, and how they are not in accord with Sitka needs. Project cost and need for power will be analyzed in EA. JB 5 Concern about the effects on Takatz Bay shellfish and finfish resources. Issue included in section 4.2.3, Aquatic Resources JB 6 Concern about the effects of transmission line on Baranof Bay and community of Baranof Warm Springs. The potential effects of any project transmission line on Baranof Bay and Baranof Warm Springs are included in the resource issues in section 4.2 of 42 the SD2. JB 7 Concern about the effects of project construction and maintenance (transmission line and road) on the aesthetic and recreational resources in the Baranof Warm Springs Bay area. Issue included in section 4.2.6 Recreation and Land Use and section 4.2.7 Aesthetic Resources. FERC COMMUNICATIONS PROTOCOL TAKATZ LAKE HYDROELECTRIC PROJECT PROJECT No. 13234-001 Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 1 COMMUNICATIONS PROTOCOL Takatz Lake Hydroelectric Project FERC No. 13234-000 City and Borough of Sitka Electric Department November, 2008 INTRODUCTION The City and Borough of Sitka Electric Department (“City”) holds a Preliminary Permit (“Permit”) from the Federal Energy Regulatory Commission (FERC, Commission) for the proposed Takatz Lake hydroelectric project (“Project”), FERC No. 13234-000-AK. The Permit preserves the City’s rights to conduct feasibility studies for the Project for a period of 36 months beginning September 19, 2008, the Permit’s issuance date. The Permit included the requirement for the City to utilize the Commission’s Integrated Licensing Process (ILP) as described in 18 CFR, Chapter 1, Section 5.5 of the Federal Regulations. The Permit also states that an Applicant may utilize either of two other licensing methods, the Traditional (TLP) or the Alternative Licensing Process (ALP) on approval by the Commission. For the Takatz Lake Project, the City has decided to request use of the ALP. An applicant’s request for use of ALP must include documentation of approval by Project Stakeholders, of both the licensing process and a Communications Protocol (CP) governing communications during the pre-filing period. LICENSING PROCESS DESCRIPTIONS ILP The efficiencies expected to be achieved through the ILP are founded in three fundamental principles: • Early issue identification and resolution of studies needed to fill information gaps, avoiding studies post-filing; • Integration of other stakeholder permitting process needs; and • Established time frames to complete process steps for all stakeholders, including the Commission. Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 2 ALP As part of the alternative licensing process, an applicant can: • Tailor the pre-filing consultation process to the circumstances of each case; • Combine into a single process the pre-filing consultation process and environmental review processes under the National Environmental Policy Act and other statutes; and • Allow for preparation of a preliminary draft environmental assessment by an applicant or an environmental impact statement by a contractor chosen by the Commission and funded by the applicant. Having successfully utilized the ALP for the Blue Lake Hydro Project (FERC No. 2230) relicensing, the City believes it can achieve the objectives of ILP while implementing the ALP on the Takatz Lake Project. Under the ALP, the City would, with FERC direction and approval, conduct NEPA Scoping (the public participation process to solicit comments on environmental issues) and prepare and submit a Preliminary Draft Environmental Assessment (PDEA) with the license application. The Final EA, which will serve as the basis for conditions of the new license, will be prepared by the FERC after their independent review of the PDEA and project record. PARTICIPATING in the LICENSING PROCESS Under the ALP, the licensing process is open to the general public and their participation is encouraged. A Participant List will be compiled by the City and expanded as new Participants request inclusion in the ALP. The ALP affords Participants the opportunity to interact with the licensing process at several distinct points, including: 1) public meetings; 2) coordinated meetings 3) document review and comment; and 4) access to general information regarding process, schedule, and status. The City will use several means to assure access to licensing material, as described in the following sections. PUBLIC REFERENCE FILES There will be two public reference files, one in Sitka and the other at the Commission offices in Washington D.C. The reference files will be maintained on a monthly basis and will include, but not be limited to: semi-annual progress reports (described below), study plans and reports, preliminary data files, meeting announcements, agendas and summaries, draft and final technical reports, draft and final EA’s and license applications, Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 3 written correspondence and telephone discussion notes. The addresses of the Public Reference Files are: City and Borough of Sitka, Electric Department 105 Jarvis Street Sitka, Alaska, 99835 and Federal Energy Regulatory Commission Public Reference Room, Room 2-A Attn: Secretary 888 First Street, N.E. Washington, D.C. 20426 All materials in the reference files will be available for review and copying by request. All communications added to the Public Reference File will be available to the public consistent with the public records procedures set forth in the Freedom of Information Act. Most materials will also be available on the FERC website (www. ferc. gov). Individual project information is available on the FERC website at the at the elibrary link by inputting the Project number (P-13234) THE TAKATZ LAKE PROJECT LICENSING WEBSITE The City will develop and maintain a Takatz Lake Project licensing Website at which most Project material be made available. The licensing Website will contain: • Project Description; • Description of the licensing Process and ALP; • Licensing Schedule; • Notices of Public and Coordinated Meetings; • Notices of Availability of Documents for Participant Review; • Semi-Annual Progress Reports; • Monthly Status Updates; • Current Participant List; • Tracking File (record of all licensing transactions) • Other features, as deemed necessary. NEED for TIMELY NOTIFICATION and REVIEW For this process to succeed, it is important that the interaction opportunities are announced to the Participants, and that the Participants provide timely comment and information at each opportunity. It is also important that Participants have sufficient access to general information. In the following, we describe the protocols to address these needs. Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 4 MEETINGS and SITE VISITS Meeting events (Scoping and others) to present information and obtain comments from the public and stakeholders will be held at various points during the licensing. Two public meetings will be held during the Project licensing. The first event, consisting of two “Initial Stage Consultation” meetings (one in Juneau and one in Sitka) and a site visit, will tentatively be held during Spring, 2009. Notice of the meetings and site visit will be placed in the Sitka Sentinel and the Juneau Empire newspapers more than 15 days prior to the events. The City will prepare draft summaries of the Initial Consultation meetings and site visit, and circulate them among attendees for review and comment. The other scheduled licensing meeting event will be the Scoping meeting and site visit, presently scheduled for Fall, 2009. Notice of the Scoping meeting and site visit will be posted on the Takatz Lake Project Website (described above), on the Sitka Electric Department and City Administration Building Bulletin Boards and published in local newspapers, specifically the Juneau Empire and the Sitka Sentinel. The Commission will also publish notice of the Scoping meeting and site visit in the Federal Register. All notices will be posted at least 30 calendar days in advance of the meeting date. The City will also serve notification of the Scoping meeting and site visit via e-mail to all those on the Project's Participant List. The City will transcribe the Scoping meeting on videotape, and tape copies will be available to all Participants on request. Comments in the approved meeting summary will be considered the speaker’s formal comments if they choose not to provide written comments. Scoping Participants will be given at least 30 days to provide written comments on the Scoping meeting and related written material. COORDINATED MEETINGS Meetings between and among licensing Participants may occur on an "as needed" basis. If a City representative is present at the meeting, the City will prepare a meeting summary. If the City is not present at the meeting, the person who requested the meeting will prepare the meeting summary. MEETING SUMMARIES Draft Meeting Summaries for all public and coordinated meetings will be circulated to all meeting Participants for review and comment within 15 days after the meeting. Comments will be incorporated into a Final Meeting Summary, with the goal of agreement among all Participants on its content. Deadlines for preparation of drafts, returning comments, and submittal of a final summary will be agreed upon by Participants at each meeting. Final Meeting Summaries should be e-mailed to the City at the contact address on page 6, for inclusion in the City’s Tracking File and Licensing Website. All Draft and Final Meeting Summaries will be available on the Licensing Website and in hard copy by request. Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 5 DOCUMENT AVAILABILITY MAJOR DOCUMENTS Throughout the licensing process, Participants will be afforded opportunity to review and comment on documents prepared in the course of the licensing process. While it is not possible to envision an exact list of documents for review, the City expects to prepare and distribute the major documents shown in Table 1 prior to the application for license. Most licensing-related written material will be available in electronic format and will be electronically distributed directly to Participants via email with attachment. Documents will be in MS Word or Adobe pdf format. Much of the same material will be available through the Takatz Lake Project Licensing Website. In all cases, however, Participants may request printed copies of major documents. Printed copies of Scoping Documents, the Draft Application, Preliminary Draft EA or EIS, FERC Draft EA and FERC Order Issuing License will also be available at the public library in Sitka and the state library in Juneau. Most major documents will be available in either text or Adobe pdf. on the FERC website. To access documents on this website, go to ferc.us.gov and then to “elibrary” on the home page. This will open a search page offering several search options. The review period for major documents will be no less than 30 days, unless longer periods are required by FERC regulations, or if individual agencies formally request more review time. Table 1. Major documents to be made available for review during Takatz Lake Project licensing. Document Name Expected Date of Issue Description Pre Application Document (PAD) January-February, 2009 Document with Project description, licensing schedule and preliminary resource issues. Study Plans Spring, 2009 Describe detailed objectives, methods and required reporting for various environmental field and office studies Scoping Document I (SD1) Fall, 2009 A document describing the Project, licensing process, and environmental and economic issues related to licensing Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 6 Study Reports 2009-20012 Present results of the environmental studies, usually on an annual basis Draft Application for License Fall, 2010 Documents describing various design and operation aspects of the project, as proposed for licensing Preliminary Draft EA Fall, 2010 Accompanies Draft Application, describes existing environment, licensing impacts and mitigation proposals. Final License Application Sept. 2011 Incorporates all agency comments and presents Applicant’s Preferred Alternative and proposed PM&E measures. FERC Draft EA 2012 FERC-prepared EA noting issues, impacts, mitigation and recommendations. FERC Order Issuing License Dec. 2013 Contains FERC’s Final EA and Licensing Order as well as License Articles and other Conditions. MINOR DOCUMENTS and CORRESPONDENCE Throughout the licensing process, the City will communicate frequently with Participants, individually and collectively. These communications may include written material such as meeting notices and summaries or other small documents relevant to the communications. Minor documents (with exception of Status Reports) will become part of the public record after review, editing and approval by participating parties. Transfer of minor documents will be primarily in the form of e-mail, often with attached files, and via the Takatz Lake Project Website. The City will follow certain e-mail transmittals with a phone message check to assure that the messages were received and in readable format. Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 7 COMMUNICATIONS PROTOCOLS In this section, we describe conditions governing communications among licensing Participants. The Protocols are intended to assure that interactions are appropriate, effective and properly documented. WRITTEN COMMUNICATIONS All written communications that need to be part of the public record, including comment letters, progress reports, fax communications, meeting summaries, and teleconference summaries, or in which any party intends to become part of the formal record, should be mailed to: City and Borough of Sitka Electric Department Attn: Christopher Brewton, Utility Director 105 Jarvis Street Sitka, Alaska, 99835 Phone: 907-747-1886 Fax: 907-747-3208 Email: chrisb@cityofsitka.com With a copy to deano@cityofsitka.com All written communications must have the following clearly displayed on the first page, preferably in the “Subject” line of the correspondence: Takatz Lake Hydroelectric Project (FERC No. 13234) Written communications must display deadlines for comments or other actions (when applicable) and should reference the corresponding activity of the licensing process associated with the written communication (for example., “Comments on Scoping Document I”, “Summary of Study Planning Meeting”, etc.) in the “Subject” line of the correspondence. Communications must indicate where to submit responses, when applicable. Copies of all written communications will be placed in the Public Reference File. A distribution mailing list will be sent with each formal correspondence or document that shows all recipients who were sent a copy. The Commission will from time to time advance the number following the Project number to indicate a different licensing action phase (for example, FERC No. 13234-001, 13234-002, etc.) Participants should check Commission and the City correspondence closely to assure that the proper Project numbers are identified when referencing a particular document. Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 8 TELECONFERENCE COMMUNICATIONS Periodic teleconference calls among licensing Participants may occur on an “as-needed basis”. If the communication is between an agency and either the City or the Commission, the party initiating the call will forward a written summary of the call to the City at the contact address on page 6, to be included with the Public Reference File(s). Participants will be noticed and given the opportunity to participate in any communications the City makes with FERC on substantive matters concerning the licensing. Documentation of teleconference calls between the City and the Commission will be included in the Public Reference File, with a summary written by the party initiating the call. INTER/INTRA RESOURCE AGENCY STAFF COMMUNICATIONS Written communications, meetings, telephone conversations, or other types of communications within or between State or Federal resource agency staff concerning the Takatz Lake Project licensing are not subject to the scheduling, notification, and documentation requirements of previous sections this CP. It is understood that such communications will not be part of the licensing record unless they are submitted to the Commission by a participating agency. However, in the spirit of openness reflected in this CP, the City encourages agencies to submit records of such meetings and communications to the Contact Address on page 6 as often as possible during the licensing. COMMUNICATION WITH COMMISSION STAFF The Commission recently revised its ex-parte rules (88 FERC para. 61,225) and determined that the rule prohibiting off-the-record communications does not apply to interactions during the ALP. This is because all actions under ALP occur before a license application is filed, prior to the Noticed “licensing procedure” at the Commission. However, in this CP’s spirit of open interaction, oral communications by any participant with FERC staff should be summarized in a written memorandum prepared by a Participant agreed upon among those involved in the communication, and distributed to the Project Participant list for review. ORAL COMMUNICATIONS AND E-MAILS Oral communications (i.e. telephone conversations) between the City and any Participant will be documented in writing (see “Contact Logs”, below) if communications regard substantive aspects of the project licensing. Similarly, e-mails between the City and any Participant on substantive Project issues will also be documented. All written communications distributed by parties to the CP shall enclose or attach a distribution list for that communication that identifies all recipients of that communication. The cc list on an e-mail message can serve as the distribution list. Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 9 DISPUTE RESOLUTION Dispute prevention is preferable to dispute resolution. However, when disputes arise, it is intended that efforts to resolve a dispute focus on alternative dispute resolution methods. These may include the use of a facilitator, as described in the following: Compromise and Good Faith Efforts In the interests of reaching agreement, Participants are expected to make compromises in some areas. This means that Participants will make good faith effort to address the concerns of others so that most Participants can agree or live with the interim outcomes and do not object to the terms and conditions. It is recognized that each Participant may not find the resulting decision or settlement to be optimal in relation to their preferred outcome, but that the overall outcome will be beneficial to their interests as well as those of the other Participants. Informal Efforts to Resolve Disputes If disputes cannot be resolved through good faith efforts, a mutually agreed upon facilitator may be assigned. The facilitator and stakeholders should make every reasonable effort to resolve disputes amongst Participants including: facilitator’s use of alternative dispute resolution techniques, e.g., offline mediation by the facilitator; determining whether additional study or analysis could be undertaken to provide new information necessary to resolve the dispute; referring a technical matter to a third party expert or for peer review; identifying potential trade-offs to satisfy one of the disputing Participants; and, forming a workgroup to focus specifically on the matter in question. Participants that are in substantive dispute will schedule a separate meeting/conference call, open to all interested parties, to discuss and resolve their differences. Unless the parties agree that it is unnecessary, a facilitator must be present at a meeting as an independent note taker. STATEMENTS to the MEDIA Communications by the participants to the media will generally not be maintained in the Public Reference File. No person or entity involved in the alternative licensing process is authorized to make a statement on behalf of any other person or entity to any media person or entity with regard to the process or any substantive issue affecting the relicensing application. When a representative for a participant speaks to the media about the Project process, s/he should preface comments with: “I speak only for _________ and not for any other participant in the Takatz Lake Hydroelectric Project licensing process.” DURATION OF COMMUNICATIONS PROTOCOL CONDITIONS Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 10 This CP shall become effective upon the Commission’s approval of the City’s request to use the Alternative Licensing Process. Until then, the City and the participants shall act in good faith to recognize the likely future acceptance of this Protocol and its obligations. This Protocol will remain in effect until the Commission notifies the City the Preliminary Draft Environmental Review Document and Final License application are accepted for filing with the Commission or until termination of the ALP. Participants may elect by consensus, including unanimous consent of the Resource Parties, to extend the duration of this Protocol until license order issuance. RESERVATION of RIGHTS This Protocol is made (and filed with the Commission), and the collaborative process is undertaken, without prejudice as to any rights or interests of any participant and with a full reservation of rights by and on behalf of any and al l participants. No participant shall be deemed to have waived any legal right or evi dentiary claim or privi lege by participation, statement or act in this process by the participant or its representatives. Nothing in this Protocol shall be construed to limit any governmental agency from complying with its obligations under applicable laws or from considering public comments received in any environmental review or other regulatory process. This process shall not be interpreted to in any manner predispose or predetermine the outcome of any permit or environmental review process. CONTACT LOGS Contact log sheets will be utilized to document substantive oral communications among the Participants, the City or the Commission. Contact log sheets will include: individual(s) involved; title(s); date of communication; subject of communication; issues discussed; and action(s) to be taken. REVISIONS of the CP Upon written approval by the City and the signatories, this CP may be revised as deemed appropriate throughout the licensing period. No changes will be made to the CP without notification of all Participants. All proposed procedural changes will be distributed in writing to all Participants for review and comment. If comments represent a consensus of opinion on the proposed change(s), the Protocol will be modified, and the revised version distributed to the Participants list. In case of a dispute over proposed changes, the City will convene a meeting or teleconference among affected participants. SEMI-ANNUAL PROGRESS REPORTS The City will file with the Commission every six (6) months, a progress report that will summarize the Project status at the end of the previous 6-month reporting period. Each report will include the following for the forgoing 6-month period: • An updated log of oral and written communications; Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 11 • Descriptions of all major action taken on the project; • Copies of all comment letters and other written correspondence, including those with the Commission staff; • Copies of all meeting summaries and teleconferences call records, including those with Commission staff; • Schedule for the next 6-month licensing period, including action items; • Other information pertinent to the licensing. Each 6-month progress report will be placed in the Project Public Reference Files and on the Licensing Website. Each Participant will receive a copy of the cover letter submitting the progress report to the Commission along with a log of all communications filed for that period. Any Participant may request a copy of any item on the log from the City. COMMUNICATIONS PROTOCOL APPROVAL TAKATZ LAKE HYDROELECTRIC PROJECT FERC No. 13234-000 I have read and agree to follow this Communications Protocol proposed by the City and Borough of Sitka Electric Department to guide communications and information exchange between the Participants in the ALP for the Project. SIGNATURE AGENCY/ORGANIZATION DATE SIGNATURE PRINTED AGENCY/ORGANIZATION PRINTED ________________ ______________________ I accept the conditions of this communication protocol I do not accept the conditions of this communication protocol Reasons, if any: Communications Protocol Takatz Lake Hydro Project February, 2009 FERC No.13234 13 Written comments must be sent to the FERC address below. To file in writing to the FERC you must send an original and eight (8) copies of your comments to the following address: The Secretary Federal Energy Regulatory Commission 888 First Street Washington, D.C. 20426 We would appreciate your also sending your approval to: City and Borough of Sitka Electric Department Attn: Christopher Brewton, Utility Director 105 Jarvis St. Sitka, AK, 99835 chrisb@cityofsitka.com cc: deano@cityofsitka.com You may also file your comments via email using FERC’s “efiling” facility. To efile comments, log on to “ferc.gov” and follow the links to “efiling”. If you have questions on the efiling process, please contact Anji Russell, Electric Department administrative assistant, at 907-747-1882, or via email at: anjulie@cityofsitka.com. FERC SEMI-ANNUAL REPORT TAKATZ LAKE HYDROELECTRIC PROJECT PROJECT No. 13234-001 Reference Document: Grant Application, Tab 3: page 7 of 19 4th 6-month Progress Report Takatz Lake Hydroelectric Project Sitka Electric Dept., August, 2010 FERC No. 13234 1 FOURTH SIX-MONTH PROGRESS REPORT For the Period March, 2010 through August, 2010 TAKATZ LAKE HYDROELECTRIC PROJECT FERC No. 13234-000 City and Borough of Sitka Electric Department August, 2010 This report documents licensing activities for the Takatz Lake Hydroelectric Project (“Project”) during the Period March, 2010 through August, 2010. Biannual progress reports are required by Federal Energy Regulatory Commission (FERC) letter issuing a Preliminary Permit (“Permit”) for the Project, dated September 19, 2008. PROJECT BACKGROUND and CONTACT INFORMATION The Project would be an approximately 27 megawatt (MW) installation located on the east shore of Baranof Island, near Sitka, Alaska. Details of the proposal are in the Permit Application, filed with the Commission on June 3, 2008. The exact name, business address and contact numbers of the person authorized to act as agent for the Licensee is: City & Borough of Sitka, Electric Department Attn: Christopher Brewton, Utility Director 105 Jarvis Street Sitka, Alaska 99835 Phone: 907-747-1870 Fax: 907-747-3208 PROGRESS DURING THE FOURTH REPORTING PERIOD Progress during this reporting period is generally associated with meeting Commission requirements for project Scoping, development of study plans, and establishment of logistical requirements to begin field studies. The following sections will document progress by resource area. 4th 6-month Progress Report Takatz Lake Hydroelectric Project Sitka Electric Dept., August, 2010 FERC No. 13234 2 • Scoping Document #2 (SD2) SD2 was distributed to all parties on the mailing list on June 16, 2010. The deadline for filing comments was July 17, 2010 and comments were received from ten (10) respondents. • Stream Gaging The City & Borough of Sitka (CBS) signed a three year Joint Funding Agreement #10W0AK212740300 with the U.S. Geological Survey on March 17, 2010 for the establishment and operation of two (2) streamflow gaging stations at Takatz Lake. Stream gage sites are numbered 1509900 and 15100000. The second stream gage was commissioned on April 9, 2010. • Additional Permits The U.S. Forest Service (USFS) issued Special Use Permit # SIT538 on June 18, 2010 to conduct field studies to complete feasibility studies for the Takatz Lake Hydroelectric project with a permit expiration date of December 31, 2011. • Site Logistics Prior to beginning field work, site accommodations were established to ensure safe, adequate facilities for the field teams, including shelter, heating and cooking facilities, and bear protection. A boat was transported via helicopter to Takatz Lake to allow required aquatic and wildlife surveys. • LIDAR and Other Mapping Surveys On August 10, 2010 a contract was issued for additional LiDAR mapping of the Takatz Lake basin and the proposed Alternative Overland Transmission Segment. On August 12, 2010 a contract was awarded for High Resolution Satellite Imagery to be completed for the proposed project area, including the entire transmission corridor. • Resource Studies o Wildlife Resources Study Plan The draft Wildlife Study Plan was distributed to project stakeholders on March 24, 2010. Comments were received on April 17, 2010 from the Alaska Department of Fish and Game (ADF&G) and incorporated into the final Wildlife Study Plan which was distributed on May 25, 2010. 4th 6-month Progress Report Takatz Lake Hydroelectric Project Sitka Electric Dept., August, 2010 FERC No. 13234 3 o Wildlife Research Proposal – Mountain Goat Monitoring Study On April 2, 2010, CBS Electric Department staff met with ADF&G, USFS, and Sitka Tribe of Alaska (STA) representatives to discuss an ADF&G proposal to jointly fund a three-year mountain goat study. The CBS is completing work for the expansion of the Blue Lake Hydroelectric Project (FERC No. 2230) and the proposed inundation area from this project may have direct impacts on mountain goat movements with indirect (cumulative) impacts to the proposed Takatz Lake Hydroelectric Project. The study was approved and CBS provided funding to begin the study effective August 2010. o Aquatic Resources Study Plan The draft Aquatic Resources Study Plan was distributed to stakeholders on March 24, 2010. Substantive comments were received from ADF&G on April, 29, 2010. On May 13, 2010 a meeting was held at the National Marine Fisheries Service (NMFS) conference room in Juneau to review the draft plan and develop plans for the FY 2010 and FY2011 field seasons. Representatives from NMFS, ADF&G, USFS, CBS staff & consultants participated in the meeting. o Cultural Resources Study Plan The draft Cultural Resources Study Plan was distributed to the participants on the Restricted Service List on June 17, 2010 with comment period ending July 17, 2010. With the exception of FERC submitted comments, no additional comments were received. The final Cultural Resources Study Plan was distributed to the participants on August 18, 2010. o Botanical Resources Study Plan The draft Botanical Resources Study Plan was distributed to the stakeholders on August 16, 2010 with comment period ending September 16, 2010. • Engineering Studies o Overland Alternative Segment On July 1, 2010 the CBS issued a contract with an engineering design firm to evaluate the viability of the proposed Overland Alternative Segment transmission line that would run from the Takatz Powerhouse location to the head of Baranof River valley. On July 15, 2010 the contract engineers along with CBS Electric Department staff completed site reconnaissance via helicopter of the proposed line routing, including videotaping the route and conducting on the ground base line surveys. 4th 6-month Progress Report Takatz Lake Hydroelectric Project Sitka Electric Dept., August, 2010 FERC No. 13234 4 o HVDC Intertie On August 2, 2010 the CBS issued a contract to update the High Voltage Direct Current (HVDC) Intertie Study that was completed in January 2000. This information, in part, will be utilized in the economic viability study portion of the project. ITEMS to be COMPLETED DURING NEXT 6-MONTH REPORTING PERIOD • Study Plans The final Aquatic Resources Plan and draft Scenery Resources Plan will be issued this period. • Engineering Studies The HVDC Intertie Study and Overland Alternative Segment evaluation will be completed during this period. • Field Surveys Wildlife, aquatic, and cultural field work will continue until inclement weather prevents safe access to the project site. Tagging of goats relative to the mountain goat monitoring plan will begin this period with the planned capture and tagging of 12 goats in the Blue Lake watershed. • LIDAR and Other Mapping Surveys Depending on weather, LiDAR data acquisition flights and satellite mapping should be completed by the end of September 2010. Data is needed to complete preliminary line design for the project transmission corridor, reservoir analysis, and vegetation mapping. • Miscellaneous In accordance with the FERC letter of June 24, 2010, the CBS and USFS are scheduled to meet to discuss the potential project impacts relative to the Inventoried Roadless Areas and Land Use Designations issues in the 2008 Tongass National Forest Land and Resource Management Plan. A report to FERC addressing these concerns is due no later than October 22, 2010. Christopher Brewton, Utility Director City and Borough of Sitka Electric Department Cc: Takatz Project Stakeholder list. Joe Adamson, FERC FERC APPLICATION FOR PRELIMINARY PERMIT TAKATZ LAKE HYDROELECTRIC PROJECT PROJECT No. 13234-001 Reference Document: Grant Application, Tab 3: page 10 of 19 BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION APPLICATION FOR PRELIMINARY PERMIT Takatz Lake Project - Alaska SUBMITTED BY: City and Borough of Sitka Electric Department 105 Jarvis Street Sitka, Alaska 99835 June, 2008 Initial Statement Before The Federal Energy Regulatory Commission: Application for Preliminary Permit The City and Borough of Sitka (“City”, “Applicant”), applies to the Federal Energy Regulatory Commission (FERC) for a Preliminary Permit for the proposed Takatz Lake Hydroelectric Project (“Project”), as described in the attached Exhibits. The Project would connect with the existing transmission facilities of the City’s Green Lake (FERC P-2818) and Blue Lake (FERC P-2230) hydroelectric projects to increase the City’s renewable energy generation capacity and to protect Sitka ratepayers from energy cost increases due to diesel generation. This application is made in order that the Applicant may secure priority of application for a license for the Project under Part 1 of the Federal Power Act while obtaining the data and performing the acts required to determine the feasibility of the Project and to support an application for a license. The proposed location of the Project would be: Takatz Lake and the proposed Powerhouse are located in: Sections 35, 36 of Township 54S, Range 66E of the Copper River Meridian, and Sections 1, 2, 3, 4, 10 of Township 55S, Range 66E of the Copper River Meridian The approximate powerhouse location is: longitude 134 degrees 52.07’ west; latitude 57 degrees 08.21’ north. State: Alaska County: City and Borough of Sitka, Alaska Nearby Town: Sitka, Alaska Stream or Other Body of Water: Takatz Lake and its outlet Takatz Creek The exact name, business address, and telephone number of the applicant is: City and Borough of Sitka 100 Lincoln Street Sitka, Alaska 99835 907-747-3294. Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 2 The exact name, business address and phone number of each person authorized to act as agent for the Applicant in this application are: James E. Dinley, Municipal Administrator 100 Lincoln Street Sitka, Alaska 99835 Phone 907-747-1808 E-mail: jimdinley@cityofsitka.com Charles Y. Walls, Utility Director, Electric Department City and Borough of Sitka 105 Jarvis St. Sitka, Alaska 99835 Phone: 907- 747- 4000 Electric Department 907-747-1870 Charles Walls Fax: 907-747-3208 Electric Department E-mail: charlie@cityofsitka.com The City and Borough of Sitka is organized and existing in the State of Alaska. The City and Borough of Sitka is claiming preference under Section 7 (a) of the Federal Power Act. The proposed term of the requested Preliminary Permit is 36 months. There are no existing dams, or other project facilities. The following Exhibits are filed herewith and are hereby made a part of this application: EXHIBIT 1 DESCRIPTION OF THE PROJECT EXHIBIT 2 DESCRIPTION OF STUDIES TO DETERMINE THE FEASIBILITY OF THE PROJECT EXHIBIT 3 ESTIMATED COSTS AND FINANCING EXHIBIT 4 PROJECT MAPS Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 3 EXHIBIT 1, DESCRIPTION OF THE PROJECT PROJECT FEATURES The project description and much basic data presented herein was obtained from a report by the U.S. Department of Interior, Alaska Power Administration (APA), entitled Takatz Creek Project – Alaska dated January, 1968. The City cites the proposed project design and other supporting data from that report in this application. In the following description, elevations are in feet above mean low sea level and are denoted “El”. General. The proposed project would be located about 21 airline miles east of the City of Sitka, Alaska on the eastern shore of Baranof Island. Development of hydroelectric power at the site would include construction of a lake tap, concrete dam, power intake, unlined tunnel, power penstock, power plant, tailrace, and transmission line segments (See Maps and written description below). Reservoir/Dam. Takatz Lake is located approximately 4,000 feet upstream of the mouth of Takatz Creek which flows into Chatham Strait by way of Takatz Bay on the eastern shore of Baranof Island. Normal water surface of the lake is at approximately El 840. Construction of a concrete arch dam approximately 200 feet high at the existing outlet of the lake would raise the lake level to El 1040. The reservoir would contain an active storage of volume of approximately 82,400 acre-feet. Lake Tap/Power Conduit. Water would be withdrawn through a lake tap into an approximately 2,800 foot-long, 6.5 foot by 7 foot modified horseshoe tunnel. The tunnel’s downstream portal would connect to a 72-inch diameter, 1000 foot-long steel penstock leading to the powerhouse. Powerhouse, Switchyard and Tailrace. A surface powerhouse approximately 10,000 square feet in area would be constructed at ground level near Takatz Bay. The powerhouse would house two 18,600 hp Francis turbines, driving two 13.8 megawatt (MW) generators. A switch yard would be located near the Takatz Bay powerhouse and at the intersection with the existing transmission system near the existing Medvejie Fish Hatchery on Silver Bay. The powerhouse tailrace would provide an average of about 166 cubic feet per second (cfs) discharge into tidewater. Access Roads. Access for construction and long-term operation and maintenance of the Project would be via seaplane, helicopter and boat. An approximately 3-mile long gravel surfaced access and maintenance road would lead to Takatz Lake from a dock to be constructed on Takatz Bay. Transmission Facilities: Power generated by the Project would be transmitted by a new 26- mile long 138 kilovolt (kV) transmission line energized initially at 69 kV. The transmission line Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 4 could consist of a combination of overhead, underground and submarine segments. Exact transmission type and routing will be determined based on further field investigations and feasibility studies. The line would interconnect with the existing 69 kV transmission system which currently connects the Blue Lake and Green Lake Projects to the City of Sitka Electric Department service area. The 138 kV transmission line insulation level would provide capacity for future power supply projects, including potential geothermal resources at Baranof Warm Springs and as many as five other potential hydroelectric project sites near Takatz Lake on the east side of Baranof Island. These other sites may be developed in the future as needs for additional renewable energy sources in Sitka increase. INSTALLED CAPACITY and ENERGY PRODUCTION Installed Capacity. Total installed capacity would be 27.7 MW, depending on final design. Annual Energy Production. The Takatz Lake project configuration evaluated in the 1968 APA feasibility study produced 97,100,000 kilowatt/hours (kWh) of firm annual energy and 9,800,000 kWh of non-firm energy for a total average capability of 106,900,000 kWh generation each year. The reservoir filled 14 years of the 19 year study, with spills occurring in 9 years. LANDS OF THE U.S. GOVERNMENT and of the CITY AND BOROUGH OF SITKA The project would be located within the Tongass National Forest on lands managed by the US Department of Agriculture Forest Service (USFS). The City and Borough of Sitka owns the shoreline lands of Takatz Lake and Takatz Bay. The transmission line would traverse Baranof Island on Federal lands managed by the USFS. The project would not use any Federal facilities. The Sitka Tribe of Alaska may be interested in the project. Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 5 EXHIBIT 2, DESCRIPTION OF STUDIES TO DETERMINE THE FEASIBILITY OF THE PROJECT The Applicant proposes to conduct several studies to determine Project feasibility and environmental effects. The exact extent and nature of these studies will be determined during early stage consultation with Alaska state and Federal resource agencies, and results of more detailed engineering calculations. ECONOMIC and ENGINEERING FEASIBILITY EVALUATION Hydrology Stream flow records for 15 complete water years are available at a point on Takatz Creek downstream of the dam site with a drainage area of 17.5 square miles. The stream gage would be re-established to continue gathering stream flow data. Generation A generation study will be performed to determine the exact size and type of turbine/generator, switchgear, transmissions facilities and other electrical equipment. Engineering Feasibility Engineering feasibility studies will be performed in association with field surveys and topographic mapping to determine the constructability of the various project features in relation to surface and subsurface conditions, vegetation and topography. ENVIRONMENTAL and GEOTECHNICAL STUDIES Environmental Studies The exact nature and scale of environmental studies will be determined during agency consultation and study planning. Generally, however, environmental studies are required to meet information needs in the following areas: • Aquatic Resources • Terrestrial Resources • Water Use and Quality • Geology and Soils • Socioeconomics • Cultural Resources • Land Use and Recreation • Aesthetics Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 6 Geotechnical, Seismic and other Subsurface Investigations The 1968 APA report documented the geology at the site and concluded that conditions were adequate for construction of a concrete arch dam. The City will evaluate the need for additional geotechnical studies. NEW ROADS for CONDUCTING STUDIES No new roads are planned for conducting general environmental and engineering studies. Access by road may be necessary if additional geotechnical work is done. WORK PLAN FOR NEW DAM CONSTRUCTION Work for the proposed dam would occur over a three to four year period, including mobilization and demobilization. Work would be concentrated during the spring, summer and fall to minimize problems associated with winter weather and potentially deep snowfall. DISTURBANCES FROM CONDUCTING STUDIES Disturbances from conducting studies would be minimal. The only expected disturbance could arise if extensive additional geotechnical work were required, but previous studies in this area should preclude such a need. Any onsite work will be coordinated with the USFS, including obtaining a USFS Special Use Permit, if applicable. SCHEDULE FOR STUDY COMPLETION Engineering and environmental studies will be completed as necessary prior to expiration of the Preliminary Permit. Some environmental studies may continue through the post-application period and even during the construction period to satisfy requirements for environmental monitoring. EXHIBIT 3, ESTIMATED COSTS AND FINANCING ENGINEERING AND ENVIRONMENTAL STUDIES AND CONSULTATION COSTS Engineering and Economic Evaluation Costs. Based on review of existing information and data, and on our experience with other such evaluations in Alaska, we expect total Engineering and Economics studies to cost between $6,000,000 and $10,000,000 from inception through the final design stage. Environmental Consultation and Studies Costs. The Applicant, based on prior experience with remote project studies and construction, expects environmental consultation and studies to cost between $1,000,000 to $1,500,000, or higher, depending upon study requests from state and federal agencies and the FERC. Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 7 FINANCING Financing is expected to come from a mix of sources, including municipal investments, State of Alaska energy development monies, federal funds, and bank financing. The exact mix of financing will be determined as the licensing proceeds. MARKET FOR POWER GENERATED Proposed Power Purchaser(s). Power purchasers would initially be electric utility customers of the City and Borough of Sitka. Over time, with increasing costs of petroleum-based fuel, demand for hydroelectric energy is expected to increase throughout Southeast Alaska. If electrical intertie facilities within the Southeast Alaska region become available, the Takatz Lake Project could help to meet renewable energy needs throughout the region. USE OF ENERGY BY THE APPLICANT The Applicant operates the power generation, transmission and distribution systems to provide electrical service to the community of Sitka, approximately 5000 consumers (meters), in the City of Borough of Sitka. Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 8 EXHIBIT 4. PROJECT MAPS EXHIBIT 4, Map 1 VICINITY MAP Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 9 EXHIBIT 4, Map 2. PROJECT FEATURES AND BOUNDARY Preliminary Permit Application Takatz Lake Project - Alaska City and Borough of Sitka Electric Dept. June, 2008 10 FERC APPROVAL OF ALTERNATIVE LICENSING PROCESS (ALP) TAKATZ LAKE HYDROELECTRIC PROJECT PROJECT No. 13234-001 FEDERAL ENERGY REGULATORY COMMISSION WASHINGTON D.C. 20426 Aoril 28. 2009 OFFICE OF ENERGY PROJECTS Project No. 13234-001 - Alaska Takatz Lake Hydroelectric Project City and Borough of Sitka Christopher Brewton, Utility Manager City and Borough of Sitka 105 Jarvis Street Sitka, AK 99835 Reference: Request for Alternative Licensing Process Dear Mr. Brewton: On March 24,2009, the Federal Energy Regulatory Commission (Commission) issued a notice of the City and Borough of Sitka's (Cify) request to use the alternative licensing process for preparing and filing a license application for its Takatz Lake Hydroelectric Project. In support of the use of the alternative licensing process, the City demonstrated that it has made an effort to contact all resource agencies, Indian tribes, citizens groups, and others affected by the project and that a consensus exists that the use of the alternative licensing process is appropriate in this case. The City included a Communications Protocol that is supported by the interested entities. The Commission's notice requested any additional comments on the City's proposal to use the alternative licensing process. We received no comment letters in response to the notice. In light of the support shown for using the alternative licensing process, I believe that the use of the alternative licensing process would be appropriate in this case because it r,vould foster improved communications, participation, and cooperation among the participants, and ultimately simplify and expedite the licensing process. Therefore, I am approving the City's request to follow the alternative licensing process in accordance r,vith the Commission's Regulations for Licensing Hydroelectric Projectsr and the Communications Protocol filed with the Cornmission on March 20,2008, with the followine rnodifications: '81 FERC fl 61,103 (1997). 2 t. pn page 4, the last sentence of the second paragraph shall read: The commission will notice the scoping meetingand site visit, and provide a court reporter. All comments (verbal and written) will become part of the Commission's public record for the project." 2. On page 4, Table l, the last row stating when the Commission is expected to issue a new license is deleted. If you have any questions or comments, please contact Joseph Adamson, the Commission's licensing coordinator assigned to this project, ui 12021502-g0g5or ioseph. adamson@ferc. gov. cc: Sincerely, ill,,,il iltfl" Ann F. Miles, Director Division of Hydropower Licensing AdministratorJames E. Dinley, Municipal City and Borough of Sitka 100 Lincoln Street Sitka, AK 99835 Mailing List Public Files FERC APPROVAL OF PRELIMINARY PERMIT TAKATZ LAKE HYDROELECTRIC PROJECT PROJECT No. 13234-001 Reference Document: Grant Application, Tab 3: page 12 of 19 124 FERC ¶ 62,212 UNITED STATES OF AMERICA FEDERAL ENERGY REGULATORY COMMISSION City and Borough of Sitka Project No. 13234-000 ORDER ISSUING PRELIMINARY PERMIT (Issued September 19, 2008) On June 3, 2008, The City and Borough of Sitka filed an application, pursuant to section 4(f) of the Federal Power Act (FPA),1 to study the feasibility of the Takatz Lake Project. The project would be located on Takatz Lake in the Borough of Sitka, Alaska and would occupy federal lands within the Tongass National Forest. The proposed project would consist of: (1) a 200 foot high concrete arch dam; (2) a reservoir with an elevation of 1,040 feet mean sea level and a capacity of 82,400 acre-feet; (3) a 2,800 foot long, unlined power tunnel fed by a lake tap and draining into a 1,000 f oot long steel lined penstock; (4) a powerhouse containing two turbine-generator units with a total installed capacity of 27.7 MW; (5) a 26 mile long, 69 kV transmission line and; (6) appurtenant facilities. The project is estimated to have an annual generation of 106.9 GWh. Background The Commission issued public notice of the application on June 10, 2008. The U. S. Department of Agriculture and the National Marine Fisheries Service filed motions to intervene to be parties in the proceeding 2 Tongass’ comments are general and are intended to assist the permittee by clarifying issues to be addressed during the term of the preliminary permit. Tongass National Forest also states that the permittee will need to obtain a Special Use Authorization from the Forest Service in order to occupy Forest Service lands during the preliminary permit phase. and the Tongass National Forest (Tongass) filed comments. 1 16 U.S.C. § 797(f) (2000). 2 Timely, unopposed motions to intervene are granted by operation of Rule 214 of the Commission’s Regulations. Id. § 385.214(a)(3) (2008). Project No. 13234-000 - 2 - Discussion The purpose of a preliminary permit is to maintain priority of application for a license during the term of the permit while the permittee conducts investigations and secures data necessary, after consultation with the appropriate resource agencies, to determine the feasibility of the proposed project and prepares an acceptable development application. The permit confers no authority on the permittee to undertake construction of the proposed project or any part thereof,3 or to occupy or use lands or other property of the United States or of any other entity or individual. If, during the course of the permittee’s investigation into the feasibility of the proposal, the permittee decides to prepare a development application, it must first prepare a Notice of Intent (NOI) and Pre-Application Document (PAD) pursuant to Sections 5.5 and 5.6 of the Commission’s Regulations. Pursuant to Part 5 of the Commission’s regulations, 18 C.F.R. Part 5, the permittee must use the Integrated Licensing Process unless the Commission grants a request to use an alternative process (Alternative or Traditional Licensing Process). Pursuant to Section 5.3, such a request must accompany the NOI and PAD and set forth specific information justifying the request.4 Should the permittee file a development application, notice of the application will be published, and interested persons and agencies will have an opportunity to intervene and to present their views concerning the project and the effects of its construction and operation. A preliminary permit is not transferable. The named permittee is the only party entitled to the priority of application for license afforded by this preliminary permit. In order to invoke permit-based priority in any subsequent licensing competition, the named permittee must file an application for license as the sole applicant, thereby evidencing its intent to be the sole licensee and to hold all proprietary rights necessary to construct, operate, and maintain the proposed project. Should any other parties intend to hold during the term of any license issued any of these proprietary rights necessary for project purposes, they must be included as joint applicants in any application for license filed. In such an instance, where parties other than the permittee are added as joint applicants for license, the joint application will not be eligible for any permit-based priority. See City of Fayetteville, 16 FERC ¶ 61,209 (1981). 3 Issuance of this preliminary permit is thus not a major federal action significantly affecting the quality of the human environment. 4See Commission Order 2002, issued July 23, 2003. Project No. 13234-000 - 3 - The Director orders: (A) A preliminary permit is issued for this project to The City and Borough of Sitka, for a period effective the first day of the month in which this permit is issued, and ending either 36 months from the effective date or on the date that a development application submitted by the permittee has been accepted for filing, whichever occurs first. (B) This preliminary permit is subject to the terms and conditions of Part I of the Federal Power Act and related regulations. The permit is also subject to Articles 1 through 4, set forth in the attached standard form P-1. (C) This order is issued under authority delegated to the Director and constitutes final agency action. Requests for rehearing by the Commission may be filed within 30 days from the date of issuance of this order, pursuant to 18 C.F.R. 385.713. William Guey-Lee Chief, Engineering and Jurisdiction Branch Division of Hydropower Administration and Compliance Form P-1 (Revised February 2007) FEDERAL ENERGY REGULATORY COMMISSION TERMS AND CONDITIONS OF PRELIMINARY PERMIT Article 1. The purpose of the permit is to maintain priority of application for a license during the term of the permit while the permittee conducts investigations and secures data necessary to determine the feasibility of the proposed project and, if said project is found to be feasible, prepares an acceptable application for license. In the course of whatever field studies the permittee undertakes, the permittee shall at all time exercise appropriate measures to prevent irreparable damage to the environment of the proposed project. All test sites shall be restored as closely as possible to their original condition and to the satisfaction of the Commission's authorized representative or, where federal lands are affected, to the satisfaction of the agency administering such lands. Article 2. The permit is not transferable and may, after notice and opportunity for hearing, be canceled by order of the Commission upon failure of the permittee to prosecute diligently the activities for which a permit is issued, or for any other good cause shown. Article 3. The priority granted under the permit shall be lost if the permit is canceled pursuant to Article 2 of this permit, or if the permittee fails, on or before the expiration date of the permit, to file with the Commission an application for license for the proposed project in conformity with the Commission's rules and regulations then in effect. Article 4. At the close of each six-month period from the effective date of this permit, the permittee shall file four copies of a progress report with the Secretary, Federal Energy Regulatory Commission, 888 First Street, N.E., Washington, D.C. 20426; and shall serve a copy on the interveners in this proceeding. The report shall describe, for that report period, the nature and timing of what the permittee has done under the pre-filing requirements of 18 CFR §§ 4.38 and 5 and other applicable regulations; and, where studies require access to and use of land not owned by the permittee, the status of the permittee's efforts to obtain permission therefor. CITY & BOROUGH OF SITKA 2008 ELECTRIC SYSTEM LOAD FORCAST Reference Document: Grant Application, Tab 3: page 8 of 19 City and Borough of Sitka 2008 Electric System Load Forecast FINAL REPORT September 12, 2008 Prepared for City and Borough of Sitka Municipal Electric Department 105 Jarvis Street Sitka, Alaska 99835 by Page i City and Borough of Sitka 2008 Electric System Load Forecast Report Page Introduction and Overview..................................................................................................1 Customer Account Forecast.................................................................................................3 Energy Consumption per Customer.....................................................................................7 Large Customer Loads.........................................................................................................8 Total Energy Sales.............................................................................................................10 Total Energy Requirements...............................................................................................11 Peak Demand.....................................................................................................................12 Interruptible Energy Sales..................................................................................................13 Appendix TABLES 1. Forecasted Population Used in Load Forecast........................................................5 2. Forecasted Total Number of Customer Accounts (Medium Growth Scenario) .....6 3. Annual Energy Consumption per Customer Account.............................................8 4. Forecasted Total Retail Energy Sales ...................................................................10 5. Forecasted Total Energy Requirements................................................................11 6. Forecasted Peak Demand......................................................................................13 7. Historical Number of Customer Accounts and Usage Per Customer ......Appendix 8. Historical Energy Sales, Total Requirements and Losses.........................Appendix 8A. Historical Peak Loads and Loadfactor......................................................Appendix 9. Forecasted Number of Customer Accounts and Usage per Customer......Appendix 10. Forecasted Energy Sales, Total Requirements, Losses and Peak .............Appendix 11. Assumed Residential Electric Heat Customers and Net Use per Cust......Appendix 12. Estimated Interruptible Energy Sales........................................................Appendix 12A. Assumed New Interruptible Loads............................................................Appendix 13. Estimated Electric Vehicle Loads.............................................................Appendix 14. Large Customer Loads..............................................................................Appendix FIGURES 1. Historical Energy Sales by Customer Class and Total Generation.........................3 2. Historical and Forecasted Population......................................................................5 5. Historical and Projected Total Energy Requirements (1973-2028)......................12 Page 1 City and Borough of Sitka 2008 Electric System Load Forecast Report Introduction and Overview A 20-year annual forecast of electric customers, energy requirements and system peak demand has been developed for the City and Borough of Sitka (City) Electric Department. Although the 2008 forecast uses a similar approach to that used for the City’s 2005 load forecast, a significant adjustment has been made in the new forecast to acknowledge the expected conversion to electric space heat in the community as a result of very high fuel oil prices. In addition, it is expected that in a few years there could be a number of electric vehicles operating in Sitka. As a result, an alternative high load growth case was developed that includes the energy requirements for electric vehicles. The number of customers and total energy sales have been forecasted for each of the City’s customer classifications on an annual basis for the period 2009 through 2029.1 Four alternative growth scenarios: medium, high, low, and high electric vehicle were developed. A forecast of the energy requirements for the largest power users has been developed based on input from the City. In addition, a forecast of interruptible energy sales has also been developed that is based on the projected availability of surplus hydroelectric generation. It is important to note that the forecast has not been adjusted to reflect the potential increase in the cost of electricity that may be needed if power requirements exceed the hydroelectric energy generation capability of the City’s system and more diesel generation is needed. With more diesel generation on a regular basis, the cost of electricity to consumers would potentially be higher than it presently is and demand could drop somewhat. The Electric Department has indicated that it intends to use the forecast to determine when additional hydroelectric capability should be developed. As such, the forecast provides a projection of total power requirements that could be expected if electricity prices remain in the same range as they are today. Since the City’s last load forecast in 2005, total annual energy sales and energy requirements have increased every year. The total number of electric accounts has increased from 5,034 in 2005 to 5,180 in 2008, representing an average annual increase of 1.0%. Annual energy consumption per customer has increased since 2005 for residential and commercial customer classifications. It is believed that the increase in electricity consumption per customer is due to an increase in the use of electric space heat. In the year ended June 30, 2008, the City’s total energy requirements were 112,772 MWh, an increase of 1.3% over the requirements in 2007. Following the closure of the Alaska Pulp 1 All references to annual totals are for years ending June 30, based on the City’s fiscal year. City and Borough of Sitka 2008 Electric System Load Forecast Page 2 Company (APC) mill in 1993, total energy requirements decreased somewhat and remained relatively constant between 1994 and 2001 at which time they began to increase. Annual peak demand also dropped after 1993 and remained relatively constant between 1998 and 2003 at approximately 17.5 MW. Beginning in 2004 the peak demand began to increase annually reaching a record high 22.24 MW in 20082. Prior to 2008, the all time annual system peak demand was 22.0 MW in 1993 attributed, in part, to the partial requirements demand of APC on the City system. The 2008 forecast has been developed using an energy demand model that independently projects customers and energy consumption for each of the City’s electric customer classifications for each year of a 20-year forecast period, 2009 through 2028. Although relationships between the number of customers and several variables were considered, the most significant correlations were established with population and the previous year’s number of customers. Similarly, the number of commercial and public authority customers appears to be closely related to the number of residential customers when compared to the other variables evaluated. Energy use per residential customer has increased steadily since 2003, due most likely to an increase in electric space heat as fuel oil prices have continued to increase. Between 1993 and 2003, electric energy use per customer dropped each year. An increase in the price of electricity to consumers in 1993 is considered to have contributed to a price-induced reduction in electricity consumption. Prior to 1993, residential energy consumption per customer increased steadily over a 20-year period. Average annual energy consumption per Boat customer account has continued to increase year after year as more shore power is used by moored boats for heat and other purposes. Average energy consumption per commercial account has remained relatively constant in recent years but increased noticeably in 2008. Public Authority customers have also shown an increase in consumption in the past two years. Prior to the recent increase, the average energy consumption per Public Authority account remained relatively constant. Total energy sales by customer class for the years 1973 through 2008 are shown in Figure 1. As can be seen in Figure 1, a significant amount of energy was sold to APC between 1982 and 1990. The number of customer accounts and energy consumption per customer for the period 1973 through 2008 are shown in Table 7. Historical annual energy sales by customer classification, total system energy requirements and annual energy losses for the same period are shown in Table 8. Table 8A shows peak demand, average annual demand and annual loadfactors for the City’s electric system for the same period. All three of these tables are located following the text of this report. 2 The peak demand in 2008 occurred with an outdoor temperature of 6 degrees Fahrenheit. City and Borough of Sitka 2008 Electric System Load Forecast Page 3 Figure 1 City and Borough of Sitka Historical (1973-2008) Energy Sales by Customer Class and Total Generation 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 110,000 120,000 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 Fiscal Year Ending June 30Kilowatt-hours (000)Residential Commercial Boats Public Authority APC/SCIP Total Generation Customer Account Forecast The forecasted number of residential customers is based primarily on the relationship between population and the number of electric customers, with acknowledgement of recent trends in the number of electric customers served. Population projections for the City and Borough are periodically developed by the State of Alaska Department of Labor (DOL). DOL’s last detailed long-term projection was prepared in 2007 and the results were presented in the report, Alaska Population Projections: 2007-2030. This latest DOL forecast projects the total state population to increase at an average annual basis of 0.9% for the middle scenario. The low and high scenarios indicate average annual population growth of 0.4% and 1.5%, respectively. The 2007 DOL population projections indicate some minimal growth in the population of the City and Borough between 2007 and 2010 but show a gradual decrease in the City and Borough population over the ensuing 20 year period 2010-2030. In the 2007 DOL projection, the 2006 population was indicated to be 8,833 for the City and Borough. This value is somewhat lower than the reported population estimate of 8,989 provided in DOL’s report3 on actual population characteristics. Further the actual population in Sitka was indicated by DOL to have actually declined by 349 to 8,640 in 2007 as a result of the closure of the Sheldon Jackson College. 3 Characteristics Of Boroughs And Census Areas And Components Of Change By Region, 1970-2007, Alaska Department of Labor and Workforce Development, Research and Analysis Department, Demographics Unit.. City and Borough of Sitka 2008 Electric System Load Forecast Page 4 DOL’s population characteristics are noted as estimates4 based on a number of factors and it can’t be verified through other sources yet as to whether or not this reduction in Sitka population has actually occurred. In 1993, the population of Sitka was nearly 9,000. Following closure of the pulp mill, the population declined to approximately 8,700 in 1997 before stabilizing and beginning a slight increase. Between 1997 and 2006, the population increased at an average annual rate of approximately 0.4%. Over the 25 year period, 1981 to 2006, the City’s population increased by 1,006, representing a 12.6% overall increase and 0.48% average annual growth. For the purpose of the electric load forecast it has been necessary to develop a population projection to serve as the basis for the number of future electric consumers in Sitka. Based on the DOL forecast it has been assumed that the City and Borough population will increase slightly in the near-term but will then decrease gradually resulting in an average annual population change of -0.12% through 2030. This results in an overall population decrease of 211 by 2030 representing a total decrease of 2.3% over the estimated 2006 population. Alternative average annual population growth rates of -0.36% and 0.50% have been assumed for the low and high scenarios, respectively. The population projections used in the forecast are presented in Table 1 and Figure 2, below. Historical population from 1981 to 2007 is also shown in Figure 2. 4 The DOL estimated population numbers provide interim estimates of population between the federal census counts made every ten years. The next census will occur in 2010. City and Borough of Sitka 2008 Electric System Load Forecast Page 5 Table 1 Forecasted Population Used in Load Forecast City and Borough of Sitka Medium Low High 2006 (Estimated Actual) 8,989 8,989 8,989 2008 9,022 8,899 9,034 2010 9,088 8,722 9,124 2015 9,073 8,592 9,355 2020 8,988 8,463 9,591 2025 8,863 8,338 9,833 2030 8,778 8,213 10,081 Average Annual Growth Rates 2006 - 2010 0.37% -1.00% 0.50% 2010 - 1015 -0.04% -0.30% 0.50% 2015 - 2020 -0.19% -0.30% 0.50% 2020 - 2025 -0.28% -0.30% 0.50% 2025 - 2030 -0.19% -0.30% 0.50% 2008 - 2030 -0.12% -0.36% 0.50% Forecasted Population Figure 2 City and Borough of Sitka Historical and Forecasted Population and Average Annual Growth Rates in Population 5,000 6,000 7,000 8,000 9,000 10,000 11,000 1981 1985 1989 1993 1997 2001 2005 2009 2013 2017 2021 2025Borough PopulationMid Case Low Case High Case Historical Projected 0.48% Average 1981-2006 0.50% -0.12% -0.36% 0.0% Average Annual Growth1993-2006 City and Borough of Sitka 2008 Electric System Load Forecast Page 6 The number of residential accounts has been projected based on the calculated relationship between customers served, population and recent trends in the number of residential accounts served. A regression analysis of the historical trend in the number of residential accounts indicates that the change from year to year is highly dependent on the previous year’s number of accounts. This would mean that although the local population may change somewhat from year to year, the number of accounts served is more closely tied to the number of residences in Sitka. In other words, when the population decreases the number of persons per household drops slightly but the number of active residential electric accounts remains very similar. Long-term permanent trends in population due to major changes in the economy may show different results. The number of electric commercial accounts served by the City has historically been related to the number of residential accounts. Between 2005 and 2008, there were approximately 5.8 residential accounts per commercial account. The forecast of commercial, public authority and boats customer accounts has been developed as a function of residential customers. Forecasted number of customer accounts, by customer classification are shown in Table 9 for the medium, high and low growth scenarios. Since the number of residential customers is projected relative to forecasted population and recent trends in the number of customers served, there is a projected decrease in the number of customers served for the low growth scenario and a slight increase for the medium and high growth scenario. The projected number of customers for the medium scenario are summarized in Table 2. As can be seen in Table 2, the total number of customer accounts served by the City is projected to increase at an average annual rate of 0.6% per year. A more detailed presentation of the number of customer accounts is shown in Table 9. Table 2 Forecasted Total Number of Customer Accounts (Medium Growth Scenario) 1 Forecast Year Residential Commercial Boats Public Authority Total 2008 (Actual) 3,621 611 748 182 5,162 2010 3,669 629 776 202 5,276 2015 3,770 667 838 214 5,489 2020 3,845 699 890 220 5,654 2025 3,895 723 932 225 5,775 2029 3,921 739 960 227 5,847 Average Annual Growth Rates 2008-2010 0.6% 1.4% 1.8% 2.5% 1.0% 2010-2015 0.5% 1.1% 1.5% 0.9% 0.7% 2015-2020 0.3% 0.8% 1.1% 0.5% 0.5% 2020-2029 0.2% 0.6% 0.8% 0.3% 0.4% 2008-2029 0.4% 0.9% 1.2% 1.1% 0.6% Customer Classification 1 Excludes eight large commercial and four large public authority customers. City and Borough of Sitka 2008 Electric System Load Forecast Page 7 Energy Consumption per Customer Establishing a good relationship between energy consumption and variables such as weather conditions, per capita income, inflation and others, was not possible. Energy consumption is most likely affected by these variables, but based on the City’s experience in recent years, no consistent relationship can be determined. For purposes of the forecast, energy consumption per customer has been assumed to be based on an average of consumption in recent years with assumed explicit changes applied, primarily related to assumed increases in the amount of electric space heat. Following completion of the Green Lake hydroelectric project in the mid-1980’s and until the early 1990’s, new residential construction in Sitka often employed electric space heating. Some of this electric space heating was supplanted with fuel-oil based Monitor type stoves, which is reflected in the significant reduction in per customer residential electric energy consumption since 1993. With the current high price of fuel oil, the potential exists for a return to the use of electricity for space heating and a corresponding increase in overall electric energy use. The relatively high increase in energy consumption per residential customer the past two years would indicate that more electric space heat is being used in Sitka than was used prior to 2007. In all three load forecast scenarios, it has been assumed that a fairly significant number of residential customers will convert from oil to electric space heat. For some customers this conversion may entail replacement of the central heating system in the residence. In other cases it may be that portable electric heaters are used to supplement or replace space heating needs. At the present time, it is estimated that approximately one-third of the 3,620 residential customers in Sitka are currently using electric heat. For the medium load growth scenario, it is assumed that the saturation of residential electric heat customers will increase to about 50% over the next five years. For the high and low growth scenarios, the residential electric heat saturation is assumed to increase to 66% and 45%, respectively. Residential electric heat customers are assumed to require 1,700 kWh per month on average throughout the year compared to 700 kWh per month on average for non-electric heat customers. In addition to the medium, low and high load growth scenarios, a fourth forecast scenario has been developed to provide for electric loads related to electric vehicles. Automobile manufacturers have indicated that a greater emphasis will be placed on the development and marketing of electric vehicles. It is thought that with available hydroelectric power and a limited local road distances, Sitka may be a good community to employ electric vehicles as they become commercially available. For the electric vehicle scenario which is a modification of the high growth scenario, it is assumed that over an 18-year period, 75% of the passenger vehicles in Sitka will be electric. This transition is expected to occur gradually as existing vehicles wear out and are replaced. At the present time it is estimated that there are 4,860 passenger vehicles in Sitka. Electric vehicles are assumed to travel 4,380 miles per year at a rate of 5.0 miles per kWh. In addition, it is estimated that an electric vehicle will require 1,095 kWh per year for interior heating. City and Borough of Sitka 2008 Electric System Load Forecast Page 8 Base consumption amounts and assumed changes in consumption in the future are shown in Table 3. The energy consumption per customer for the commercial and public authority customer classes is adjusted net of the large customer loads discussed later in this report. Forecasted energy consumption per customer for each customer class through the forecast period is shown in Table 9. Details on electric space heat consumption are shown in Table 11 and assumptions related to electric vehicle loads are shown in Table 13. Table 3 Annual Energy Consumption per Customer Account and Assumed Future Changes in Consumption 1 Residential Commercial Boats Public Authority Annual kWh per Customer: Actual 2008 12,813 28,830 4,923 103,970 Assumed Average Annual Change: Medium Growth Scenario 2008-2010 3.1% 0.5% 0.5% 0.5% 2010-2015 1.1% 0.5% 0.5% 0.5% 2015-2020 0.1% 0.5% 0.5% 0.5% 2020-2029 0.1% 0.5% 0.5% 0.5% High Growth Scenario 2008-2010 3.9% 2.0% 1.0% 3.0% 2010-2015 2.9% 1.0% 1.0% 1.0% 2015-2020 0.1% 1.0% 1.0% 1.0% 2020-2029 0.1% 1.0% 1.0% 1.0% Low Growth Scenario 2008-2010 1.4% -1.5% -1.5% -1.5% 2010-2015 1.0% 0.0% 0.0% 0.0% 2015-2020 0.2% 0.0% 0.0% 0.0% 2020-2029 0.1% 0.0% 0.0% 0.0% Customer Classification 1 Energy consumption in 2008 shown for the commercial and public authority classifications is net of large customer loads. Large Customer Loads The City has identified several large power loads based on energy consumption of about 100,000 kWh per month or higher. At the present time, there are twelve customers that meet this criteria, eight of which are commercial customers and four which are public authority customers. Energy sales reports prepared by the City include the large loads as commercial and public authority customers, respectively. Power sales have been forecasted separately for the large power users. The large power users include three large fish processors. The two well established processors pack a wide variety of seafood and use a large amount of electric power almost every month of City and Borough of Sitka 2008 Electric System Load Forecast Page 9 the year. The products are frozen and so the major load is refrigeration. In 2007 both plants upgraded refrigeration capacity to process pink and chum salmon in a whole body form. This was in response to the construction of a large processor at the Sawmill Cove Industrial Park which is designed to freeze whole salmon, herring, and roe. This new processor has very high use in late March and early April and high use during pink and chum salmon runs in the summer. All the processors indicate that large investments were made in 2007 which should carry them into the foreseeable future. The City Cold Storage Facility is fundamentally a large refrigerated box. Product is delivered already frozen and energy use is probably more related to outside temperature than to the amount of product handled. About three years ago outlets were added for several freezer vans and this would be reflected in the 2007 energy use. No expansion is planned and it is expected that energy use at this facility will remain constant in the future. In 2007, there was a record herring harvest but a greatly reduced salmon harvest. The long term outlook does not seem good for a sustained high level salmon harvest. For the processors in the medium and high growth scenarios, it has been assumed that electric loads in the future will remain the same as 2007. In the low case the processor energy use is assumed to drop 10% between 2008 and 2012, another 10% over 2013 to 2019, and another 10% out to 2029. Since maximum demand is based normally on total compressor capacity, it is not expected that demand will change unless a processor ceased to operate. The two large grocery stores in Sitka have performed lighting and refrigeration upgrades in the past few years and there is little reason to think these loads will change significantly even with moderate changes in population. As a result, it has been assumed that the grocery store loads will not change from 2007 levels. SEARHC, the Southeast Alaska Regional Health Consortium is the largest employer in Sitka with over 500 employees. SEARHC is the regional health care center primarily for native health care. It is relatively certain that this facility will continue to operate in the far future. Further, the hospital is being upgraded and some housing is being added to the site. It has been assumed for the medium and high cases that the hospital load remains unchanged and for the low case that some functions are exported to new village clinics and perhaps an outpatient facility in Juneau. Four public authority loads are among the large power consumers. These loads include the US Coast Guard and three facilities of the School District. The US Coast Guard ship Maple, the rescue helicopter base, administrative buildings and housing units would seem to be stable in size and energy use in the foreseeable future and it is assumed that no change will occur in the load for all growth scenarios. The School District has undergone upgrades over the last few years, including a new auditorium in 2007. Student population is declining slightly and no significant new construction is indicated. Schools, however, do not typically reduce electricity use with moderate decreases in enrollment. As a result, it has been assumed that the School District energy use will remain constant for all cases. Energy requirements of the large loads are shown in Table 14. City and Borough of Sitka 2008 Electric System Load Forecast Page 10 Total Energy Sales Based on the forecasted number of customers and the projected electricity use per customer account, total annual energy sales have been forecasted. The results of the forecast for each of the customer classes and for each year of the forecast period are shown in Table 10 and are summarized for selected years in Table 4. As can be seen in Table 4, total energy sales are forecasted to be 115,982 MWh in 2010 for the medium growth scenario. This amount is approximately 6,830 MWh more than was sold in 2008, representing an increase of 6.3%. Much of the increase between actual sales in 2008 and forecasted sales in 2010 is due to the assumption of fairly significant residential electric heat conversions because of high fuel prices. In addition, the increased power sales at the Sawmill Cove industrial site experienced in 2008 are assumed to continue in the future. Total electricity consumption at the Sawmill Cove industrial site (former site of the Alaska Pulp Company pulp mill) was approximately 4,190 MWh in 2008, up significantly over the previous year. Part of the increase is attributable to the summer processing load of Silver Bay Seafoods. This load is expected to continue at its present level. The load of Silver Bay Seafoods is included among the large customer loads described in the previous section of this report. For the purpose of the load forecast, it is assumed that the loads at Sawmill Cove will remain at about the level experienced in 2008 with a slight increase over time for the medium load growth scenario. Alternative high and low forecasts of the load are also included. The total estimated energy requirements at the Sawmill Cove site for each year of the forecast period are shown in Table 10 in the column labeled “SMC”. As previously mentioned, the load of Silver Bay Seafoods, which is located at the Sawmill Cove Industrial Park, is included among the large customer loads. Table 4 Forecasted Total Retail Energy Sales 1 Medium High Low Elec. Vehicle 2008 (Actual) 109,154 109,154 109,154 109,154 2010 115,982 119,515 108,660 119,560 2015 124,184 134,481 113,554 136,330 2020 128,879 141,645 115,473 145,630 2025 132,931 148,573 117,111 154,500 2029 135,696 154,148 117,972 160,280 Average Annual Growth Rates 2008-2010 3.1% 4.6% -0.2% 4.7% 2010-2015 1.4% 2.4% 0.9% 2.7% 2015-2020 0.7% 1.0% 0.3% 1.3% 2020-2029 0.6% 0.9% 0.2% 1.1% 2008-2029 1.0% 1.7% 0.4% 1.8% Total Energy Sales (MWh) 1 Energy sales shown for 2008 exclude 852,120 MWh of interruptible sales. City and Borough of Sitka 2008 Electric System Load Forecast Page 11 Total Energy Requirements The City’s total energy requirements are the sum of total energy sales, interruptible energy sales and energy losses. Non-billed public authority use is approximately 2,200 MWh per year at the present time, however, for the most part this load is accounted for in the public authority customer classification. Interruptible energy sales were 852 MWh in 2008, down significantly from 1,747 MWh in 2007. Interruptible energy sales are only made if surplus hydroelectric energy is available. It can be expected that interruptible sales will vary from year to year and will be under pressure to increase as a result of high fuel oil prices. . Energy losses experienced by the City in the years 2003 through 2008 have varied between 2.5% and 8.2% of total energy requirements, averaging 5.1%. Prior to 2003, energy losses were typically in excess of 6.0% of total energy requirements. It is not known if the significant decrease noted in recent years is due to accounting changes or other factors. For the purpose of the load forecast, energy losses are assumed to be 5.5%, 6.5% and 5.0% of total energy requirements for the medium, high and low load growth scenarios. Forecasted total energy requirements are shown in Table 10 and are summarized in Table 5. Historical and forecasted energy requirements are shown in Figure 3 with average annual growth rates over the periods 1973–2008 and 2008–2029 indicated also. Table 5 Forecasted Total Energy Requirements (Excludes Potential Interruptible Sales) Medium High Low Elec. Vehicle 2008 (Actual) 111,919 111,919 111,919 111,919 2010 122,730 127,820 114,380 127,870 2015 131,410 143,830 119,530 145,810 2020 136,380 151,490 121,550 155,750 2025 140,670 158,900 123,280 165,240 2029 143,590 164,860 124,180 171,420 Average Annual Growth Rates 2008-2010 4.7% 6.9% 1.1% 6.9% 2010-2015 1.4% 2.4% 0.9% 2.7% 2015-2020 0.7% 1.0% 0.3% 1.3% 2020-2029 0.6% 0.9% 0.2% 1.1% 2008-2029 1.2% 1.9% 0.5% 2.1% Total Energy Requirements (MWh) City and Borough of Sitka 2008 Electric System Load Forecast Page 12 Figure 3 Historical and Projected Total Energy Requirements (1973-2029) 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 1973 1977 1981 1985 1989 1993 1997 2001 2005 2009 2013 2017 2021 2025 Fiscal Year Ending June 30Kilowatt-hours (000)Medium Case High Case Low Case City w/o APC Electric Vehicle APC ProjectedHistorical 1 1.2% 0.5% 3.8% Average Growth 1973-2008 1.9% 2.1% Figure 3 shows that average annual load growth experienced by the City was 3.8% over the period 1973 through 2008. Prior to 1995, average annual load growth was significantly higher. The results of the forecast indicate average annual load growth over the next 20 years of 1.2% for the medium growth scenario, 1.9% average annual load growth for the high scenario, 0.5% average growth in loads for the low growth scenario and 2.1% average annual load growth for the electric vehicle scenario. The 2008 Load Forecast indicates higher growth than was forecasted in the 2005 Load Forecast, 1.2% as compared to 0.8% average annual growth for the medium scenario. Most of the higher rate of load growth is attributable to the expected higher use of electric space heat in Sitka. Peak Demand Peak demand of the City’s electric system has been forecasted based on the forecast of total energy requirements and an assumed annual load factor. The load factor is the ratio of peak demand to average demand. In recent years, the City’s annual load factor has been relatively consistent at approximately 60%. For the purposes of the forecast, the annual load factor has been assumed to be 58% for the medium growth scenario, 60% for the low growth scenario and 52% for the high and electric heat scenarios. The forecasted peak demand for each year is shown in Table 10 for the four growth scenarios and is summarized in the following table. City and Borough of Sitka 2008 Electric System Load Forecast Page 13 Table 6 Forecasted Peak Demand (kW) Medium High Low Elec. Vehicle 2008 (Actual) 22,240 22,240 22,240 22,240 2010 24,200 25,600 21,800 25,600 2015 25,900 30,400 22,700 30,800 2020 26,800 33,300 23,100 34,200 2025 27,700 34,900 23,500 36,300 2029 28,300 36,200 23,600 37,600 Average Annual Growth Rates 2008-2010 2.1% 6.3% 0.9% 6.5% 2010-2015 1.3% 2.9% 0.8% 3.2% 2015-2020 0.7% 1.0% 0.3% 1.3% 2020-2029 0.6% 0.9% 0.2% 1.1% 2008-2029 1.2% 2.3% 0.3% 2.5% Peak Demand (kW) Interruptible Energy Sales The City has recently established an interruptible energy sales program to sell surplus hydroelectric generation to government buildings, and potentially industrial facilities, to supplant the use of fuel oil for space and water heating. The price of electricity sold through this program will be tied to the price of fuel oil in Sitka. At the present time, the City Electric Department has identified several interruptible energy customers, primarily schools and other municipal facilities that could potentially begin receiving interruptible service within the next several years. In total, it is estimated that these electric customers can use approximately 52,600 MWh per year of electric energy purchased under the interruptible energy program. Other municipal and commercial facilities have also been identified that could potentially purchase interruptible electric energy in the future. The amount of energy available to serve this interruptible load is dependent on the available hydroelectric generation in any given year. As with all hydroelectric systems, the City’s generation potential varies from year to year depending on local precipitation. It is presently estimated that the average annual energy generation capability of the City’s hydroelectric system is 124,000 MWh. This generation capability is estimated to vary between 85,000 MWh in extremely dry years to 135,000 MWh in very wet years. Further, the City has indicated that a third turbine could potentially be installed at the Blue Lake hydroelectric project that would produce about 16,000 MWh on an average annual basis. In extremely wet years, it is estimated that the third turbine could generate an additional 25,000 MWh whereas in dry years there would be no additional energy generation. Additional hydroelectric capacity is envisioned for the City and Borough of Sitka 2008 Electric System Load Forecast Page 14 future including 19,000 MWh per year from a further expansion of the Blue Lake project and 106,000 MWh per year from the Takatz Lake project that could be constructed as early as 2021. An estimate of potential interruptible energy sales has been developed based on the City’s estimate of potential interruptible municipal and industrial loads and the estimated amount of hydroelectric generation surplus to the needs of the City’s firm energy service customers. As the City’s firm energy loads increase over time, the amount of surplus hydroelectric generation available for interruptible sales will decrease. Further, the amount of surplus hydroelectric generation available in any given year will vary significantly due to seasonal precipitation levels at the time. The estimated interruptible energy sales are shown in Table 12. In summary, interruptible energy sales with the existing installed hydroelectric capacity are estimated to be somewhat limited, ranging between zero in most low and average water years to as high as 12,600 MWh in wet years. Under average water conditions with medium retail load growth and assuming the third turbine at Blue Lake is installed in 2015, interruptible energy sales are estimated to increase. Table 7City and Borough of SitkaHistorical Number of Customer Accounts and Usage Per Customer AccountFiscal Year Residential CommercialRes/Comm Ratio BoatsPublic AuthorityPublic Safety TotalAnnual % Change Residential Commercial BoatsPublic Authority Public Safety Total1973 1,457 216 6.75 153 40 - 1,873 7,308 27,214 1,489 238,838 - 14,047 1974 1,560 221 7.06 160 44 - 1,992 6.4% 7,254 24,602 1,316 197,394 - 12,875 1975 1,666 231 7.21 189 51 - 2,144 7.6% 7,664 25,696 1,557 172,662 - 12,967 1976 1,748 244 7.16 221 53 - 2,273 6.0% 8,248 31,425 1,971 174,911 - 13,985 1977 1,857 252 7.37 236 55 - 2,407 5.9% 8,428 33,005 1,623 177,207 - 14,164 1978 2,015 259 7.78 297 58 - 2,637 9.5% 8,562 35,392 1,705 205,455 - 14,731 1979 2,105 282 7.46 325 63 - 2,782 5.5% 8,577 45,457 1,677 178,357 - 15,330 1980 2,200 298 7.38 334 65 - 2,904 4.4% 8,611 46,959 1,560 152,109 - 14,924 1981 2,316 331 7.00 330 72 - 3,056 5.2% 8,776 44,159 1,591 136,644 - 14,825 1982 2,436 336 7.25 333 70 - 3,182 4.1% 9,593 48,922 1,945 141,655 - 15,828 1983 2,492 369 6.75 347 71 - 3,286 3.3% 9,460 47,407 1,597 143,430 - 15,766 1984 2,540 390 6.51 350 79 - 3,366 2.4% 10,367 51,387 1,844 138,461 - 17,221 1985 2,583 411 6.28 426 90 - 3,516 4.5% 10,816 45,948 1,961 139,051 - 17,112 1986 2,697 419 6.44 462 122 - 3,706 5.4% 10,648 50,898 2,110 116,448 - 17,598 1987 2,784 431 6.46 482 131 - 3,834 3.5% 10,432 56,642 1,954 99,577 - 17,589 1988 2,842 431 6.59 475 135 - 3,890 1.4% 11,333 56,078 2,135 104,930 - 18,398 1989 2,856 418 6.83 453 166 - 3,900 0.3% 12,154 59,656 2,609 94,016 - 19,600 1990 2,898 417 6.95 535 160 - 4,017 3.0% 11,861 63,306 2,134 93,904 - 19,153 1991 2,952 425 6.95 556 154 - 4,094 1.9% 11,835 63,816 2,273 98,930 - 19,188 1992 2,990 431 6.94 590 156 - 4,174 2.0% 12,525 62,549 2,540 106,165 - 19,758 1993 2,952 425 6.95 589 157 - 4,130 -1.1% 13,197 64,992 2,565 110,200 - 20,676 1994 3,010 421 7.15 547 144 - 4,129 0.0% 12,720 65,573 2,535 117,395 - 20,388 1995 3,044 438 6.95 531 139 - 4,159 0.7% 12,544 66,888 2,900 119,237 - 20,581 1996 3,117 440 7.08 557 154 4 4,279 2.9% 12,659 68,339 2,930 115,986 54,243 20,855 1997 3,160 456 6.93 651 153 3 4,430 3.5% 12,272 62,090 3,044 122,392 60,156 19,861 1998 3,193 472 6.76 662 156 3 4,493 1.4% 11,425 59,022 2,853 117,698 60,246 18,868 1999 3,218 506 6.36 690 171 1 4,592 2.2% 12,104 60,045 3,074 115,032 137,400 19,873 2000 3,243 516 6.28 757 172 1 4,695 2.2% 11,508 55,633 3,326 118,849 137,960 18,982 2001 3,333 534 6.24 747 170 1 4,791 2.0% 11,681 53,727 3,286 120,730 152,680 18,942 2002 3,409 570 5.98 699 179 1 4,864 1.5% 11,596 50,357 3,092 113,360 145,600 18,675 2003 3,484 560 6.22 685 185 1 4,921 1.2% 11,070 52,006 3,036 117,753 260,367 18,657 2004 3,473 563 6.17 746 192 1 4,981 1.2% 11,317 51,690 3,297 114,935 178,659 18,692 2005 3,488 597 5.84 754 189 - 5,034 1.1% 11,379 49,677 3,245 117,341 - 18,668 2006 3,524 614 5.74 728 189 - 5,061 0.5% 11,811 48,830 3,550 118,234 - 19,075 2007 3,584 620 5.78 723 184 - 5,117 1.1% 12,575 49,885 4,339 127,205 - 20,040 2008 3,621 619 5.85 748 186 - 5,180 1.2% 12,813 51,739 4,923 122,901 - 20,264 Compound Annual Growth Rates (Unless Marked Average): Average1973-2008 2.6% 3.1% -0.4% 4.6% 4.5% 2.9% 3.0% 1.6% 1.9% 3.5% -1.9% 1.1%1973-1993 3.6% 3.4% 0.1% 7.0% 7.1% 4.0% 4.1% 3.0% 4.4% 2.8% -3.8% 2.0%1993-2008 1.4% 2.5% -1.1% 1.6% 1.1% 1.5% 1.4% -0.2% -1.5% 4.4% 0.7% -0.1%2001-2008 1.2% 2.1% -0.9% 0.0% 1.3% 1.1% 1.2% 1.3% -0.5% 5.9% 0.3% 1.0%2003-2008 0.8% 2.0% -1.2% 1.8% 0.1% 1.0% 1.1% 3.0% -0.1% 10.2% 0.9% 1.7%Number of Accounts Average Usage per Customer Account (kWh)D.Hittle & Associates9/12/2008 Table 8City and Borough of SitkaHistorical Energy Sales, Total Requirements and Losses(kilowatt-hours)Fiscal Year Residential Commercial BoatsPublic AuthorityPublic Safety Total RetailAnnual % Change APC/SCIPInterruptible Sales Total Sales PA - Nonbill LossesTotal Requirements Loss %1973 10,647,500 5,878,143 227,791 9,553,520 - 26,306,954 - - 26,306,954 - 4,346,746 30,653,700 14.2%1974 11,315,790 5,437,106 210,480 8,685,340 - 25,648,716 -2.5% - - 25,648,716 - 3,660,084 29,308,800 12.5%1975 12,768,138 5,935,735 294,250 8,805,740 - 27,803,863 8.4% - - 27,803,863 - 4,401,237 32,205,100 13.7%1976 14,417,801 7,667,679 435,571 9,270,277 - 31,791,328 14.3% - - 31,791,328 - 4,462,772 36,254,100 12.3%1977 15,650,544 8,317,159 382,960 9,746,410 - 34,097,073 7.3% - - 34,097,073 - 3,673,927 37,771,000 9.7%1978 17,253,384 9,166,472 506,411 11,916,385 - 38,842,652 13.9% - - 38,842,652 - 4,751,348 43,594,000 10.9%1979 18,054,525 12,818,950 545,180 11,236,489 - 42,655,144 9.8% - - 42,655,144 - 3,316,556 45,971,700 7.2%1980 18,943,385 13,993,874 521,013 9,887,091 - 43,345,363 1.6% - - 43,345,363 - 5,004,037 48,349,400 10.3%1981 20,324,848 14,616,568 525,157 9,838,403 - 45,304,976 4.5% - - 45,304,976 - 8,135,824 53,440,800 15.2%1982 23,368,046 16,437,777 647,625 9,915,842 - 50,369,290 11.2% 6,900,000 - 57,269,290 - 6,868,310 64,137,600 10.7%1983 23,573,597 17,493,123 554,146 10,183,532 - 51,804,398 2.8% 31,109,600 - 82,913,998 - 7,186,902 90,100,900 8.0%1984 26,333,102 20,040,862 645,320 10,938,427 - 57,957,711 11.9% 35,036,400 - 92,994,111 - 5,229,889 98,224,000 5.3%1985 27,936,606 18,884,763 835,230 12,514,602 - 60,171,201 3.8% 36,607,200 - 96,778,401 - 8,224,599 105,003,000 7.8%1986 28,718,308 21,326,412 974,641 14,206,699 - 65,226,060 8.4% 27,937,800 - 93,163,860 - 8,151,140 101,315,000 8.0%1987 29,043,644 24,412,603 941,876 13,044,581 - 67,442,704 3.4% 27,190,800 - 94,633,504 - 9,642,496 104,276,000 9.2%1988 32,209,398 24,169,740 1,014,325 14,165,572 - 71,559,035 6.1% 27,963,600 - 99,522,635 - 7,816,665 107,339,300 7.3%1989 34,710,595 24,936,120 1,181,668 15,606,679 - 76,435,062 6.8% 16,258,800 - 92,693,862 - 7,917,138 100,611,000 7.9%1990 34,373,267 26,398,742 1,141,738 15,024,583 - 76,938,330 0.7% 4,905,600 - 81,843,930 664,622 7,947,370 89,791,300 8.9%1991 34,935,593 27,121,821 1,263,561 15,235,263 - 78,556,238 2.1% 5,737,400 - 84,293,638 1,369,132 10,888,362 95,182,000 11.4%1992 37,451,051 26,958,569 1,498,453 16,561,759 - 82,469,832 5.0% 5,132,400 42,000 87,602,232 1,544,472 8,229,008 95,831,240 8.6%1993 38,956,991 27,621,495 1,510,874 17,301,455 - 85,390,815 3.5% 4,785,912 180,120 90,176,727 1,356,274 7,535,192 97,711,919 7.7%1994 38,288,017 27,606,075 1,386,858 16,904,829 - 84,185,779 -1.4% 2,485,564 - 86,671,343 1,608,195 7,677,558 94,348,901 8.1%1995 38,184,665 29,296,821 1,540,057 16,573,953 - 85,595,496 1.7% 961,581 - 86,557,077 2,086,615 9,981,332 96,538,409 10.3%1996 39,458,367 30,069,034 1,632,084 17,861,827 216,970 89,238,282 4.3% 1,074,420 - 90,312,702 1,036,839 7,894,079 98,206,781 8.0%1997 38,779,249 28,313,214 1,981,768 18,725,998 180,468 87,980,697 -1.4% 904,915 - 88,885,612 947,659 7,043,924 95,929,536 7.3%1998 36,481,297 27,858,302 1,888,963 18,360,839 180,737 84,770,138 -3.6% 789,265 - 85,559,403 911,692 8,940,267 94,499,670 9.5%1999 38,950,365 30,382,830 2,121,381 19,670,460 137,400 91,262,436 7.7% 629,585 - 91,892,021 988,605 3,635,201 95,527,222 3.8%2000 37,321,128 28,706,403 2,517,425 20,441,975 137,960 89,124,891 -2.3% 506,274 - 89,631,165 1,480,197 4,998,244 94,629,409 5.3%2001 38,932,335 28,690,283 2,454,601 20,524,065 152,680 90,753,964 1.8% 399,516 - 91,153,480 1,493,985 3,761,159 94,914,639 4.0%2002 39,530,730 28,703,289 2,161,435 20,291,474 145,600 90,832,528 0.1% 969,844 - 91,802,372 1,577,104 7,402,134 99,204,506 7.5%2003 38,569,146 29,123,395 2,079,515 21,784,389 260,367 91,816,812 1.1% 914,387 - 92,731,199 1,723,933 3,925,133 96,656,332 4.1%2004 39,303,610 29,101,299 2,459,212 22,067,517 178,659 93,110,297 1.4% 1,524,713 - 94,635,010 1,723,855 8,412,968 103,047,978 8.2%2005 39,690,807 29,657,231 2,446,827 22,177,417 - 93,972,282 0.9% 1,702,168 - 95,674,450 1,500,000 5,651,447 101,325,897 5.6%2006 41,623,109 29,981,828 2,584,622 22,346,191 - 96,535,750 2.7% 1,871,596 - 98,407,346 1,597,586 6,286,474 104,693,820 6.0%2007 45,069,093 30,928,679 3,137,092 23,405,628 - 102,540,492 6.2% 2,203,633 1,746,960 106,491,085 1,934,921 4,882,087 111,373,172 4.4%2008 46,396,181 32,026,170 3,682,664 22,859,652 - 104,964,667 2.4% 4,189,777 852,120 110,006,564 2,195,316 2,765,003 112,771,567 2.5%Compound Annual Growth Rates (Unless Marked Average): AverageAverage1973-2008 4.3% 5.0% 8.3% 2.5% 4.0% 4.1% 4.2% -1.3% 3.8% 8.4%1973-1993 6.7% 8.0% 9.9% 3.0% 6.1% 6.2% 6.4% 2.8% 6.0% 9.9%1993-2008 1.2% 1.0% 6.1% 1.9% 1.4% 1.6% 1.3% -6.5% 1.0% 6.4%2003-2008 3.8% 1.9% 12.1% 1.0% 2.7% 2.5% 35.6% 3.5% 5.0% -6.8% 3.1% 5.1%D.Hittle & Associates9/12/2008 Table 8ACity and Borough of SitkaHistorical Peak Loads and Load Factor(kilowatts)Fiscal Year City SystemTotal Generation (Average kW)Less: Sales to APC (Average kW)Net Retail Generation (Average kW)System LoadfactorRetail Loadfactor1973 6,400 3,499 - 3,499 54.7% 54.7%1974 5,950 3,346 - 3,346 56.2% 56.2%1975 7,100 3,676 - 3,676 51.8% 51.8%1976 7,200 4,127 - 4,127 57.3% 57.3%1977 7,550 4,312 - 4,312 57.1% 57.1%1978 8,795 4,976 - 4,976 56.6% 56.6%1979 9,200 5,248 - 5,248 57.0% 57.0%1980 9,700 5,504 - 5,504 56.7% 56.7%1981 10,500 6,101 - 6,101 58.1% 58.1%1982 11,000 7,322 788 6,534 66.6% 59.4%1983 12,055 10,285 3,551 6,734 85.3% 55.9%1984 12,343 11,182 3,989 7,193 90.6% 58.3%1985 14,738 11,987 4,179 7,808 81.3% 53.0%1986 15,440 11,566 3,189 8,376 74.9% 54.3%1987 14,636 11,904 3,104 8,800 81.3% 60.1%1988 16,711 12,220 3,183 9,036 73.1% 54.1%1989 17,512 11,485 1,856 9,629 65.6% 55.0%1990 16,785 19,868 10,250 560 9,690 61.1% 57.7%1991 17,670 20,320 10,866 655 10,211 61.5% 57.8%1992 16,557 19,829 10,910 584 10,325 65.9% 62.4%1993 18,972 22,047 11,154 546 10,608 58.8% 55.9%1994 19,105 19,255 10,770 - 10,770 56.4% 56.4%1995 19,364 19,364 11,020 - 11,020 56.9% 56.9%1996 19,938 19,938 11,180 - 11,180 56.1% 56.1%1997 18,730 18,730 10,951 - 10,951 58.5% 58.5%1998 17,527 17,527 10,788 - 10,788 61.5% 61.5%1999 17,732 17,732 10,905 - 10,905 61.5% 61.5%2000 17,664 17,664 10,773 - 10,773 61.0% 61.0%2001 17,582 17,582 10,835 - 10,835 61.6% 61.6%2002 18,113 18,113 11,325 - 11,325 62.5% 62.5%2003 17,544 17,544 11,034 - 11,034 62.9% 62.9%2004 19,834 19,834 11,731 - 11,731 59.1% 59.1%2005 19,100 19,100 11,567 - 11,567 60.6% 60.6%2006 20,770 20,770 11,951 - 11,951 57.5% 57.5%2007 20,480 20,480 12,714 - 12,714 62.1% 62.1%2008 22,240 22,240 12,838 - 12,838 57.7% 57.7%Compound Annual Growth Rates (Unless Marked Average): Average Average1973-2008 3.6% 3.8% 3.8% 63.0% 57.9%1973-1993 5.6% 6.0% 5.7% 65.3% 56.6%1993-2004 0.4% 0.5% -17.1% 0.9% 59.7% 59.5%2003-2008 4.9% 4.9% 3.1% 3.1% 60.0% 60.0%D. Hittle & Associates9/12/2008 Table 9City and Borough of Sitka2008 Electric Load ForecastForecasted Number of Customer Accounts and Usage Per Customer AccountMEDIUM CASEFiscal Year Residential CommercialRes/Comm Ratio BoatsPublic AuthorityInterrpt. Industr.Large Loads Total% Change Residential Commercial BoatsPublic Authority Non-Billed Total2008 (Act) 3,621 611 5.85 748 182 - 12 5,174 12,813 28,830 4,923 103,970 - 17,226 2009 3,645 620 5.88 762 196 1 12 5,236 1.2% 13,210 28,970 4,950 104,490 - 21,198 2010 3,669 629 5.83 776 202 3 12 5,291 1.1% 13,610 29,110 4,970 105,010 - 21,535 2011 3,692 637 5.80 789 206 7 12 5,343 1.0% 13,760 29,260 4,990 105,540 - 21,540 2012 3,713 645 5.76 802 208 7 12 5,387 0.8% 13,910 29,410 5,010 106,070 - 21,780 2013 3,733 653 5.72 814 210 7 12 5,429 0.8% 14,060 29,560 5,040 106,600 - 21,902 2014 3,752 660 5.68 826 212 7 12 5,469 0.7% 14,210 29,710 5,070 107,130 - 22,025 2015 3,770 667 5.65 838 214 7 12 5,508 0.7% 14,370 29,860 5,100 107,670 - 22,156 2016 3,787 674 5.62 849 215 7 12 5,544 0.7% 14,390 30,010 5,130 108,210 - 22,160 2017 3,803 681 5.58 860 217 7 12 5,580 0.6% 14,410 30,160 5,160 108,750 - 22,223 2018 3,818 687 5.56 870 218 7 12 5,612 0.6% 14,430 30,310 5,190 109,290 - 22,254 2019 3,832 693 5.53 880 219 7 12 5,643 0.6% 14,450 30,460 5,220 109,840 - 22,286 2020 3,845 699 5.50 890 220 7 12 5,673 0.5% 14,470 30,610 5,250 110,390 - 22,320 2021 3,857 704 5.48 899 221 7 12 5,700 0.5% 14,490 30,760 5,280 110,940 - 22,320 2022 3,868 709 5.46 908 222 7 12 5,726 0.5% 14,510 30,910 5,310 111,490 - 22,320 2023 3,878 714 5.43 916 223 7 12 5,750 0.4% 14,530 31,060 5,340 112,050 - 22,320 2024 3,887 719 5.41 924 224 7 12 5,773 0.4% 14,550 31,220 5,370 112,610 - 22,320 2025 3,895 723 5.39 932 225 7 12 5,794 0.4% 14,570 31,380 5,400 113,170 - 22,320 2026 3,902 727 5.37 939 226 7 12 5,813 0.3% 14,590 31,540 5,430 113,740 - 22,320 2027 3,909 731 5.35 946 226 7 12 5,831 0.3% 14,610 31,700 5,460 114,310 - 22,320 2028 3,915 735 5.33 953 227 7 12 5,849 0.3% 14,630 31,860 5,490 114,880 - 22,320 2029 3,921 739 5.31 960 227 7 12 5,866 0.3% 14,650 32,020 5,520 115,450 - 22,320 Compound Annual Growth Rates (Unless Marked Average): Average2008-2010 0.6% 1.4% -0.7% 1.8% 2.5% 1.0% 1.1% 3.1% 0.5% 0.5% 0.5% 0.0%2010-2015 0.5% 1.1% -0.6% 1.5% 0.9% 0.7% 0.8% 1.1% 0.5% 0.5% 0.5% 0.0%2015-2020 0.3% 0.8% -0.5% 1.1% 0.5% 0.5% -6.5% 0.1% 0.5% 0.5% 0.5% 0.0%2020-2029 0.2% 0.6% -0.4% 0.8% 0.3% 0.4% 0.1% 0.5% 0.5% 0.5%2008-2029 0.4% 0.9% -0.5% 1.2% 1.1% 0.6%Number of Accounts Average Usage per Customer Account (kWh)D.Hittle and Associates Page 1 of 3 9/12/2008 Table 9City and Borough of Sitka2008 Electric Load ForecastForecasted Number of Customer Accounts and Usage Per Customer AccountHIGH CASEFiscal Year Residential CommercialRes/Comm Ratio BoatsPublic AuthorityInterrpt. Industr.Large Loads Total% Change Residential Commercial BoatsPublic Authority Non-Billed Total2008 (Act) 3,621 611 5.85 748 182 - 12 5,174 12,813 28,830 4,923 103,970 - - 2009 3,645 620 5.88 762 196 1 12 5,242 1.3% 13,310 29,410 4,970 107,090 - 21,396 2010 3,669 629 5.83 776 202 3 12 5,297 1.0% 13,820 30,000 5,020 110,300 - 21,972 2011 3,692 637 5.80 789 206 7 12 5,349 1.0% 14,220 30,300 5,070 111,400 - 21,970 2012 3,715 645 5.76 802 208 7 12 5,395 0.9% 14,630 30,600 5,120 112,510 - 22,656 2013 3,737 653 5.72 814 210 7 12 5,439 0.8% 15,050 30,910 5,170 113,640 - 23,007 2014 3,759 660 5.70 826 212 7 12 5,482 0.8% 15,480 31,220 5,220 114,780 - 23,363 2015 3,780 667 5.67 838 214 7 12 5,524 0.8% 15,920 31,530 5,270 115,930 - 23,728 2016 3,801 674 5.64 849 216 7 12 5,565 0.7% 15,940 31,850 5,320 117,090 - 23,730 2017 3,821 681 5.61 860 218 7 12 5,605 0.7% 15,960 32,170 5,370 118,260 - 23,894 2018 3,841 688 5.58 871 220 7 12 5,645 0.7% 15,980 32,490 5,420 119,440 - 23,980 2019 3,861 694 5.56 881 222 7 12 5,683 0.7% 16,000 32,810 5,470 120,630 - 24,069 2020 3,880 700 5.54 891 223 7 12 5,719 0.6% 16,020 33,140 5,520 121,840 - 24,145 2021 3,899 706 5.52 900 225 7 12 5,755 0.6% 16,030 33,470 5,580 123,060 - 24,140 2022 3,918 712 5.50 909 227 7 12 5,791 0.6% 16,040 33,800 5,640 124,290 - 24,330 2023 3,937 718 5.48 918 228 7 12 5,825 0.6% 16,050 34,140 5,700 125,530 - 24,407 2024 3,955 723 5.47 927 230 7 12 5,859 0.6% 16,060 34,480 5,760 126,790 - 24,503 2025 3,973 728 5.46 935 231 7 12 5,891 0.5% 16,070 34,820 5,820 128,060 - 24,586 2026 3,991 733 5.44 943 233 7 12 5,924 0.6% 16,080 35,170 5,880 129,340 - 24,688 2027 4,009 738 5.43 951 234 7 12 5,956 0.5% 16,090 35,520 5,940 130,630 - 24,774 2028 4,026 743 5.42 958 236 7 12 5,987 0.5% 16,100 35,880 6,000 131,940 - 24,884 2029 4,043 748 5.41 965 237 7 12 6,017 0.5% 16,110 36,240 6,060 133,260 - 24,978 Compound Annual Growth Rates (Unless Marked Average): Average2008-2010 0.6% 1.4% -0.7% 1.8% 2.5% 1.0% 1.1% 3.9% 2.0% 1.0% 3.0% 0.0%2010-2015 0.6% 1.1% -0.5% 1.5% 1.0% 0.8% 0.8% 2.9% 1.0% 1.0% 1.0% 0.0%2015-2020 0.5% 0.8% -0.4% 1.1% 0.8% 0.6% 0.6% 0.1% 1.0% 1.0% 1.0% 0.0%2020-2029 0.5% 0.9% -0.4% 1.2% 1.0% 0.7% 0.7% 0.1% 1.0% 1.0% 1.0% 0.0%Number of Accounts Average usage per Customer Account (kWh)D.Hittle and Associates Page 2 of 3 9/12/2008 Table 9City and Borough of Sitka2008 Electric Load ForecastForecasted Number of Customer Accounts and Usage Per Customer AccountLOW CASEFiscal Year Residential CommercialRes/Comm Ratio BoatsPublic AuthorityInterrpt. Industr.Large Loads Total% Change Residential Commercial BoatsPublic Authority Non-Billed Total2007 (Act) 3,584 611 5.78 723 182 - 12 5,112 12,575 28,830 4,339 103,970 - 17,434 2009 3,608 619 5.83 740 193 1 12 5,179 1.3% 12,750 28,400 4,270 102,410 - 20,522 2010 3,630 627 5.79 756 199 3 12 5,233 1.0% 12,930 27,970 4,210 100,870 - 20,540 2011 3,649 635 5.75 772 202 7 12 5,283 1.0% 13,060 27,970 4,210 100,870 - 20,540 2012 3,667 643 5.70 787 204 7 12 5,326 0.8% 13,190 27,970 4,210 100,870 - 20,646 2013 3,684 650 5.67 801 206 7 12 5,366 0.8% 13,320 27,970 4,210 100,870 - 20,545 2014 3,699 657 5.63 814 207 7 12 5,402 0.7% 13,450 27,970 4,210 100,870 - 20,596 2015 3,713 663 5.60 827 209 7 12 5,437 0.6% 13,590 27,970 4,210 100,870 - 20,668 2016 3,726 669 5.57 839 210 7 12 5,469 0.6% 13,610 27,970 4,210 100,870 - 20,670 2017 3,738 675 5.54 850 211 7 12 5,499 0.5% 13,630 27,970 4,210 100,870 - 20,632 2018 3,749 681 5.51 861 212 7 12 5,528 0.5% 13,650 27,970 4,210 100,870 - 20,618 2019 3,759 686 5.48 871 213 7 12 5,553 0.5% 13,670 27,970 4,210 100,870 - 20,453 2020 3,768 691 5.45 881 214 7 12 5,578 0.4% 13,690 27,970 4,210 100,870 - 20,444 2021 3,776 696 5.43 890 215 7 12 5,601 0.4% 13,700 27,970 4,210 100,870 - 20,440 2022 3,783 701 5.40 899 215 7 12 5,622 0.4% 13,710 27,970 4,210 100,870 - 20,409 2023 3,790 705 5.38 907 216 7 12 5,642 0.4% 13,720 27,970 4,210 100,870 - 20,400 2024 3,796 709 5.35 915 217 7 12 5,661 0.3% 13,730 27,970 4,210 100,870 - 20,393 2025 3,801 713 5.33 922 217 7 12 5,677 0.3% 13,740 27,970 4,210 100,870 - 20,377 2026 3,806 717 5.31 929 217 7 12 5,693 0.3% 13,750 27,970 4,210 100,870 - 20,360 2027 3,810 720 5.29 936 218 7 12 5,708 0.3% 13,760 27,970 4,210 100,870 - 20,357 2028 3,813 723 5.27 942 218 7 12 5,720 0.2% 13,770 27,970 4,210 100,870 - 20,344 2029 3,816 726 5.26 948 218 7 12 5,732 0.2% 13,780 27,970 4,210 100,870 - 20,331 Compound Annual Growth Rates (Unless Marked Average): Average2008-2010 0.6% 1.3% -0.7% 2.1% 2.3% 1.0% 1.1% 1.4% -1.5% -1.5% -1.5% 0.0%2010-2015 0.4% 1.0% -0.6% 1.7% 0.8% 0.7% 0.7% 1.0% 0.0% 0.0% 0.0% 0.0%2015-2020 0.2% 0.7% -0.5% 1.0% 0.3% 0.4% 0.4% 0.2% 0.0% 0.0% 0.0% 0.0%2020-2028 0.3% 0.8% -0.5% 1.2% 0.6% 0.5% 0.5% 0.1% 0.0% 0.0% 0.0% 0.0%Number of Accounts Average usage per Customer Account (kWh)D.Hittle and Associates Page 3 of 3 9/12/2008 Table 10City and Borough of Sitka2008 Electric Load ForecastForecasted Energy Sales, Total Requirements, Losses and Peak Demand(kilowatt-hours)MEDIUM CASEFiscal Year Residential Commercial BoatsPublic Authority Large Loads Total RetailAnnual % ChangeSMC (less Silver Bay Seafoods) Total SalesPA - Nonbill (Included in Pub Auth) LossesTotal Requirements Loss %Peak Demand (kW)Load Factor2008 (Act) 46,396,181 17,617,210 3,682,664 18,921,972 20,688,080 107,306,107 1,848,337 109,154,444 2,195,316 2,765,003 111,919,447 2.5% 22,240 57.7%2009 48,150,500 17,961,400 3,771,900 20,480,000 20,629,460 110,993,260 3.4% 1,863,360 112,856,620 2,376,100 6,568,380 119,425,000 5.5% 23,500 58.0%2010 49,935,100 18,310,200 3,856,700 21,212,000 20,629,460 113,943,460 2.7% 2,038,560 115,982,020 2,461,000 6,750,280 122,732,300 5.5% 24,200 58.0%2011 50,801,900 18,638,600 3,937,100 21,741,200 20,629,460 115,748,260 1.6% 2,060,460 117,808,720 2,522,400 6,856,580 124,665,300 5.5% 24,500 58.0%2012 51,647,800 18,969,500 4,018,000 22,062,600 20,629,460 117,327,360 1.4% 2,082,360 119,409,720 2,559,700 6,949,780 126,359,500 5.5% 24,900 58.0%2013 52,486,000 19,302,700 4,102,600 22,386,000 20,629,460 118,906,760 1.3% 2,104,260 121,011,020 2,597,200 7,042,980 128,054,000 5.5% 25,200 58.0%2014 53,315,900 19,608,600 4,187,800 22,711,600 20,629,460 120,453,360 1.3% 2,126,160 122,579,520 2,635,000 7,134,280 129,713,800 5.5% 25,500 58.0%2015 54,174,900 19,916,600 4,273,800 23,041,400 20,629,460 122,036,160 1.3% 2,148,060 124,184,220 2,673,300 7,227,680 131,411,900 5.5% 25,900 58.0%2016 54,494,900 20,226,700 4,355,400 23,265,200 20,629,460 122,971,660 0.8% 2,169,960 125,141,620 2,699,300 7,283,380 132,425,000 5.5% 26,100 58.0%2017 54,801,200 20,539,000 4,437,600 23,598,800 20,629,460 124,006,060 0.8% 2,191,860 126,197,920 2,738,000 7,344,880 133,542,800 5.5% 26,300 58.0%2018 55,093,700 20,823,000 4,515,300 23,825,200 20,629,460 124,886,660 0.7% 2,213,760 127,100,420 2,764,300 7,397,380 134,497,800 5.5% 26,500 58.0%2019 55,372,400 21,108,800 4,593,600 24,055,000 20,629,460 125,759,260 0.7% 2,235,660 127,994,920 2,791,000 7,449,480 135,444,400 5.5% 26,700 58.0%2020 55,637,200 21,396,400 4,672,500 24,285,800 20,629,460 126,621,360 0.7% 2,257,560 128,878,920 2,817,800 7,500,880 136,379,800 5.5% 26,800 58.0%2021 55,887,900 21,655,000 4,746,700 24,517,700 20,629,460 127,436,760 0.6% 2,279,460 129,716,220 2,844,700 7,549,580 137,265,800 5.5% 27,000 58.0%2022 56,124,700 21,915,200 4,821,500 24,750,800 20,629,460 128,241,660 0.6% 2,301,360 130,543,020 2,871,700 7,597,780 138,140,800 5.5% 27,200 58.0%2023 56,347,300 22,176,800 4,891,400 24,987,200 20,629,460 129,032,160 0.6% 2,323,260 131,355,420 2,899,100 7,644,980 139,000,400 5.5% 27,400 58.0%2024 56,555,900 22,447,200 4,961,900 25,224,600 20,629,460 129,819,060 0.6% 2,345,160 132,164,220 2,926,600 7,692,080 139,856,300 5.5% 27,500 58.0%2025 56,750,200 22,687,700 5,032,800 25,463,300 20,629,460 130,563,460 0.6% 2,367,060 132,930,520 2,954,300 7,736,680 140,667,200 5.5% 27,700 58.0%2026 56,930,200 22,929,600 5,098,800 25,705,200 20,629,460 131,293,260 0.6% 2,388,960 133,682,220 2,982,400 7,780,480 141,462,700 5.5% 27,800 58.0%2027 57,110,500 23,172,700 5,165,200 25,834,100 20,629,460 131,911,960 0.5% 2,410,860 134,322,820 2,997,400 7,817,780 142,140,600 5.5% 28,000 58.0%2028 57,276,500 23,417,100 5,232,000 26,077,800 20,629,460 132,632,860 0.5% 2,432,760 135,065,620 3,025,700 7,860,980 142,926,600 5.5% 28,100 58.0%2029 57,442,700 23,662,800 5,299,200 26,207,200 20,629,460 133,241,360 0.5% 2,454,660 135,696,020 3,040,700 7,897,680 143,593,700 5.5% 28,300 58.0%Compound Annual Growth Rates (Unless Marked Average): AverageAverage2008-2010 3.7% 1.9% 2.3% 5.9% -0.1% 3.0% 3.0% 5.0% 3.1% 5.9% 56.2% 4.7% 4.5% 2.1% 0.0%2010-2015 1.6% 1.7% 2.1% 1.7% 0.0% 1.4% 1.4% 1.1% 1.4% 1.7% 1.4% 1.4% 5.5% 1.3% 0.0%2015-2020 0.5% 1.4% 1.8% 1.1% 0.0% 0.7% 0.7% 1.0% 0.7% 1.1% 0.7% 0.7% 5.5% 0.7% 0.0%2020-2029 0.4% 1.1% 1.4% 0.8% 0.0% 0.6% 0.6% 0.9% 0.6% 0.8% 0.6% 0.6% 5.5% 0.6% 0.0%2008-2029 1.0% 1.4% 1.7% 1.6% 0.0% 1.0% 1.0% 1.4% 1.0% 1.6% 5.1% 1.2% 5.5% 1.2% 0.0%D.Hittle and Associates Page 1 of 49/12/2008 Table 10City and Borough of Sitka2008 Electric Load ForecastForecasted Energy Sales, Total Requirements, Losses and Peak Demand(kilowatt-hours)HIGH CASEFiscal Year Residential Commercial BoatsPublic Authority Large Loads Total RetailAnnual % ChangeSMC (less Silver Bay Seafoods) Total Sales PA - Nonbill LossesTotal Requirements Loss %Peak Demand (kW)Load Factor2008 (Act) 46,396,181 17,617,210 3,682,664 18,921,972 20,688,080 107,306,107 1,848,337 109,154,444 2,195,316 2,765,003 111,919,447 2.5% 22,240 57.7%2009 48,515,000 18,234,200 3,787,100 20,989,600 20,629,460 112,155,360 4.5% 2,038,560 114,193,920 2,435,200 7,938,580 122,132,500 6.5% 24,500 57.0%2010 50,705,600 18,870,000 3,895,500 22,280,600 20,629,460 116,381,160 3.8% 3,133,560 119,514,720 2,585,000 8,308,480 127,823,200 6.5% 25,600 57.0%2011 52,500,200 19,301,100 4,000,200 22,948,400 20,629,460 119,379,360 2.6% 3,190,500 122,569,860 2,662,500 8,520,940 131,090,800 6.5% 27,700 54.0%2012 54,350,500 19,737,000 4,106,200 23,402,100 20,629,460 122,225,260 2.4% 3,247,440 125,472,700 2,715,100 8,722,700 134,195,400 6.5% 28,400 54.0%2013 56,241,900 20,184,200 4,208,400 23,864,400 20,629,460 125,128,360 2.4% 3,304,380 128,432,740 2,768,700 8,928,460 137,361,200 6.5% 29,000 54.0%2014 58,189,300 20,605,200 4,311,700 24,333,400 20,629,460 128,069,060 2.4% 3,361,320 131,430,380 2,823,100 9,136,920 140,567,300 6.5% 29,700 54.0%2015 60,177,600 21,030,500 4,416,300 24,809,000 20,629,460 131,062,860 2.3% 3,418,260 134,481,120 2,878,300 9,348,980 143,830,100 6.5% 30,400 54.0%2016 60,587,900 21,466,900 4,516,700 25,291,400 20,629,460 132,492,360 1.1% 3,448,920 135,941,280 2,934,300 9,450,420 145,391,700 6.5% 31,900 52.0%2017 60,983,200 21,907,800 4,618,200 25,780,700 20,629,460 133,919,360 1.1% 3,479,580 137,398,940 2,991,100 9,551,760 146,950,700 6.5% 32,300 52.0%2018 61,379,200 22,353,100 4,720,800 26,276,800 20,629,460 135,359,360 1.1% 3,510,240 138,869,600 3,048,700 9,654,000 148,523,600 6.5% 32,600 52.0%2019 61,776,000 22,770,100 4,819,100 26,779,900 20,629,460 136,774,560 1.0% 3,540,900 140,315,460 3,107,100 9,754,540 150,070,000 6.5% 32,900 52.0%2020 62,157,600 23,198,000 4,918,300 27,170,300 20,629,460 138,073,660 0.9% 3,571,560 141,645,220 3,152,400 9,846,980 151,492,200 6.5% 33,300 52.0%2021 62,501,000 23,629,800 5,022,000 27,688,500 20,629,460 139,470,760 1.0% 3,602,220 143,072,980 3,212,500 9,946,220 153,019,200 6.5% 33,600 52.0%2022 62,844,700 24,065,600 5,126,800 28,213,800 20,629,460 140,880,360 1.0% 3,632,880 144,513,240 3,273,400 10,046,360 154,559,600 6.5% 33,900 52.0%2023 63,188,900 24,512,500 5,232,600 28,620,800 20,629,460 142,184,260 0.9% 3,663,540 145,847,800 3,320,600 10,139,200 155,987,000 6.5% 34,200 52.0%2024 63,517,300 24,929,000 5,339,500 29,161,700 20,629,460 143,576,960 1.0% 3,694,200 147,271,160 3,383,400 10,238,140 157,509,300 6.5% 34,600 52.0%2025 63,846,100 25,349,000 5,441,700 29,581,900 20,629,460 144,848,160 0.9% 3,724,860 148,573,020 3,432,200 10,328,580 158,901,600 6.5% 34,900 52.0%2026 64,175,300 25,779,600 5,544,800 30,136,200 20,629,460 146,265,360 1.0% 3,755,520 150,020,880 3,496,500 10,429,220 160,450,100 6.5% 35,200 52.0%2027 64,504,800 26,213,800 5,648,900 30,567,400 20,629,460 147,564,360 0.9% 3,786,180 151,350,540 3,546,500 10,521,660 161,872,200 6.5% 35,500 52.0%2028 64,818,600 26,658,800 5,748,000 31,137,800 20,629,460 148,992,660 1.0% 3,816,840 152,809,500 3,612,700 10,623,100 163,432,600 6.5% 35,900 52.0%2029 65,132,700 27,107,500 5,847,900 31,582,600 20,629,460 150,300,160 0.9% 3,847,500 154,147,660 3,664,300 10,716,140 164,863,800 6.5% 36,200 52.0%Compound Annual Growth Rates (Unless Marked Average): AverageAverage2008-2010 4.5% 3.5% 2.8% 8.5% -0.1% 4.1% 4.1% 30.2% 4.6% 8.5% 73.3% 6.9% 5.2% 6.3% -2.7%2010-2015 3.5% 2.2% 2.5% 2.2% 0.0% 2.4% 2.4% 1.8% 2.4% 2.2% 2.4% 2.4% 6.5% 2.9% -0.8%2015-2020 0.6% 2.0% 2.2% 1.8% 0.0% 1.0% 1.0% 0.9% 1.0% 1.8% 1.0% 1.0% 6.5% 1.0% 0.0%2020-2029 0.5% 1.7% 1.9% 1.7% 0.0% 0.9% 0.9% 0.8% 0.9% 1.7% 0.9% 0.9% 6.5% 0.9% 0.0%2008-2029 1.6% 2.1% 2.2% 2.5% 0.0% 1.6% 1.6% 3.6% 1.7% 2.5% 6.7% 1.9% 6.5% 2.3% -0.5%D.Hittle and Associates Page 2 of 49/12/2008 Table 10City and Borough of Sitka2008 Electric Load ForecastForecasted Energy Sales, Total Requirements, Losses and Peak Demand(kilowatt-hours)LOW CASEFiscal Year Residential Commercial BoatsPublic Authority Large Loads Total RetailAnnual % ChangeSMC (less Silver Bay Seafoods) Total Sales PA - Nonbill LossesTotal Requirements Loss %Peak Demand (kW)Load Factor2008 (Act) 46,396,181 17,617,210 3,682,664 18,921,972 20,688,080 107,306,107 1,848,337 109,154,444 2,195,316 2,765,003 111,919,447 2.5% 22,240 57.7%2009 46,002,000 17,579,600 3,159,800 19,765,100 19,774,616 106,281,116 -1.0% 1,615,704 107,896,820 2,293,100 5,678,780 113,575,600 5.0% 21,600 60.0%2010 46,935,900 17,537,200 3,182,800 20,073,100 19,753,113 107,482,113 1.1% 1,177,704 108,659,817 2,328,800 5,718,983 114,378,800 5.0% 21,800 60.0%2011 47,655,900 17,761,000 3,250,100 20,375,700 19,731,825 108,774,525 1.2% 958,704 109,733,229 2,363,900 5,775,471 115,508,700 5.0% 22,000 60.0%2012 48,367,700 17,984,700 3,313,300 20,577,500 19,710,751 109,953,951 1.1% 958,704 110,912,655 2,387,300 5,837,545 116,750,200 5.0% 22,200 60.0%2013 49,070,900 18,180,500 3,372,200 20,779,200 18,835,042 110,237,842 0.3% 1,192,848 111,430,690 2,410,700 5,864,810 117,295,500 5.0% 22,300 60.0%2014 49,751,600 18,376,300 3,426,900 20,880,100 18,814,387 111,249,287 0.9% 1,192,848 112,442,135 2,422,400 5,917,965 118,360,100 5.0% 22,500 60.0%2015 50,459,700 18,544,100 3,481,700 21,081,800 18,793,938 112,361,238 1.0% 1,192,848 113,554,086 2,445,800 5,976,514 119,530,600 5.0% 22,700 60.0%2016 50,710,900 18,711,900 3,532,200 21,182,700 18,773,693 112,911,393 0.5% 1,192,848 114,104,241 2,457,500 6,005,459 120,109,700 5.0% 22,900 60.0%2017 50,948,900 18,879,800 3,578,500 21,283,600 18,753,651 113,444,451 0.5% 1,192,848 114,637,299 2,469,200 6,033,501 120,670,800 5.0% 23,000 60.0%2018 51,173,900 19,047,600 3,624,800 21,384,400 18,733,810 113,964,510 0.5% 1,192,848 115,157,358 2,480,900 6,060,942 121,218,300 5.0% 23,100 60.0%2019 51,385,500 19,187,400 3,666,900 21,485,300 17,859,323 113,584,423 -0.3% 1,426,992 115,011,415 2,492,600 6,053,185 121,064,600 5.0% 23,000 60.0%2020 51,583,900 19,327,300 3,709,000 21,586,200 17,839,876 114,046,276 0.4% 1,426,992 115,473,268 2,504,300 6,077,532 121,550,800 5.0% 23,100 60.0%2021 51,731,200 19,467,100 3,746,900 21,687,100 17,820,624 114,452,924 0.4% 1,426,992 115,879,916 2,516,000 6,098,984 121,978,900 5.0% 23,200 60.0%2022 51,864,900 19,607,000 3,784,800 21,687,100 17,801,564 114,745,364 0.3% 1,426,992 116,172,356 2,516,000 6,114,344 122,286,700 5.0% 23,300 60.0%2023 51,998,800 19,718,900 3,818,500 21,787,900 17,782,695 115,106,795 0.3% 1,426,992 116,533,787 2,527,700 6,133,313 122,667,100 5.0% 23,300 60.0%2024 52,119,100 19,830,700 3,852,200 21,888,800 17,764,014 115,454,814 0.3% 1,426,992 116,881,806 2,539,400 6,151,694 123,033,500 5.0% 23,400 60.0%2025 52,225,700 19,942,600 3,881,600 21,888,800 17,745,521 115,684,221 0.2% 1,426,992 117,111,213 2,539,400 6,163,787 123,275,000 5.0% 23,500 60.0%2026 52,332,500 20,054,500 3,911,100 21,888,800 17,727,212 115,914,112 0.2% 1,426,992 117,341,104 2,539,400 6,175,896 123,517,000 5.0% 23,500 60.0%2027 52,425,600 20,138,400 3,940,600 21,989,700 17,709,086 116,203,386 0.2% 1,426,992 117,630,378 2,551,100 6,191,122 123,821,500 5.0% 23,600 60.0%2028 52,505,000 20,222,300 3,965,800 21,989,700 17,691,142 116,373,942 0.1% 1,426,992 117,800,934 2,551,100 6,200,066 124,001,000 5.0% 23,600 60.0%2029 52,584,500 20,306,200 3,991,100 21,989,700 17,673,377 116,544,877 0.1% 1,426,992 117,971,869 2,551,100 6,209,031 124,180,900 5.0% 23,600 60.0%Compound Annual Growth Rates (Unless Marked Average): AverageAverage2008-2010 0.6% -0.2% -7.0% 3.0% -2.3% 0.1% 0.1% -20.2% -0.2% 3.0% 43.8% 1.1% 4.2% 0.9% 0.0%2010-2015 1.5% 1.1% 1.8% 1.0% -1.0% 0.9% 0.9% 0.3% 0.9% 1.0% 0.9% 0.9% 5.0% 0.8% 0.0%2015-2020 0.4% 0.8% 1.3% 0.5% -1.0% 0.3% 0.3% 3.6% 0.3% 0.5% 0.3% 0.3% 5.0% 0.3% 0.0%2020-2029 0.2% 0.6% 0.8% 0.2% -0.1% 0.2% 0.3% 0.0% 0.2% 0.2% 0.2% 0.2% 5.0% 0.2% 0.0%2008-2029 0.6% 0.7% 0.4% 0.7% -0.7% 0.4% 0.4% -1.2% 0.4% 0.7% 3.9% 0.5% 5.0% 0.3% 0.2%D.Hittle and Associates Page 3 of 49/12/2008 Table 10City and Borough of Sitka2008 Electric Load ForecastForecasted Energy Sales, Total Requirements, Losses and Peak Demand(kilowatt-hours)HIGH ELECTRIC VEHICLE CASEFiscal Year Residential Commercial BoatsPublic Authority Large Loads Total RetailAnnual % ChangeSMC (less Silver Bay Seafoods)Electric Vehicles Total Sales LossesTotal Requirements Loss %Peak Demand (kW)Load Factor2008 (Act) 46,396,181 17,617,210 3,682,664 18,921,972 20,688,080 107,306,107 1,848,337 - 109,154,444 2,765,003 111,919,447 2.5% 22,240 57.7%2009 48,515,000 18,234,200 3,787,100 20,989,600 20,629,460 112,155,360 4.5% 2,038,560 - 114,193,920 7,938,580 122,132,500 6.5% 24,500 57.0%2010 50,705,600 18,870,000 3,895,500 22,280,600 20,629,460 116,381,160 3.8% 3,133,560 47,000 119,561,720 8,311,780 127,873,500 6.5% 25,600 57.0%2011 52,500,200 19,301,100 4,000,200 22,948,400 20,629,460 119,379,360 2.6% 3,190,500 193,000 122,762,860 8,534,340 131,297,200 6.5% 27,800 54.0%2012 54,350,500 19,737,000 4,106,200 23,402,100 20,629,460 122,225,260 2.4% 3,247,440 483,000 125,955,700 8,756,300 134,712,000 6.5% 28,500 54.0%2013 56,241,900 20,184,200 4,208,400 23,864,400 20,629,460 125,128,360 2.4% 3,304,380 964,000 129,396,740 8,995,460 138,392,200 6.5% 29,300 54.0%2014 58,189,300 20,605,200 4,311,700 24,333,400 20,629,460 128,069,060 2.4% 3,361,320 1,388,000 132,818,380 9,233,320 142,051,700 6.5% 30,000 54.0%2015 60,177,600 21,030,500 4,416,300 24,809,000 20,629,460 131,062,860 2.3% 3,418,260 1,850,000 136,331,120 9,477,580 145,808,700 6.5% 30,800 54.0%2016 60,587,900 21,466,900 4,516,700 25,291,400 20,629,460 132,492,360 1.1% 3,448,920 2,311,000 138,252,280 9,611,120 147,863,400 6.5% 32,500 52.0%2017 60,983,200 21,907,800 4,618,200 25,780,700 20,629,460 133,919,360 1.1% 3,479,580 2,767,000 140,165,940 9,744,160 149,910,100 6.5% 32,900 52.0%2018 61,379,200 22,353,100 4,720,800 26,276,800 20,629,460 135,359,360 1.1% 3,510,240 3,223,000 142,092,600 9,878,100 151,970,700 6.5% 33,400 52.0%2019 61,776,000 22,770,100 4,819,100 26,779,900 20,629,460 136,774,560 1.0% 3,540,900 3,548,000 143,863,460 10,001,240 153,864,700 6.5% 33,800 52.0%2020 62,157,600 23,198,000 4,918,300 27,170,300 20,629,460 138,073,660 0.9% 3,571,560 3,984,000 145,629,220 10,123,980 155,753,200 6.5% 34,200 52.0%2021 62,501,000 23,629,800 5,022,000 27,688,500 20,629,460 139,470,760 1.0% 3,602,220 4,418,000 147,490,980 10,253,420 157,744,400 6.5% 34,600 52.0%2022 62,844,700 24,065,600 5,126,800 28,213,800 20,629,460 140,880,360 1.0% 3,632,880 4,845,000 149,358,240 10,383,160 159,741,400 6.5% 35,100 52.0%2023 63,188,900 24,512,500 5,232,600 28,620,800 20,629,460 142,184,260 0.9% 3,663,540 5,272,000 151,119,800 10,505,700 161,625,500 6.5% 35,500 52.0%2024 63,517,300 24,929,000 5,339,500 29,161,700 20,629,460 143,576,960 1.0% 3,694,200 5,521,000 152,792,160 10,621,940 163,414,100 6.5% 35,900 52.0%2025 63,846,100 25,349,000 5,441,700 29,581,900 20,629,460 144,848,160 0.9% 3,724,860 5,929,000 154,502,020 10,740,780 165,242,800 6.5% 36,300 52.0%2026 64,175,300 25,779,600 5,544,800 30,136,200 20,629,460 146,265,360 1.0% 3,755,520 6,336,000 156,356,880 10,869,720 167,226,600 6.5% 36,700 52.0%2027 64,504,800 26,213,800 5,648,900 30,567,400 20,629,460 147,564,360 0.9% 3,786,180 6,324,000 157,674,540 10,961,360 168,635,900 6.5% 37,000 52.0%2028 64,818,600 26,658,800 5,748,000 31,137,800 20,629,460 148,992,660 1.0% 3,816,840 6,313,000 159,122,500 11,062,000 170,184,500 6.5% 37,400 52.0%2029 65,132,700 27,107,500 5,847,900 31,582,600 20,629,460 150,300,160 0.9% 3,847,500 6,129,000 160,276,660 11,142,240 171,418,900 6.5% 37,600 52.0%Compound Annual Growth Rates (Unless Marked Average): AverageAverage2008-2010 4.5% 3.5% 2.8% 8.5% -0.1% 4.1% 4.1% 30.2% 4.7% 73.4% 6.9% 5.2% 6.5% -2.7%2010-2015 3.5% 2.2% 2.5% 2.2% 0.0% 2.4% 2.4% 1.8% 108.5% 2.7% 2.7% 2.7% 6.5% 3.2% -0.8%2015-2020 0.6% 2.0% 2.2% 1.8% 0.0% 1.0% 1.0% 0.9% 16.6% 1.3% 1.3% 1.3% 6.5% 1.3% 0.0%2020-2029 0.5% 1.7% 1.9% 1.7% 0.0% 0.9% 0.9% 0.8% 4.9% 1.1% 1.1% 1.1% 6.5% 1.1% 0.0%2008-2029 1.6% 2.1% 2.2% 2.5% 0.0% 1.6% 1.6% 3.6% 1.8% 6.9% 2.1% 6.5% 2.5% -0.5%D.Hittle and Associates Page 4 of 49/12/2008 Table 11City and Borough of Sitka2008 Electric Load ForecastAssumed Residential Electric Heat Customers and Net Use per CustomerMEDIUM SCENARIOEstimatedExistingTotal Est.Total Res Heat New Heat % Res HeatAnnualCustomers Customers Customers Customers Heat Non-Heat Heat Non-Heat Total KWh/Cust2007 3,621 1,250 - 35% 12,000 8,400 15,000 30,416 45,416 12,543 2008 3,645 1,250 90 34% 12,000 8,400 16,080 30,618 46,698 12,812 2009 3,669 1,340 150 37% 12,000 8,400 17,880 30,820 48,700 13,273 2010 3,692 1,490 150 40% 12,000 8,400 19,680 31,013 50,693 13,730 2011 3,713 1,640 150 44% 12,000 8,400 21,480 31,189 52,669 14,185 2012 3,733 1,790 50 48% 12,000 8,400 22,080 31,357 53,437 14,315 2013 3,752 1,840 50 49% 12,000 8,400 22,680 31,517 54,197 14,445 2014 3,770 1,890 18 50% 12,000 8,400 22,896 31,668 54,564 14,473 2015 3,787 1,908 17 50% 12,000 8,400 23,100 31,811 54,911 14,500 2016 3,803 1,925 16 51% 12,000 8,400 23,292 31,945 55,237 14,525 2017 3,818 1,941 15 51% 12,000 8,400 23,472 32,071 55,543 14,548 2018 3,832 1,956 14 51% 12,000 8,400 23,640 32,189 55,829 14,569 2019 3,845 1,970 13 51% 12,000 8,400 23,796 32,298 56,094 14,589 2020 3,857 1,983 12 51% 12,000 8,400 23,940 32,399 56,339 14,607 2021 3,868 1,995 11 52% 12,000 8,400 24,072 32,491 56,563 14,623 2022 3,878 2,006 10 52% 12,000 8,400 24,192 32,575 56,767 14,638 2023 3,887 2,016 9 52% 12,000 8,400 24,300 32,651 56,951 14,652 2024 3,895 2,025 8 52% 12,000 8,400 24,396 32,718 57,114 14,663 2025 3,902 2,033 7 52% 12,000 8,400 24,480 32,777 57,257 14,674 2026 3,909 2,040 7 52% 12,000 8,400 24,564 32,836 57,400 14,684 2027 3,915 2,047 6 52% 12,000 8,400 24,636 32,886 57,522 14,693 2028 3,921 2,053 6 52% 12,000 8,400 24,708 32,936 57,644 14,701 Average Annual Increase2007-2010700 3.1%2010-20151.1%2015-20200.1%2020-20280.1%Annual kWh/Cust Estimated Annual Load (MWh)D. Hittle & Associates, Inc. Page 1 of 3 9/12/2008 Table 11City and Borough of Sitka2008 Electric Load ForecastAssumed Residential Electric Heat Customers and Net Use per CustomerHIGH SCENARIOEstimatedExistingTotal Est.Total Res Heat New Heat % Res HeatAnnualCustomers Customers Customers Customers Heat Non-Heat Heat Non-Heat Total KWh/Cust2007 3,621 1,250 - 35% 12,000 8,400 15,000 30,416 45,416 12,543 2008 3,645 1,250 90 34% 12,000 8,400 16,080 30,618 46,698 12,812 2009 3,669 1,340 200 37% 12,000 8,400 18,480 30,820 49,300 13,437 2010 3,692 1,540 200 42% 12,000 8,400 20,880 31,013 51,893 14,055 2011 3,713 1,740 200 47% 12,000 8,400 23,280 31,189 54,469 14,670 2012 3,733 1,940 200 52% 12,000 8,400 25,680 31,357 57,037 15,279 2013 3,752 2,140 200 57% 12,000 8,400 28,080 31,517 59,597 15,884 2014 3,770 2,340 100 62% 12,000 8,400 29,280 31,668 60,948 16,167 2015 3,787 2,440 17 64% 12,000 8,400 29,484 31,811 61,295 16,186 2016 3,803 2,457 16 65% 12,000 8,400 29,676 31,945 61,621 16,203 2017 3,818 2,473 15 65% 12,000 8,400 29,856 32,071 61,927 16,220 2018 3,832 2,488 14 65% 12,000 8,400 30,024 32,189 62,213 16,235 2019 3,845 2,502 13 65% 12,000 8,400 30,180 32,298 62,478 16,249 2020 3,857 2,515 12 65% 12,000 8,400 30,324 32,399 62,723 16,262 2021 3,868 2,527 11 65% 12,000 8,400 30,456 32,491 62,947 16,274 2022 3,878 2,538 10 65% 12,000 8,400 30,576 32,575 63,151 16,284 2023 3,887 2,548 9 66% 12,000 8,400 30,684 32,651 63,335 16,294 2024 3,895 2,557 8 66% 12,000 8,400 30,780 32,718 63,498 16,302 2025 3,902 2,565 7 66% 12,000 8,400 30,864 32,777 63,641 16,310 2026 3,909 2,572 7 66% 12,000 8,400 30,948 32,836 63,784 16,317 2027 3,915 2,579 6 66% 12,000 8,400 31,020 32,886 63,906 16,323 2028 3,921 2,585 6 66% 12,000 8,400 31,092 32,936 64,028 16,330 Average Annual Increase2007-20103.9%2010-20152.9%2015-20250.1%2020-20280.1%Annual kWh/Cust Estimated Annual Load (MWh)D. Hittle & Associates, Inc. Page 2 of 3 9/12/2008 Table 11City and Borough of Sitka2008 Electric Load ForecastAssumed Residential Electric Heat Customers and Net Use per CustomerLOW SCENARIOEstimatedExistingTotal Est.Total Res Heat New Heat % Res HeatAnnualCustomers Customers Customers Customers Heat Non-Heat Heat Non-Heat Total KWh/Cust2007 3,621 1,250 - 35% 12,000 8,400 15,000 30,416 45,416 12,543 2008 3,645 1,250 90 34% 12,000 8,400 16,080 30,618 46,698 12,812 2009 3,669 1,340 50 37% 12,000 8,400 16,680 30,820 47,500 12,946 2010 3,692 1,390 50 38% 12,000 8,400 17,280 31,013 48,293 13,080 2011 3,713 1,440 50 39% 12,000 8,400 17,880 31,189 49,069 13,216 2012 3,733 1,490 50 40% 12,000 8,400 18,480 31,357 49,837 13,350 2013 3,752 1,540 50 41% 12,000 8,400 19,080 31,517 50,597 13,485 2014 3,770 1,590 50 42% 12,000 8,400 19,680 31,668 51,348 13,620 2015 3,787 1,640 50 43% 12,000 8,400 20,280 31,811 52,091 13,755 2016 3,803 1,690 16 44% 12,000 8,400 20,472 31,945 52,417 13,783 2017 3,818 1,706 15 45% 12,000 8,400 20,652 32,071 52,723 13,809 2018 3,832 1,721 14 45% 12,000 8,400 20,820 32,189 53,009 13,833 2019 3,845 1,735 13 45% 12,000 8,400 20,976 32,298 53,274 13,855 2020 3,857 1,748 12 45% 12,000 8,400 21,120 32,399 53,519 13,876 2021 3,868 1,760 11 46% 12,000 8,400 21,252 32,491 53,743 13,894 2022 3,878 1,771 10 46% 12,000 8,400 21,372 32,575 53,947 13,911 2023 3,887 1,781 9 46% 12,000 8,400 21,480 32,651 54,131 13,926 2024 3,895 1,790 8 46% 12,000 8,400 21,576 32,718 54,294 13,939 2025 3,902 1,798 7 46% 12,000 8,400 21,660 32,777 54,437 13,951 2026 3,909 1,805 7 46% 12,000 8,400 21,744 32,836 54,580 13,963 2027 3,915 1,812 6 46% 12,000 8,400 21,816 32,886 54,702 13,972 2028 3,921 1,818 6 46% 12,000 8,400 21,888 32,936 54,824 13,982 Average Annual Increase2007-20101.4%2010-20151.0%2015-20250.2%2020-20280.1%Annual kWh/Cust Estimated Annual Load (MWh)D. Hittle & Associates, Inc. Page 3 of 3 9/12/2008 Table 12City and Borough of Sitka2008 Electric Load ForecastEstimated Interruptible Energy SalesFiscalMedium High Low Medium High LowYear Muni. Heat Industrial Total Low Water Average High Water Retail Loads Retail Loads Retail Loads Retail Loads Retail Loads Retail Loads2007 - - - 85,000,000 124,000,000 135,000,000 - - - - - - 2008 - 4,380,000 4,380,000 85,000,000 124,000,000 135,000,000 4,380,000 1,867,500 4,380,000 4,380,000 4,380,000 4,380,000 2009 - 4,380,000 4,380,000 85,000,000 124,000,000 135,000,000 1,267,700 - 4,380,000 4,380,000 4,380,000 4,380,000 2010 - 10,950,000 10,950,000 85,000,000 124,000,000 135,000,000 - - 8,491,300 10,334,700 3,909,200 10,950,000 2011 - 10,950,000 10,950,000 85,000,000 124,000,000 135,000,000 - - 7,249,800 8,640,500 804,600 10,950,000 2012 - 10,950,000 10,950,000 85,000,000 124,000,000 135,000,000 - - 6,704,500 6,946,000 - 10,950,000 2013 - 37,230,000 37,230,000 85,000,000 124,000,000 135,000,000 - - 5,639,900 5,286,200 - 16,639,900 2014 - 37,230,000 37,230,000 85,000,000 124,000,000 135,000,000 - - 4,469,400 3,588,100 - 15,469,400 2015 - 37,230,000 37,230,000 85,000,000 140,000,000 160,000,000 7,575,000 - 19,890,300 27,575,000 14,608,300 37,230,000 2016 - 52,560,000 52,560,000 85,000,000 140,000,000 160,000,000 6,457,200 - 19,329,200 26,457,200 13,049,300 39,329,200 2017 - 52,560,000 52,560,000 85,000,000 159,000,000 175,000,000 24,502,200 10,476,400 37,781,700 40,502,200 26,476,400 52,560,000 2018 - 52,560,000 52,560,000 85,000,000 159,000,000 175,000,000 23,555,600 8,930,000 37,935,400 39,555,600 24,930,000 52,560,000 2019 - 52,560,000 52,560,000 85,000,000 159,000,000 175,000,000 22,620,200 7,507,800 37,449,200 38,620,200 23,507,800 52,560,000 2020 - 52,560,000 52,560,000 85,000,000 159,000,000 175,000,000 21,734,200 5,980,800 37,021,100 37,734,200 21,980,800 52,560,000 2021 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 2022 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 2023 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 2024 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 2025 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 2026 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 2027 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 2028 - 52,560,000 52,560,000 85,000,000 265,000,000 281,000,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 52,560,000 Compound Annual Growth Rates (Unless Marked Average):2008-2010 58.1% 58.1%2010-2015 27.7% 27.7%2015-2020 7.1% 7.1%2020-2028 0.0% 0.0%Projected Interruptible Base Load (kWh) Hydroelectric Generation Capability (kWh)Potential Interruptible Sales - Average Water Potential Interruptible Sales - High WaterD. Hittle & Associates9/12/2008 Table 12A City and Borough of Sitka 2008 Electric Load Forecast Assumed New Interruptible Loads Load Annual Estimated Sequence Building / Facility kW factor kWh On-Line 1 Blatchley Middle School / Pool 1,000 50% 4,380,000 2007 2 Sitka High School 1,500 50% 6,570,000 2009 3 Future K School 500 50% 2,190,000 2012 4 Baranof School 500 50% 2,190,000 2012 5 Search Hospital 1,500 50% 6,570,000 2012 6 Sitka Hospital 1,500 50% 6,570,000 2012 7 Mt. Edgecumbe 2,000 50% 8,760,000 2012 8 Pioneer Home 1,500 50% 6,570,000 2015 9 Coast Guard 1,000 50% 4,380,000 2015 10 Other Public Buildings 1,000 50% 4,380,000 2015 D. Hittle & Associates 9/12/2008 Table 13 City and Borough of Sitka 2008 Electric Load Forecast Estimated Electric Vehicle Loads Estimated Number of Passenger Cars Percent Electric Cars Estimated Number of Electric Cars Annual Miles per Electric Car Average Electricity Consumption (miles/kWh) Annual Vehicle Space Heat (kWh/car) Total Annual Electric Car Load (kWh) 2008 4,860 0.0% - 4,380 5.00 1,095 - 2009 4,878 0.5% 24 4,380 5.00 1,095 47,304 2010 4,896 2.0% 98 4,380 5.00 1,095 193,158 2011 4,894 5.0% 245 4,380 5.00 1,095 482,895 2012 4,892 10.0% 489 4,380 5.00 1,095 963,819 2013 4,890 15.0% 734 4,380 5.50 1,095 1,388,261 2014 4,888 20.0% 978 4,380 5.50 1,095 1,849,754 2015 4,886 25.0% 1,222 4,380 5.50 1,095 2,311,246 2016 4,877 30.0% 1,463 4,380 5.50 1,095 2,767,065 2017 4,868 35.0% 1,704 4,380 5.50 1,095 3,222,884 2018 4,859 40.0% 1,944 4,380 6.00 1,095 3,547,800 2019 4,850 45.0% 2,183 4,380 6.00 1,095 3,983,975 2020 4,841 50.0% 2,421 4,380 6.00 1,095 4,418,325 2021 4,828 55.0% 2,655 4,380 6.00 1,095 4,845,375 2022 4,815 60.0% 2,889 4,380 6.00 1,095 5,272,425 2023 4,802 65.0% 3,121 4,380 6.50 1,095 5,520,569 2024 4,789 70.0% 3,352 4,380 6.50 1,095 5,929,172 2025 4,776 75.0% 3,582 4,380 6.50 1,095 6,336,007 2026 4,767 75.0% 3,575 4,380 6.50 1,095 6,323,625 2027 4,758 75.0% 3,569 4,380 6.50 1,095 6,313,012 2028 4,749 75.0% 3,562 4,380 7.00 1,095 6,129,184 Average Vehicle Daily Use (miles) 12 Vehicle Heater (Watts) 1,500 Average daily heating hours 2 D. Hittle & Associates 9/12/2008 Table 14City and Borough of Sitka2008 Electric Load ForecastProjected Large Customer Loads(kWh)Medium and High Growth ScenariosSitka Sound SeafoodSeafood Producer's CoopSEARHC HospitalSitka Community HospitalCity of Sitka Cold StorageSeamart GroceryLakeside GrocerySilver Bay SeafoodsUS Coast Guard Blatchley High School Auditorium Total2008 (Act.) 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2009 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2010 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2011 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2012 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2013 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2014 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2015 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2016 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2017 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2018 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2019 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2020 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2021 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2022 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2023 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2024 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2025 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2026 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2027 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2028 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 2029 3,633,000 2,574,000 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,341,440 1,727,200 1,124,400 881,760 360,000 20,629,460 D. Hittle & Associates, Inc. Page 1 of 2 9/12/2008 Table 14City and Borough of Sitka2008 Electric Load ForecastProjected Large Customer Loads(kWh)Low Growth ScenarioSitka Sound SeafoodSeafood Producer's CoopSEARHC HospitalSitka Community HospitalCity of Sitka Cold StorageSeamart GroceryLakeside GrocerySilver Bay SeafoodsUS Coast Guard Blatchley High School Auditorium Total2008 (Act.) 3,269,700 2,316,600 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,107,296 1,727,200 1,124,400 881,760 360,000 19,774,616 2009 3,269,700 2,316,600 2,150,280 1,231,500 1,126,080 1,892,400 1,587,400 2,107,296 1,727,200 1,124,400 881,760 360,000 19,774,616 2010 3,269,700 2,316,600 2,128,777 1,231,500 1,126,080 1,892,400 1,587,400 2,107,296 1,727,200 1,124,400 881,760 360,000 19,753,113 2011 3,269,700 2,316,600 2,107,489 1,231,500 1,126,080 1,892,400 1,587,400 2,107,296 1,727,200 1,124,400 881,760 360,000 19,731,825 2012 3,269,700 2,316,600 2,086,415 1,231,500 1,126,080 1,892,400 1,587,400 2,107,296 1,727,200 1,124,400 881,760 360,000 19,710,751 2013 2,906,400 2,059,200 2,065,550 1,231,500 1,126,080 1,892,400 1,587,400 1,873,152 1,727,200 1,124,400 881,760 360,000 18,835,042 2014 2,906,400 2,059,200 2,044,895 1,231,500 1,126,080 1,892,400 1,587,400 1,873,152 1,727,200 1,124,400 881,760 360,000 18,814,387 2015 2,906,400 2,059,200 2,024,446 1,231,500 1,126,080 1,892,400 1,587,400 1,873,152 1,727,200 1,124,400 881,760 360,000 18,793,938 2016 2,906,400 2,059,200 2,004,201 1,231,500 1,126,080 1,892,400 1,587,400 1,873,152 1,727,200 1,124,400 881,760 360,000 18,773,693 2017 2,906,400 2,059,200 1,984,159 1,231,500 1,126,080 1,892,400 1,587,400 1,873,152 1,727,200 1,124,400 881,760 360,000 18,753,651 2018 2,906,400 2,059,200 1,964,318 1,231,500 1,126,080 1,892,400 1,587,400 1,873,152 1,727,200 1,124,400 881,760 360,000 18,733,810 2019 2,543,100 1,801,800 1,944,675 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,859,323 2020 2,543,100 1,801,800 1,925,228 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,839,876 2021 2,543,100 1,801,800 1,905,976 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,820,624 2022 2,543,100 1,801,800 1,886,916 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,801,564 2023 2,543,100 1,801,800 1,868,047 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,782,695 2024 2,543,100 1,801,800 1,849,366 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,764,014 2025 2,543,100 1,801,800 1,830,873 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,745,521 2026 2,543,100 1,801,800 1,812,564 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,727,212 2027 2,543,100 1,801,800 1,794,438 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,709,086 2028 2,543,100 1,801,800 1,776,494 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,691,142 2029 2,543,100 1,801,800 1,758,729 1,231,500 1,126,080 1,892,400 1,587,400 1,639,008 1,727,200 1,124,400 881,760 360,000 17,673,377 D. Hittle & Associates, Inc. Page 2 of 2 9/12/2008 CITY & BOROUGH OF SITKA ELECTRIC SYSTEM LOAD FORCAST vs. RESOURCE PROJECTION GRAPHS Reference Document: Grant Application, Tab 3: page 10 of 19 EEnneerrggyy RReeqquuiirreemmeenntt –– 22..11%% PPrroojjeecctteedd LLooaadd GGrroowwtthh –– HHiigghh GGrroowwtthh CCaassee - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000 220,000 240,000 260,000 280,000 300,000 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 YearEnergy in Megawatt-hrs+ FVU & PMFU Capacity Blue Lake Capacity + Green Lake Add 3rd Turbine at Blue Lake Raise dam 83 Ft to elev 425 And fill lake Historical Load Projected Load Load Low Rainfall Firm Energy Capability Average rainfall Avg Energy Capability Add Takatz Lake 2.1 % Load Growth EEnneerrggyy RReeqquuiirreemmeenntt –– 33..88 %% PPrroojjeecctteedd LLooaadd GGrroowwtthh –– AAvveerraaggee HHiissttoorriiccaall LLooaadd GGrroowwtthh ffrroomm 11997733--22000088 - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000 220,000 240,000 260,000 280,000 300,000 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 YearEnergy in Megawatt-hrs+ FVU & PMFU Blue Lake Capacity + Green Lake Add 3rd Turbine at Blue Lake Raise dam 83 Ft to elev 425 And fill lake Historical Load Projected Load Load Low Rainfall Firm Energy Capability Average rainfall Avg Energy Capability Add Takatz Lake 3.8% Load Growth - Historical 1973-2008 EEnneerrggyy RReeqquuiirreemmeenntt –– 55..00 %% PPrroojjeecctteedd LLooaadd GGrroowwtthh –– AAccttuuaall LLooaadd GGrroowwtthh FFYY22000077--22000099 - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000 220,000 240,000 260,000 280,000 300,000 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 YearEnergy in Megawatt-hrs+ FVU & PMFU Blue Lake Capacity + Green Lake Add 3rd Turbine at Blue Lake Raise dam 83 Ft to elev 425 And fill lake Historical Load Projected Load Load Low Rainfall Firm Energy Capability Average rainfall Avg Energy Capability Add Takatz Lake 5.0 % Load Growth CITY & BOROUGH OF SITKA SITKA ELECTRIC DEPARTMENT KEY PERSONNEL Reference Document: Grant Application, Tab 3: page 6 of 19 Key Sitka Electric Department Personnel September 2010 Christopher Brewton, Utility Director. Mr. Brewton has over ten years utility management experience in municipal and federal utilities in a variety of assignments. He holds a BSEET degree and is the former Electric Division Manager for Ketchikan Public Utilities in Ketchikan, Alaska. He retired from the U.S. Coast Guard in 1998 after serving twenty-five years and has since been employed as an Electrical Engineer and Manager, including five years with the City of Ketchikan. Dean Orbison, P.E., Generation Engineer. Mr. Orbison has over twenty-five years of industrial and electric utility engineering and management experience, all in Sitka. He served as a Project Engineer for the Alaska Pulp Mill for fifteen years. He holds a BSME degree and has been employed by the City of Sitka’s electric utility for over twelve years. Since 2002 he has been leading the effort to relicense and expand the Blue Lake Hydroelectric Project, which was issued a new thirty year license in March, 2008 by the Federal Energy Regulatory Commission. He is now managing the expansion of the Blue Lake Hydroelectric Project to its maximum capacity. Andrew Eggen, Generation System Manager. Mr. Eggen has over twenty-five years experience in electric utility engineering and management, all in Southeast Alaska. Mr. Eggen managed the Upper Lynn Canal electric system that serves Haines and Skagway for 15 years. He holds a BSME degree and has been employed by the City of Sitka’s electric utility for over five years. Robert E. Dryden, P.E. , System Engineer. Mr. Dryden has over thirty-five years of experience, all in Alaska, in power plant design and construction of diesel, turbine, and hydro; design and construction of transmission, distribution, and substations; switchgear and protective relaying, control and instrumentation systems; bulk fuel tank farm design and construction; and system planning and economic studies. He holds a BSEE degree and has been employed by the City of Sitka’s electric utility for over five years. David Hawkins, P.E., Transmission and Distribution System Manager. Mr. Hawkins has over twenty-five years of experience in electric utility distribution engineering and operations including electric system planning, distribution studies, design and construction. He holds a BSEE degree and has just begun work in Sitka after 15 years on the island of Pohnpei within the Federated States of Micronesia. CITY & BOROUGH OF SITKA SITKA ELECTRIC DEPARTMENT UTILITY DIRECTOR - RESUME Reference Document: Grant Application, Tab 3: page 6 of 19 CITY & BOROUGH OF SITKA SITKA ELECTRIC DEPARTMENT KEY CONSULTANTS Reference Document: Grant Application, Tab 3: page 6 of 19 Key Consultants to the Sitka Electric Department September 2010 Transmission and Distribution Engineering F. Michael Carson P.E., dba Northstar Power Engineering, Craig, Alaska. Mr. Carson has been Sitka’s primary transmission and distribution system consulting engineer for over ten years. Electric Power Systems, Anchorage and Juneau, Alaska David Buss, P.E., Juneau, Alaska has been Sitka’s primary relay and control system consultant for more than ten years. Additional technical support staff in Anchorage and Juneau is also periodically employed. System Planning and Load Forecasting John L. Heberling, P.E., Vice President, D Hittle & Associates, Inc. Mr. Heberling has many years experience in all areas of Alaska utility functions and has conducted resource planning and electrical load studies for Sitka since 2001. Supervisory Control and Data Acquisition System (SCADA) Tal Honadel, dba TS&H Automation Services, Eagle River, Alaska has been Sitka’s primary SCADA system consultant and programmer for over 15 years. Federal Energy Regulatory Commission (FERC) Licensing C. Mike Prewitt, Ph.D. , FERC Licensing Consultant, Seattle, Washington. Dr. Prewitt, a Fisheries Biologist and former FERC Executive, has in depth experience and knowledge of the FERC licensing process and regulations governing the development and operation of hydroelectric projects. He has been employed as the principal FERC licensing consultant for Sitka since 2002 and was instrumental in Sitka receiving a new 30 year license for its Blue Lake Hydroelectric Project in March, 2008. Archeological Investigations Paul Rushmore dba Paleo Logics has been the City’s archeological consultant for both the Blue Lake Relicensing and Blue Lake Expansion projects and has over 35 years experience. Key Consultants to the Sitka Electric Department Page 2 of 2 Fishery Biologist Karl Wolfe dba Wilderness Wolfe, Fisheries Biologist, Sitka Alaska. Mr. Wolfe has been Sitka’s primary Fisheries Consultant for over seven years. He conducted the fishery field work and studies required in the relicensing of the Blue Lake Hydroelectric Project. Wildlife Biologist Kent Bovee, B.S. Wildlife Resources. Mr. Bovee, Wildlife Specialist, Sitka, Alaska. Mr. Bovee has over ten years of fish and wildlife research experience with the Alaska Department of Fish and Game. Mr. Bovee has been Sitka’s primary Wildlife Consultant for four years. He conducted the wildlife surveys and prepared wildlife reports for the relicensing of the Blue Lake Hydroelectric Project. Hydroelectric Project Engineering Paul Carson, P.E., dba Currents Consulting, Seattle, Washington. Mr. Carson has over thirty years of world wide experience in the planning, design, and construction management of hydroelectric projects. He was involved with the development of Sitka’s Green Lake Hydroelectric Project and continues as an advisor to us on hydroelectric projects. Kim de Rubertis, P.E., Consulting Engineer, Cashmere, Washington. Mr. de Rubertis is a Geological Engineer with over 45 years of world wide experience related to water resources. He has conducted inspections of our hydroelectric projects for FERC and now serves as an advisor to us on our hydroelectric projects, particularly geotechnical issues. EES Consulting, Kirkland, Washington provides design and technical services on minor projects, such as designing an industrial water pump station at the tailrace of the Blue Lake Hydroelectric Project. Don Jarrett, P.E., Senior Mechanical Engineer and Project Manager Scott Mahnken, P.E., Senior Civil Engineer Hatch Acres dba Hatch Energy has been providing engineering services such as the structural analysis to determine the feasibility of raising the Blue Lake dam, along with surge tank sizing, and transient pressure analysis for the expansion of the Blue Lake Hydroelectric Project. Keith Moen, P.E., Hydraulic Engineer/Senior Project Mgr, Seattle, Washington Hans de Meel, P.E., Manager of Operations, Western USA, Seattle, Washington Dan Curtis, Senior Engineer, Niagara Falls, NY Allen L. Mee, PhD, Senior Structural Engineer, Niagara Falls, NY Carl O. Mannheim, P.E., Seattle, Washington John B. Codrington, P.E., Senior Electrical Engineer, Niagara Falls, NY FIGURE 1 – TAKATZ LAKE PROJECT VICINITY MAP Reference Document: Grant Application, Tab 3: page 3 of 19 Data use subject to license. @2006 DeLorme. Topo USA@6.0. ru,r'r,v delnrmc r:nm lJtl FIGURE 2 – TAKATZ LAKE PROJECT OVERVIEW Reference Document: Grant Application, Tab 3: page 3 of 19 Figure 2 - Takatz Lake Project Overview FIGURE 3 – TAKATZ LAKE WATERSHED AND LAND OWNERSHIP DESIGNATION Reference Document: Grant Application, Tab 3: page 10 of 19 FIGURE 4 – TAKATZ LAKE PROJECT ALTERNATIVE TRANSMISSION LINE ROUTING Reference Document: Grant Application, Tab 3: page 17 of 19 Figure 4. Takatz Lake Project Transmission Alternative and Terminology. Note: Overland Alternative is City’s Preferred Alternative AEA QUARTERLY PROGRESS AND FINANCIAL REPORTS TAKATZ LAKE HYDROELECTRIC FEASIBILITY STUDY Reference Document: Grant Application, Tab 3: page 13 of 19 Fourth Quarterly Progress Report Sitka Electric Department, Jul 2010 Progress Report Form 01-Jul-10 Grantee: City and Borough of Sitka Project Name: Takatz Lake Hydroelectric Feasibility Grant #: 2195418 Period of Report: April 1 - June 30, 2010 Project Activities Completed: Executed AEA Grant Amendment #1 increasing project funds by $637,450 on May 10, 2010. Completed logistics planning for summer study season to ensure safe and secure accommodations for extended field work. Received USFS Special Use Permit #SIT538 to conduct field studies with permit expiration date of December 31, 2011. Draft Scoping Document No. 2 was submitted to FERC and stakeholders on June 16, 2010 for review. Wildlife and aquatic resources study plans were issued to stakeholders on March 25, 2010. Conducted formal meeting in Juneau, Alaska with various stakeholders to review aquatic resource plan on May 13, 2010. The Draft Cultural Resources Study Plan was submitted to select individuals for review on June 17, 2010. Signed 3-year agreement with USGS for stream gages at Takatz Lake and USGS installed second stream gage on April 9, 2010. Completed new consultant contracts with Currents Consulting for engineering support, C. Mike Prewitt for FERC licensing consultation, and Wilderness Wolfe for fisheries and hydrologic field studies. Existing or Potential Problems: Federal funding for project is uncertain at this juncture. CBS continues to advocate at the Federal and State level for hydroelectric to be recognized as renewable energy and eligible for possible renewable energy funding. Fourth Quarterly Progress Report Sitka Electric Department, Jul 2010 FY2011 Renewable Energy Grant second tier funding for Takatz Lake vetoed by Governor. Activities Targeted for Next Reporting Period: Review comments from draft Scoping Document No. 2 and issue final Scoping Document No. 2. Complete additional LiDAR survey and mapping of alternative overland transmission corridor. Issue Vegetation and Botanical Study plan. Conduct preliminary field analysis of overland transmission route feasibility. Continue wildlife, hydrological and aquatic field studies. Grantee: Project: Period:Grant Number:2195418 Report ##4 A B C D = B +C E = A - D TOTAL GRANT BUDGET PRIOR EXPENDITURES EXPENDITURES THIS PERIOD TOTAL EXPENDITURES GRANT BALANCE By Task or Milestone Obtain FERC Preliminary Permit Research Historical Data Consult with Alaska DOT Obtain Necessary Permits 65,000.00$ 48,459.00$ 39,292.50$ 87,751.50$ (22,751.50)$ Conduct Environmental Studies 120,000.00$ 54,742.79 54,742.79$ 65,257.21$ Conduct Geotech Investigations 50,000.00$ -$ 50,000.00$ Begin Preliminary Design Work 75,000.00$ -$ 75,000.00$ Obtain Aerial Photography/Maps 25,000.00$ 46,034.00$ 46,034.00$ (21,034.00)$ 49,684.00$ -$ 49,684.00$ 100,000.00$ -$ 100,000.00$ Publish Final Feasibility Report 20,000.00$ -$ 20,000.00$ 514,684.00$ 71,909.49$ 143,634.29$ 215,543.78$ 299,140.22$ -$ -$ -$ -$ -$ -$ -$ 514,684.00$ 71,909.49$ 143,634.29$ 215,543.78$ 299,140.22$ 514,684.00$ 71,909.49$ 143,634.29$ 215,543.78$ 299,140.22$ By Fund Sources 514,684.00$ 71,909.49$ 143,634.29$ 215,543.78$ 299,140.22$ -$ -$ -$ -$ 514,684.00$ 71,909.49$ 143,634.29$ 215,543.78$ 299,140.22$ Form requires two original signatures. The person certifying must be different from the person preparing the report. One signature should be the authorized representative of the Grantee organization or highest ranking officer; the other should be the person who prepared the report. I certify to the best of my knowledge and belief the information above is correct and funds were spent in accordance with grant agreement terms and conditions. Certified By:Prepared By: Title: James E. Dinley, Administrator Title: Lesly Peters, Grant Acct Date: Equipment By Budget Categories Direct Labor and Benefits Certification Total Total Grantee Match - In-Kind Grantee Match - Cash Contractual Grant Funds Travel City and Borough of Sitka Takatz Lake Hydroelectric Feasibilty April 1 - June 30, 2010 27,015.49$ Total Install Steam Gages Complete Prelim. Eng/Envy. Studies Prepare Cost Estimates and Feasibility study Attachment 1 Financial Report/Request for Reimbursement Form Conduct Public Meeting Budget Summary Prepare Initial Consultation Document Consult with State and Federal resource agencies for study plan (17,015.49)$ 10,000.00$ 23,450.49$ 3,565.00$ Grantee: City & Borough of Sitka Project:Takatz Lake Hydroelectric Feasibility 1 Grant Number: A B ORIGINAL GRANT BUDGET REVISED GRANT BUDGET By Task or Milestone Obtain FERC Preliminary Permit Research Historical Data Consult with Alaska DOT&PF Obtain Necessary Permits 65,000.00$ 255,000.00$ Conduct Environmental Studies 120,000.00$ 448,768.00$ Conduct Geotech Investigations 50,000.00$ 73,000.00$ Begin Preliminary Design Work 75,000.00$ 112,134.00$ Obtain Aerial Photography/Maps 25,000.00$ 75,000.00$ 49,684.00$ 75,000.00$ 100,000.00$ 90,000.00$ Publish Final Feasibility Report 20,000.00$ 20,000.00$ 514,684.00$ 1,383,902.00$ -$ -$ -$ -$ -$ -$ By Fund Sources 514,684.00$ 1,152,134.00$ 231,768.00$ 231,768.00$ -$ 746,452.00$ 1,383,902.00$ Total Total Grantee Match - In-Kind Grantee Match - Cash Equipment Contractual Grant Funds Budget Summary 10,000.00$ Request for Budget Amendment Majority of work will be completed under previous tasks Amendment No. Install Stream Gauges Complete Prelim. Eng/Env. Studies Prepare Initial Consultation Document Consult with State and Federal resource agencies for study plan 235,000.00$ Conduct Public Meeting Travel Total By Budget Categories Direct Labor and Benefits Prepare Cost Estimates and Feasibility study Additional LiDAR work will be required to evaluate alternative transmission route Anticipate these tasks will be completed jointly and initial budget estimate was excessive C BUDGET AMENDMENT JUSTIFICATION Initial budget was insufficient to cover all tasks required for this milestone. USGS agreement signed for 3 year cost of $250,183 Initial budget was insufficient to cover all tasks required for this milestone. Geotechnical work will consist only of baseline records review with limited field work Feasibility level design will entail only rudimentary work 2195418 CITY & BOROUGH OF SITKA RESOLUTION NO. 2009-37 ESTABLISHING A RESOLUTION TO REDUCE GREENHOUSE GASES 25% BY 2020 Reference Document: Grant Application, Tab 3: page 15 of 19 Sponsors: Ozment/Cavanaugh CITY AND BOROUGH OF SITKA RESOLUTION NO.2OO9-3? A RESOLUTION TO REDUCE MUNICIPAL GREENHOUSE CASES 25O/OBY 2O2O AS RECOMMENDED BY THE CLIMATE ACTION PLAN TASK FORCE WHER.EAS, the City and Borough of Sitka has endorsed the U.S. Mayors Climate Protection Agreement arld its goal of meeting Kyoto Protocol greenhouse gas emission reduction targets; and WHEREAS, the United States Global Research Frograrn has concluded that the impacts of increased or continued levels of greenhouse gas emissions will be the most severe for Alaskan communities and a scientific panel convened by the City and Borough ofJuneau has concluded that these changes are already affecting Southeast Alaska; and W.IIEREAS, numerous scientists and economists have concluded that ambitious greenhouse gas emission reductions of 2O to 3O percent by 2O2O can and should be done to avoid the enormous costs to human societies that would ensue if emissions continue to rise; and WHEREAS, a 25o/" reduction level would be consistent with the Clobal Warming Solutions Act enacted by the state of California for the purpose of meeting Kyoto Protocol targets using current business as usual estimates; and qnfEREAS, City and Borough of Sitka Resolution 2008-19 directs a municipal Climate Action Plan Task Force to recommend greenhouse gas emission reduction measures that would achieve a specihc reduction target; and WHEREAS, local governments have a unique ability to address greenhouse gas emissions as many of the most effective initiatives originate in the actions of local governments; and WIIEREAS' Sitka's municipal operations generated 3,732 tons of greenhouse gases in the baseline year of 2OO3, including 2,98 I tons emitted through the use of heating oil for municipal buildings and another 550 tons from the municipal vehicle fleet; and WHEREAS, a reduction of 25o/o below 2O03 baseline levels would eliminate 933 tons of greenhouse gas emissions and reduce fuel consumption by over 84,0OO gallons, and create potential savings of uP to one quarter million dollars per ye€rr in fuel costs at three dollars per gallon. NOqf' THERtf'ORt AE IT RESOL\IED that the City and Borough of Sitka Assembly directs the Climate Action Plan Task Force to set a greenhouse gas emissions reduction target of 257o frorn the 20O3 Base Lcvel by 2020. PASSED, APPROVED, AI\ID ADOPTED bY lOth day of March, 2009. ATTEST: the Assembly of the City and Borough of Sitka, Alaska this een Ingman, MMC Municipal Clerk CITY & BOROUGH OF SITKA RESOLUTION NO. 2008-19 ESTABLISHING A CLIMATE ACTION PLAN TASK FORCE Reference Document: Grant Application, Tab 3: page 15 of 19 CITY AND BOROUGH OF SITKA RESOLUTION NO. 2OO8.T9 A RESOLUTION ESTABLISHING A CLINTATE ACTION PLAN TASK FORCE TO ADVISE THE ASSEMBLY ON METHODS TO PLAN FOR A}ID NIITIGATE THE IMPACTS OF CLIMATE CHANGE AND REDUCE THE EMISSION OF GREENHOUSE GASES WHEREAS, scientists and public policy experts generally agree that climate change will have profound impacts on the economy, infrastructure, finances, and future development of cities within the State of Alaska; and WHEREAS, Mayors and local govemments throughout the state and the nation are studying ways to predict and measure the impacts of climate change, plan for and mitigate those impacts, and reduce emissions of greenhouse gases, and WHEREAS, the Mayor and Sitka Assembly have endorsed the U.S. Mayor's Climate Protection Agreement in recognition that global warming may present serious challenges for the City in the future and wish to be proactive with respect to climate change in order to mitigate the impacts to Sitka's environment, economy and quality of life, and WHEREAS, parties to the U.S. Mayor's Climate Protection Agreement agreed to strive to reduce global warming emissions by inventorying local emissions, setting emissions reduction targets and creating an action plan; and WHEREAS, the Mayor and the Sitka Assembly have taken the first step by authorizing the emissions inventory; and WHEREAS, the Mayor and the Sitka Assembly recognize the willingness of citizens of the City and Borough of Sitka to volunteer their time to completing the further steps of setting emissions reduction targets and creating an action plan. NOW, THEREFORE BE IT RESOLVED, that the Sitka assembly hereby authorizes a Climate Action Plan Task Force, which shall be a special committee established under Sitka General Code 2.04.0404, and2.04.150C, and BE IT FURTHER RESOLVED, that the Task Force shall consist of at least 7 but no more than twelve diverse members appointed by the Assembly, which will attempt to Resolution No. 2008-19 Page2 ofT appoint those who have climate change concerns, such as representatives from various groups including the youth, science, business, construction, tribal government, utilities/energy, environmental, frshing, tourism, land use/management and economic developments sectors of the communify; and BE IT FURTHER RESOLVED, that the Task Force shall be responsible for studying and making recommendations to the Sitka Assembly on ways to plan for and mitigate the impacts of climate change on the Ciry and Borough of Sitka's economy, infrastructure and future development, and methods the Ciry and Borough of Sitka can employ to reduce the emission of greenhouse gases, and BE IT FURTHER RESOLVED, that the Task Force shall work closely with and provide periodic updates and draft work products for the Assembly. BE IT FURTHER RESOLVED, that the Task Force selection process be completed by July of 2008 if feasible and that the Task Force meetings begin in September of 2008. PASSED, APPROVED, AND ADOPTED by the Assembly of the City and Borough of Sitka, Alaska this 26 day of June, 2008. ATTEST: Colleen Pellett, MMC Municipal Clerk ASSEMBLY OF THE CITY & BOROUGH OF SITKA ESTABLISHING AS SIGNATORY TO THE ALASKA COASTAL COMMUNITIES GLOBAL CLIMATE CHANGE COMPACT Reference Document: Grant Application, Tab 3: page 15 of 19 Regular Assernbly Meeting Minutes March 24, 2009 Page 3 Executive Session Item G Alaska Coastal Communities Item H oRD.2009-50 Dove lsland Lodge owneri involving Dove lsland Lodge v. City and Borough of Sitka, which may have immediate adverse legal and financial consequences for the City and Borough of Sitka and involve mattens that are required by law to be confidential, and to invite the Municipal Administrator, Municipal Attorney, outside legal counsel and the Planning Director to attend. Motion PASSED on a 6-1 voice vote with Ozment opposed. The assembly was in Executive Session from 8:13 p.m. until 8:31 p.m. MOTION by Stein to come out of Executive Session. Motion PASSED on a unanimous voice vote. MOTION by Cavanaugh to accept the recommendation of Municipal Attorney Hiflhouse and reject the proposal submitted by Dove lsland Lodge. Motion PASSED on a 7-0 roll call vote. MOTION by Ozment to approve the City and Borough of Sitka being a signatory on the attached paper entifled ,.Alaska Coastal Communities Global Climate Change Compact." This item was postponed from the previous meeting to give assembly members more time to review sitka conservation employee and fisherman, paul olsen read statistics on fishing and stressed the importance of limiting our carbon emissions. He urged the assembly to sign-on supporting climate change legislation. cavanaugh asked what kind of restrictions thrs would impose. steinpointed out there is some concern that we are hitching ourselves to an organization that is more aggressive than maybe the Lntire community wants to be- crews wanted to know if olsen had talked to local fishermen and processors to get their input. olsen replied he had not, butwould be happy to Hackett inquired whether other communities have signed. According to crews, Homer did. ozment noted the main ooint is to make people more aware of what is happening to the oceans. Cavanaugh said the approach needs to be reasonable and supported bylocal fisherman and processors. stein wanted to have on recoid how the fish processors felt about the signing of this and how it would affectthem. Hackett noted sitka is a coastal community and is dependent onits resources. The Mayor sees this as signing on the merits of the compact as listed in the document. Motion PASSED on a 6-1 roll call vote with Crews opposed. MOTION by Cavanaugh to approve Ordinance 2009-50 on secondand final reading: Amending section 2.04.020 entifled Meetings of the sGC to changethe adjournment and start time for regular- scheduled meetings toallow for more efficient assembly meetings. Mayor read the Title and Purpose sections. Motion PASSED on a 7-0 roll cail vote. AIASKA COESTNT COMTVTUNITIES GIONNT CIUUETT CHANGE COMPACT ,{hsko bas morc mibs oJ coasilinc tban all tbe rest oJ tbe Unitcd States. Thc vast n',r,jorij oJ our statc's resi&nts ccU our coastal communitics bome. Tbese commanities gencrctc bi[lions in economic activity. From Medakade u Kaktovik, peoph bave lived clong Ahskc's tost codst Jor tbousands of yats and depended on rich biologi- ccl ocean reso*rca Jor suwivaL Today, the cuhutal idcrtity and swvival of Alaska s coastal communities still ilcpend on the ocean resosrces that support commercialfsbing tourism, re*eation ond subsistence. We, tbe uikrsigncd Ahskan local and regional gouerttncrrts and elected oficiak, erpress ow dcep concerrr abouthutnm-iniluccd fubal clitnmte chonge a*d occan acidifcation and issue a call to policymakers to tahe sttolzg aril imncdiate rction to prcvcnt catastrophic imputs from greenbouse gas emissiow. We recogniu the validity.' ol tlii folhwittg statcmcnts: l:;i:Glb!Fl dinterc cblggc i.cprcscnts onc of r:hc greatest threats of our cime. The Inrergovemmental Panel on l'Clim&a C.b;ug; (IPCC), the world's leading sciendfic body on this subject, has prescnted compelling evidencc : _of ilirnatg cbangc's dangcrous cffecrs and has recommendcd steps to avoid them. The IPCC has called on :r,n1tio'iiito.ciilleddy curteil greenhousc g;rs emissions to ensure el'rat acmospheric concentrarions peak no later *ii" ZOf S' rdd dedinc 8O percent by 2050, comparcd to 2000. The IPCC has conduded with 90 perccnr con6- dcncc drar tbdays diinate changes arc acributablc to human acanry,primarily Fom the burning of fossil fuels. Ocean acidjficadon is caused by increased carbon dioxide concentrations from rbc burning of fossil fucls and is acceler'ating. The daily uptalce of over 22 million cons of carbon dioxide inco the ocean is causing ocean acidiGcation and threatens many forms of marine life by decreasing rhe abiliry of cenain organisms to build their shells and skcleml srrucrures. Ocean acidificarion has rhe porenrial, wirhin decades, to severely affecr marine organisms, food webs, biodiversiry and fisheries. Global dimatc cha.Be and ocean acidifrcation threaten communiries in Alaska. Because high larirude regions of the earth are particularly vuinerable to *re impacts of global climate change, Alaska has been describcd as "ground zero" for climatc change. Coastal crosion, thawing pcrmafrost, and sprucc bark beede infestations are evidence of climate change in Alaska. In addition, ocean acidification chreatens the fisheries thar providc food,jobs, and culrural identiry to many Alaskans, particularly in coastal communiries. Alaskan coastal comrounities are important to the narion, and Alaska cao play a role in addressing climate change and ocean acidi6cation. Alaska produces more chan half of rhe seafood caught in che United Sraces. Alaska elso has pocenrial to mitigare climare change and ocean acidificarion, rhrough developmenc and exporr ofrenewable energy rechnologies rhac can be used throughout rhe dcveloping world. There are compelling economic arguments to act now. Posirive economic developnrent and diversificarion of Alaskat economy will be essociated with addressing c[mate change in the srare. Furshe rmore, che economic costs of inacrion will be far grcater rlran rhe costs associated wirh immediate acrion co reduce greenhouse gas emissions in line wirh IPCC recommendacions. 4. Page 1 of - 6. The United Stetes has rn obligation ge t-Lg a leadership role in addressingglobal dimate change. Wirh only 5 percent of $e world's popularion, che United States produces approrimately 25 percent of che world! annual greenhouse gas emissions. 7 , Fot the well-being of orrrent and fuare geaerations, loungrlirte eccion must $s t- lren ar all levels of governmeot and througbout society to address global climate change and ocea.o acidification. Given the seriousness of tlcse problems, policies and programs so reduce greenhouse gas emissions must conscirute a prioriry when allocacing government resources, Wc bcreby exprcss suppofi Jot the Jolbwing policies, actions end initiatives: l. At the nadonal level, immediacely enact climate legislarion rhat will reduce greenhouse gas emissions !o meer or exceed rhe gods recommendcd by rhe IPCC; eg.,80 percent rcducrion Rom 2000 lcvels by 2050. 2. Reengagc at the nadonal level in the internarional proccss of dcaling effecrively with global climate change. 3. At drc national and state levels, enact legisladon and fund iniciacives rlat will dramarically increase enerry cfficiency and the production of renewable energ),. 4. Udfizr a significant ponion of rhe procee& from narional ap-and-rrade legislarion, carbon rax, or ocher sources ro fund iniriacives in Alaska rhat will: . develop renewable enerSy resources . improve energy efficiency in buildings, ransportation, erc., in all sectors of rhe economy . increase public knowledge of issues relaced to greenhouse gas emissions r creace a skilled workforce for a new clcan-cnergy economy . help vulnerable communiries adapt to unavoidable climate-related impacrs r pror€ct or rebuild infrastrucrure rhat is rhrearened by dimate impacts . enhance research in che area ofocean acidification ' enhance research in che areas of energyefficienryandrenewablc energy. Wc further exprcss olar cottrrrlitrnent to:. L nerwork with other Alaskan coastal communiries on the issues of climare change and ocean acidiFcation; 2. encourage acrions wirhin our own communities ro mirigere climare change and ocea.n acidificacion and adapr ro unavoi&ble changes; 3. make wise and effective use of resources provided by rhe state and federal govemmencs for such accions; and 4. support comrnuniry eForts to educace rhe public on rhese issues. Sigrcforics: (ro be listed here and on addiriond pages) Alaska Coastal Communities Clobal Climate Change Compact, page 2 of _