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HomeMy WebLinkAboutKipnuk REF R3 Package Kipnuk Light and Power High Penetration Wind Diesel Power and Heat Kipnuk, AK Application for Renewable Energy Fund Grant Round 3 Alaska Energy Authority November 10, 2009 Table of Contents 1. Grant Application 2. Resumes 3. Cost Worksheet 4. Grant Budget Form 5. Resolutions 6. Supplemental Materials Grant Application Renewable Energy Fund Round 3 Grant Application AEA 10-015 Application Page 1 of 28 10/7/2009 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-III.html Grant Application Form GrantApp3.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 Costworksheet3 .doc Summary of Cost information that should be addressed by applicants in preparing their application. Grant Budget Form GrantBudget3.d oc 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 GrantBudgetInst ructions3.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 3 AEA10-015 Grant Application Page 2 of 28 10/7/2009 SECTION 1 – APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) Kipnuk Light Plant Type of Entity: Electric Utility Mailing Address c/o Sam Carl General Manager Kipnuk Light Plant P.O. Box 70 Kipnuk, Alaska Physical Address Kipnuk, Alaska Telephone 907-896- 5427 Fax 907-896-5022 Email scarlklp@gmail.com, scarlklp@yahoo.com 1.1 APPLICANT POINT OF CONTACT Name Sam Carl Title Utility Manager Mailing Address c/o Sam Carl General Manager Kipnuk Light Plant P.O. Box 70 Kipnuk, Alaska Telephone 907-896-5427 Fax 907-896-5022 Email scarlklp@gmail.com, scarlklp@yahoo.com 1.2 APPLICANT MINIMUM REQUIREMENTS Please check as appropriate. If you do not to meet the minimum applicant requirements, your application will be rejected. 1.2.1 As an Applicant, we are: (put an X in the appropriate box) X An electric utility holding a certificate of public convenience and necessity under AS 42.05, or An independent power producer in accordance with 3 AAC 107.695 (a) (1), or A local government, or A governmental entity (which includes tribal councils and housing authorities); Yes 1.2.2. Attached to this application is formal approval and endorsement for its project by its board of directors, executive management, or other governing authority. If the applicant is a collaborative grouping, a formal approval from each participant’s governing authority is necessary. (Indicate Yes or No in the box ) Yes 1.2.3. As an applicant, we have administrative and financial management systems and follow procurement standards that comply with the standards set forth in the grant agreement. Yes 1.2.4. If awarded the grant, we can comply with all terms and conditions of the attached grant form. (Any exceptions should be clearly noted and submitted with the application.) Yes 1.2.5 We intend to own and operate any project that may be constructed with grant funds for the benefit of the general public. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 3 of 28 10/7/2009 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) High Penetration Wind Diesel Power and Heat 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. Kipnuk, Alaska 2.3 PROJECT TYPE Put X in boxes as appropriate 2.3.1 Renewable Resource Type X Wind Biomass or Biofuels Hydro, including run of river Transmission of Renewable Energy Geothermal, including Heat Pumps Small Natural Gas Heat Recovery from existing sources Hydrokinetic Solar Storage of Renewable Other (Describe) 2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply) Reconnaissance X Design and Permitting Feasibility X Construction and Commissioning Conceptual Design 2.4 PROJECT DESCRIPTION Provide a brief one paragraph description of your proposed project. The proposed project is a village wind power and heating system for the community of Kipnuk, Alaska. The project will be owned and operated by the Kipnuk Light Plant and the community of Kipnuk, and includes the installation of 675 kW of wind generation capacity, using three Vestas V- 27 wind turbines, new wind diesel controls and switchgear, a Power store flywheel energy storage unit for grid stabilization and 30 thermal electric heating and energy storage devices distributed throughout the community. The wind power and heating system ties in with the power plant and power store module through the existing power distribution grid. The wind turbines and power store module will be mounted on pile foundations, on property provided by the community. The power store and control/switchgear modules will be placed near the diesel power plant The system is designed to produce, capture and meter excess wind energy separately from diesel generation. Thirty electric thermal heating stoves will be placed in residential homes and three-80 KW electric thermal boilers will be placed in community building. These storage units will be used to capture excess energy to lower heating costs. The Power store flywheel will provide the grid stability allowing the village energy system to accept any and all contributions from the wind turbines. This wind diesel system architecture enables ease of expansion by adding more wind turbines and more electric thermal storage devices Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 4 of 28 10/7/2009 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 benefits of the this project include: The wind energy will displace 119,000 gallons of fuel used to generate power and 22,000 gallons of heating fuel. The annually savings to the utility that can be passed onto the customers total $595,000 annually based on a $5.00/gallon (AEA conceptual design report) average price for fuel over the life of the project. The electric thermal storage devices will reduce residential heating costs in the affected homes by 40%. This represents residential fuel savings of over $100000 annually. Additional turbines and off peak stoves can increase the benefit in the future. The savings in heating costs are over $100,000 per year, based on $8.00/gallon home heating fuel price and a $.10/KWhr excess wind energy price. Beyond a reduction in fuel use, cheaper power and lower heating costs, additional benefits of the project include: - Increased local employment and training - Reduced reliance on the volatility of fuel prices - Reduced risk of fuel spills - Reduced local air pollution and contribution to climate change - Increased revenue to the utility company - Reduced PCE payments - Use of the smart grid to improve management of utility and improve efficiency of the utility - A new model in the state for a greener, more sustainable village 2.6 PROJECT BUDGET OVERVIEW Briefly discuss the amount of funds needed, the anticipated sources of funds, and the nature and source of other contributions to the project. The total project cost is $4,716,000. The Kipnuk Light Plant will contribute $1,200,000 in matching funds. Total request from the renewable energy fund is $3,516,000. 2.7 COST AND BENEFIT SUMARY Include a summary of grant request and your project’s total costs and benefits below. Grant Costs (Summary of funds requested) 2.7.1 Grant Funds Requested in this application. $ 3,947,236 2.7.2 Other Funds to be provided (Project match) $ 1,400,000 2.7.3 Total Grant Costs (sum of 2.7.1 and 2.7.2) $ 5,347,236 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) $ 5,347,236 2.7.5 Estimated Direct Financial Benefit (Savings) $ 701,360 annually 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.) $ Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 5 of 28 10/7/2009 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 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. Project Management Plan Project supervision: Chaninik Wind Group board of directors, and Kipnuk Light and Power Utility Board, Dennis Meiners and Ben May of Intelligent Energy Systems, will manage this project with a construction STG Inc. will provide project management assistance. The project management board will consist of the Kipnuk local utility board and the Board of Directors of the Chaninik Wind Group. The chief electrical engineer is: Albert Sakata, P.E. The project engineers are Albert Sakata, P.E. and Dale Letourneau Metering project manager: Doug Riffle: metering, monitoring and web based support tools, systems engineer Control and integration; power system stability: Gavin Bates of Powercorp, and through the Anchorage office. The wind turbines and power system have advanced remote diagnostics capability. These components can be monitored and controlled via phone modem or Ethernet connection without the need for special software, through the use of Anyview visualization software. Construction; Dave Meyers, STG Inc. Wind Turbine training and support is by wind turbines Halus Corporation and Adam Sueflow of Windmatics. 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.) Funding available summer 2010 Complete final designs and construction agreements Summer 2010 Procurement of Turbines and long lead time items begins Summer 2010 Spring Barge shipments Summer 2011, overwinter crane Construction of control and integration module, delivery winter 2011 Installation of Thermal storage, August 2011 Commissioning November, December 2011 Project support January-December 2012 Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 6 of 28 10/7/2009 3.3 Project Milestones Define key tasks and decision points in your project and a schedule for achieving them. The Milestones must also be included on your budget worksheet to demonstrate how you propose to manage the project cash flow. (See Section 2 of the RFA or the Budget Form.) Key milestones: Final design and Permitting: A conceptual project design has been completed and is based on similar types of project. All permitting agencies have been contacted and applied for. Site control and heat and metering sales agreements. Grant Award Procurement and Mobilization Construction Commissioning Support Closeout 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. Project Management Plan Project supervision: Chaninik Wind Group board of directors, and Kipnuk Light and Power Utility Board, Dennis Meiners and Ben May of Intelligent Energy Systems, will manage this project with a construction STG Inc. will provide project management assistance. The project management board will consist of the Kipnuk local utility board and the Board of Directors of the Chaninik Wind Group. The chief electrical engineer is: Albert Sakata, P.E. The project engineers are Albert Sakata, P.E. and Dale Letourneau Metering project manager: Doug Riffle: metering, monitoring and web based support tools, systems engineer Control and integration; power system stability: Gavin Bates of Powercorp, and through the Anchorage office. The wind turbines and power system have advanced remote diagnostics capability. These components can be monitored and controlled via phone modem or Ethernet connection without the need for special software, through the use of Anyview visualization software. Construction; Dave Meyers, STG Inc. Wind Turbine training and support is by wind turbines Halus Corporation and Adam Sueflow of Windmatics. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 7 of 28 10/7/2009 3.5 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. A full-time, qualified project manager will be monitoring this project. The project point of contact and the project manager will jointly submit periodic status reports. Additionally, weekly and monthly project coordination meetings will be held with the project team to track progress and address issues as they arise 3.6 Project Risk Discuss potential problems and how you would address them. There are inherent risks in any project involving construction, logistics, and unpredictable weather. These risks will be managed by implementing meticulous planning resources, with contingency built into the project schedule. The team of Intelligent Energy Systems and STG has experience managing the logistics of this project. Flywheels have yet to be used in Alaska, so there may be some perceived risk surrounding their implementation. This project has elected to use a flywheel system, the PowerStore, which has been successfully implemented in multiple locations, some very remote, in Australia, as well as in conjunction with wind resources on several islands in the Azores, managing unstable loads and fluctuating power sources. These systems have produced unprecedented levels of high penetration, and been tested to the utmost level of confidence. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 8 of 28 10/7/2009 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. Regional wind monitoring was placed in Kongiganak by the Alaska Energy Authority to collect data representative for the region. Kipnuk is 30 miles away, and not a tree or hill in sight.) This data was correlated with long term airport data by meteorologist, Ed McCarthy of WECTEC, to confirm the suitability of the resource. The results of the wind resource evaluation indicate an outstanding wind resource with an average wind speed of 7.78 m/s, and with the power distribution well suited for the capture of wind energy. The data was analyzed in the HOMER and Windographer software models to and compared with the power curves of various candidate wind turbines. The primary wind turbines examined were the Windmatic 17S, the 21 meter, Northwind 100 B model, the Vestas V-27 225 kW wind turbine and the Vestas V-47, 600 kW machine. The HOMER modeling optimized the installation to 3, V-27’s, and a Powerstore Flywheel module. 4.2 Existing Energy System 4.2.1 Basic configuration of Existing Energy System Briefly discuss the basic configuration of the existing energy system. Include information about the number, size, age, efficiency, and type of generation. The existing power plant has a potential power generation capacity of 635 kW from three diesel generator with individual capacities of 250 kW, 250 kW, and 135 kW. The average community load is 220 kW and peak load is 370 kW. The existing power generation facility has a heat recovery system providing heat to the Kugkaktlik Limited, Traditional Council and Power Plant Offices. The community has had to frequently ration power, and numerous times has had to purchase fuel locally in small amounts at retail prices of up to $8.00 per gallon to continue to generate power until the barge shipments arrive. The new power plant and bulk fuel storage facility is proposed for construction in 2008-9, is uncertain. The Wind Heat project could be constructed in conjunction with this project and fully integrated into the system. The new power plant will have a generation capacity of 1,200 kW of diesel generation. The generators will be sized to meet the current power needs of the community as projected for the next 10 years. Four generators with the following capacities of 370, 370, 230 and 230 kW are planned for installation in 2013. The generators will be integrated with an automated control system, which can optimize the selection of gensets. Investments were made in the installation of a new Cummins 350 kW genset was installed, and the AEA is in the process of installing a new Cat 3456, electronically fuel injected generator rated 457 kW. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 9 of 28 10/7/2009 Population data for Kipnuk show a constant population growth since 1990. The current population is 680. Data for the last 5 years showed a growth of 7% which has slowed to 1.5% annually. New facilities and new loads include: AVCP 25 single family dwellings, in next 10 years. ADOT, new airport facilities, 120 kW ANTHC, clinic, 50 kW Coastal Villages Regions Fund (CVRS) Fisheries Support Center potential fish plant. A new school, is planned, 2013, 75 kW Water and Sewer System, 2013, 75 kW It has been estimated that the Electric Load will grow from its 2008, 1,657,658 kWhrs, to 2,381,000 kWhrs in by 2015. In the early years any excess wind energy will be captured and stored to heat community buildings and residences. 4.2.2 Existing Energy Resources Used Briefly discuss your understanding of the existing energy resources. Include a b rief discussion of any impact the project may have on existing energy infrastructure and resources. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 10 of 28 10/7/2009 Fuel is delivered to Kipnuk via barge rwice a year, once in the Spring and again in the Fall. Due to limited bulk fuel storage capacity, Kipnuk Light Plant has nearly run out of fuel for the past two years. The viability of various sources of energy was assessed in the Kipnuk, Alaska Rural Power System Upgrade Conceptual Design Report 2007. “The report on page 11 states: It is assumed that upgrades to the community electrical power system incorporating supplemental wind energy, is a priority and will be conducted within the next ten years.” “ This report was conducted when fuel prices were below $2.00 per gallon delivered in bulk to the utility. Last year bulk fuel wholesale purchases were $4.26 per gallon. This translated to home heating fuel costs of $8.00 per gallon. Annual electrical load growth and step increases in demand were projected through 2017. Demand grows from a peak of 339 kW now to a projected 709 kW. The alternatives were narrowed to three; Increased diesel efficiency: The current fuel efficiency of the diesel generation plant can be increased from 10 kw/hr per gallon to 14 kWhrs per gallon. This would result in annual fuel savings of 50,000 gallons per year. Switching from #1 to #2 diesel fuel could save as much as 7,400 gallons per year. 4.2.3 Existing Energy Market Discuss existing energy use and its market. Discuss impacts your project may have on energy customers. Kipnuk is located on the west bank of the Kugkaktlik River in the Yukon-Kuskokwim Delta, 85 air miles southwest of Bethel. It lies four miles inland from the Bering Sea coast. The community is located in a marine climate. Precipitation averages 22 inches, with 43 inches of snowfall annually. Summer temperatures range from 41 to 57, winter temperatures are 6 to 24. Kipnuk is accessible only by air or by snow machine in winter, and boat in summer, for delivery of supplies. In a recent RUBA report, it was indicated that Kipnuk meets all Essential indicators, and almost all Sustainability indicators. Kipnuk relies on electricity to maintain home lighting, street lighting, telephone service, school service, clinic hours, and freezers to maintain a subsistence lifestyle. Reliable electricity is crucial to the residents of Kipnuk Heat: A survey was conducted of heating fuel usage of each residence. These results are being correlated with other records. This information indicates that on average, a typical residence in Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 11 of 28 10/7/2009 Kipnuk uses 766 gallons of heating fuel annually, leaving an estimated 136,000 gallons of heating fuel available for displacement with wind. Heating fuel represents the single greatest cost of maintaining a residence. Typical costs last year exceeded $ 6,000 per household. The availability of wind correlates well with heating needs. The ability to store this wind energy at night and when the loads are low, sell this wind energy for half the cost of heating fuel, store the wind energy for use when needed, can reduce average residential fuel costs by $3,000 annually per household. 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 High Penetration Wind Diesel Smart Grid It has been demonstrated that low penetration systems, ones in which the proportion of wind to diesel rarely exceed 30%, are not economical and construction costs are disproportionably high. More importantly, the high cost of home heating is easily 3 to 5 times the cost of electricity in rural Alaska, and soaring fuel costs are crippling communities. A primary object of this program is to reduce dependency on diesel fuel and to reducing all energy costs in order to stabilize the local economies. The proposed system fulfills these objectives, more cost effective energy, by reducing fuel used to generate electricity by over 40%, while reducing residential heating costs by 50% by using wind to displace 130,000 gallons of heating fuel. Additionally these benefits are returned to the utility in increased revenues and increased local employment. Additional benefits are returned to the state in lower PCE contributions. This proposed system provides an integrated village heat and power system which uses a smart grid and thermal energy storage devices in each home to capture and store at a significantly reduced cost, excess wind energy. The wind diesel system is stabilized through the use of a proven 500 kW Powerstore Flywheel energy storage device used to balance fluctuations in the load or wind turbine output. This wind diesel architecture is designed to incorporate more wind, while reducing diesel generation, other types of renewable energy such as residential wind turbines, or pv. Similarly the system can be expanded through the addition of thermal storage devices and plug in vehicles and real storage to each home. The metering and energy storage systems are a necessary component of the village energy system management system and is responsible for the capture and beneficial use of the wind. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 12 of 28 10/7/2009 The system includes: Three Vestas V-27 wind turbines on 32 meter tubular towers. These turbines are completely remanufactured, and have been successfully used in St. Paul Island since 1997, and are becoming more widely used across the state. The turbines towers will installed on pile foundations, A containerized switchgear, control and integration module, containing switchgear, controls and the PowerStore flywheel. Heat recovery will be through 520 kW of distributed thermal storage heaters will be placed in the community building, head start preschool, the clinic, the homes of 20 village elders. a smart metering system will enable the stoves on and off as excess wind becomes available. The three wind turbines with a rated output of 675 kilowatts are paired with multiple diesel engines, a flywheel gird stability device, and 200 residential energy storage, and 320 kW of commercial energy storage. The grid stability flywheel, regulates the voltage and frequency of the power system, while diesel generation is decreased and wind energy penetration is increased. The supervisory control system would monitor the electrical load demand and configures various system operating modes. As the wind comes up, which occurs frequently at night most of the winter, excess wind energy would be made available to customers at a reduced rate. . The supervisory control system would determine the amount of available wind energy, while optimizing power production and component output. The supervisory controller would signal the metering system to enable various devices for separate green energy sales and separately account for wind only and diesel only power sales. Thermal Storage Devices in each home would be enabled to capture excess wind energy when available and store it for heating use throughout the day or for several days. The ability of the storage devices to store wind generated electricity Below is a diagram of the proposed system. This diagram, contains three future elements, the addition of more wind turbines, solar panels, and distributed residential energy storage. These three components are shown only to indicate the extent of the system potential. The diagram indicates the future implementation of plug in vehicles for local transportation. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 13 of 28 10/7/2009 The project design offers a very simple and reliable wind diesel architecture, which can be expanded to achieve 50% fuel saving at the electric utility, and 50% of the fuel requirements of the community. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 14 of 28 10/7/2009 The control and communications relationships of the power system components. The design enables high wind penetration at all times, with the existing power system stabilized at low loa ds with the flywheel to support any changes in power requirements or loss of wind output, while decreasing diesel fuel usage. The remote heat recovery boiler will be placed at the school, to absorb a limited amount of excess wind energy, and the smart meter enabled thermal energy storage units in each of 20 residences will capture the remaining wind. In low winds, the diesel power system will operate in a high penetration mode, with the smallest genset on line or possibly turned off, and the available wind captured to displace fuel used to generate electricity. As wind speeds increase greater proportions of wind energy are captured as heat. Diesel Retrofit The main features of modular control and integration unit, is that it s designed to be connected to an existing power plant. In this instance the switchgear is integrated into the design to reduce future costs, and maximizing the use of the existing facility. New gensets can then be added into the old of new powerhouse as required, with a minimum of new cabling and modification. This design anticipates the installation of new generators sets, which can operate efficiently over a range of load conditions in parallel operation with the wind turbines. The control system and power electronics design would select the most efficient generator to always be on line. Wind Turbines:  Cost estimates for turbine installation were developed after geotechnical investigations and load analysis. Installation costs estimates were developed for several types of turbines. Gross annual estimated energy production for each turbine was arrived at through comparison of power curves and wind resource information using HOMER. The results are summarized in Table 4. A 20-year investment horizon and a 5% nominal interest rate were used for economic analysis. These are the same investment guidelines as proposed in the Alaska Rural Energy Plan, April 2004. Table 3 – Wind Turbine Assumptions Per-Turbine Costs Fuel Saving gallons Turbine Model Rated Power (kW) Hub Height (m) Lifetime (yr) Capital Replacement O&M Generation* equivalent gallons Vestas 0 225 32 20-25 $900,000 3,500,000 275,000 $ 450,000 $12,000 682,884 37453 3, V-27 675 32 20-25 $2,500,000 $ 1300000 $28,000 2,048,652 106,395 The Vestas V-27 Wind turbine is a three bladed, horizontal axis wind turbine which utilizes rotational speeds of 26 rpm and full pitch control. This allows the turbine to operate aerodynamically efficiently over a wide range of wind speeds. The Vestas V -27 is one of a handful of a very limited number of wind turbines in this size range, and is about the largest turbine that can be installed and serviced with locally available equipment. These turbines will be placed approximately 250 feet apart and located 1000 feet from the existing 12.47 kV transmission line. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 15 of 28 10/7/2009 Wind Diesel Integration and Balance of System: The existing plant control system senses the load an automatically dispatches the most efficient generator set or combination of sets to meet the load. Additions to the power system will need to be made to accommodate high wind penetrations. Basic Stabilization and Functionality The PowerStore consists of a flywheel, which is electrically coupled to the power system. The flywheel and power electronics interface combination by itself is capable of basic stabilization of both the voltage and frequency of the power system without any additional information from external sources. The PowerStore system achieves stabilization through sensing of the grid and step-less absorption and exportation of real power for frequency variation and reactive power for voltage support. The energy stored in the flywheel reduces cyclic loading and smoothes out short-term fluctuations as the electric load and wind turbine outputs no matter how rapidly they change. This level of stabilization translates into large savings due to the ability to operate smaller more fuel efficient generator sets, lower diesel set points, reduced spinning reserve and diesel maintenance. High Penetration Wind Systems The sub second response of the PowerStore is supplemented by the multisecond response of the diesel generators, and the pitching of the wind turbine blades contribute to system stability and increased wind harvest. Other system changes can occur on the minute time frames, in which diesel generators, and wind turbines can be reconfigured and loads in the community can be turned on and off. The integration of the power system increases the value of the available wind. Properly integrated advanced control capability decreases the contribution of the diesel generators and provides more opportunity to use the PowerStore to ride through fluctuations of the wind, and thus increase penetration. The integrated control system increases the value of all the components in the system. To enable the advanced features of grid stabilization for high wind penetration systems, and maximum utilization of wind energy, the PowerStore system must operate in a coordinated manner with the other major system components distributed throughout the grid. This is done through a network of distributed integrated controllers. These controllers are designed to interface with existing PowerStation controls and are typically mounted into existing control cabinets. These devices are communicate over the Ethernet and are most reliably connected via fiber optic cable. Each device is driven by advanced software applications, which allows each component in the system to recognize and coordinate its activities with the other co ntrollers on the system. The addition of an intelligent distributed network of component controllers which are linked by high speed communications is a key feature in achieving optimising wind energy capture, improving efficiency, and getting the full benefit of every component in the system. The controllers can be built into the automation controls of the power plant or can be provided as an overlay, that works with and existing system. Distributed Integrated Control Network The Distributed Integrated Control Network (DICN) expands the capabilities of the existing plant supervisory control and data acquisitions system (SCADA) through the network of standard Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 16 of 28 10/7/2009 commercial component controllers, which run sophisticated software to integrate increasing lev els of wind. In the wind diesel configuration, the power plant SCADA would trigger the various diesel generators to start and stop, issue power set points for each component in the power plant. The DICN would incorporate the setting and commands of the SCADA and configure the other components of the system based on the load and available wind energy. A DICN controller would be embedded in the Power store module, as well as the in the wind turbine and potentially diesel controllers. Thus the modular distributed control system controller can be used as a complete or supplementary Supervisory Control and Data Acquisition (SCADA) system which will issue start, stop, step point commands, drive user interfaces, and enable remote diagnosis and alarming of system problems. These features are essential for high availability, and keeping downtime to a minimum. The system consists of small DIN-rail mountable modules, which are interfaced to component controllers and use industry standard Ethernet communication hardware. Diesel Generator Monitors Monitoring modules are interfaced to the existing generator controllers. These modules send information back to the PowerStore about the current state of the generator (running, stopped, on-line or off-line) as well as how much power the generator is delivering if it is on-line. Using a power transducer tapping in to existing current transformers (CT’s) and potential transformers (PT’s) the monitoring device informs the PowerStore how much power is being generated, as well as how much spinning reserve is available on-line. Wind Turbines The wind turbines are provided with a customer interface to the wind turbine controller (WTC). Monitoring modules are added in order to communicate with the wind turbines. These modules send information and receive information such as the state of the machine (running, stopped, on- line and off-line, power generated, alarms, nacelle position, etc.) back and forth between to the PowerStore supervisory controller and the other individual controllers. Commands can be initiated from the wind turbine controller or from the PowerStore. Typically instruction include, starting machines, stopping machines, reducing the power output of the machine through pitch regulation or power set point control. The WTC would communicate via fiber optic cable. High Renewable Penetration Operation Modes High Renewable Penetration operation occurs under the following three distinct modes: 1. Diesel + PowerStore 2. Diesel + PowerStore + Maximum Wind Turbine 3. Diesel + PowerStore + Limited Wind Turbine Diesel + PowerStore Under this mode of operation, the PowerStore stabilizes the frequency and voltage by using its internal monitoring, as in the basic functionality case. Additional functionality enabled by the inclusion of the external monitoring includes the ability of the PowerStore to provide temporary spinning reserve for overload conditions of the power station. During an overload condition, which is sensed by the generator monitoring modules, the PowerStore will export power in order to reduce the load on the generator down to no more than 100% of their rated power. The automatic power station controller is expected to change the generator schedule in order to prevent the failure of the power system, should the overload continue for an extended time. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 17 of 28 10/7/2009 This feature saves diesel fuel by reducing spinning reserve requirements and also by “peak lopping” short overload peaks will also reduce the number of engine generator starts and stops, configuration changes and maintenance on the generators. Diesel + PowerStore + Maximum Wind Turbine The Diesel + PowerStore + Maximum Wind Turbine mode operates as the Diesel + PowerStore mode, with the addition of the operation of the Wind Turbines. This mode has all of the previous functions, including a significantly reduced requirement for spinning reserve and the frequency and voltage fluctuation reduction. The wind turbine output is monitored by the PowerStore, however the wind turbines are run at their maximum output until the power output of the diesel generators is reduced below a preset parameter (usually 30% - 40% of prime power output, and through automatic selection and configuration). At that point the control system switches to the next mode with limited wind turbine output. Diesel + PowerStore + Limited Wind Turbine The Diesel + PowerStore + Limited Wind Turbine mode operates as the previous mode, with the addition of a control loop to limit the output from the wind turbines such that the diesel generators are never under-loaded – which is detrimental to both the stability of the power system and the mechanical operation of the diesel generators. The method of power limitation for the pitch controlled wind turbines such as the AWE 750 and Fuhrlander 600 machines, the output of the wind turbine can be limited in order reduce the amount of power generated without losing all of the power generated by the machine. The controller can also turn them off wind turbines one-by-one in order to maximize the amount of power delivered by the wind turbines without causing an over-power situation. Future Operating modes, Wind Turbine, Powerstore Diesel off mode: As the operators become more confident with the wind diesel operation, and as more wind capacity is added, the Powerstore can be programmed for voltage support mode. In this mode the Powerstore would become the voltage and energy source for the system, and the diesel gensets could be shut off entirely. Heat Recovery and Demand managed devices This system is designed so that output of the wind farm typically exceeds the electric requirements of the community. Under these conditions wind turbine output can be curtailed, and loads can be managed to capture or control this energy. Two methods are available in this configuration, heat recovery and demand control. At the school, an electric boiler and grid interface, (Dynamic Boiler Grid Interface, DGI), would be installed. The boiler grid interface uses the electric boiler elements, and a variable load inverter system to provide very fast frequency, voltage and power factor correction and capture of excess wind energy. This boiler power demand would be controlled and used to respond to balance the power system during times of collapsing wind power generation. In this instance the DGI captures the first 200 kW of wind energy and follows the load very closely, balancing the energy generation. To the demand through direct frequency control. The DGI assist the Powerstore by rapidly absorbing longer bursts of energy, on a much smaller scale. The electric heat recovery boiler would be plumbed into the existing heating system, and regulated as part of the heating Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 18 of 28 10/7/2009 system, using the same thermostatic controls. Excess wind energy when available would be captured in this boiler and the heat used to offset fuel costs of running the high school. The school represents a large interruptible energy storage system. The heat recovery load at the high school will require separate metering and service panel, including cables, breakers, and breakers. The system would use the existing temperature controls and act as demand managed devices controlled through the master control overlay. The method of communication proposed is Ethernet. Major community buildings with large heating requirements, such as the school, city offices, clinic, city shop, and water and sewer treatment facilities represent potential customers with large heat demand could also benefit from excess energy produced by an expanded wind plant. Electric Thermal Storage An average home in Kipnuk uses over 760 gallons of heating fuel annually. During a windy week in the winter a single home can consume and entire 55 gallon drum of heating fuel. This project proposes to capture the wind and use it to heat homes, throughout the year using Electric Thermal Storage (ETS). ETS is the method of capturing excess wind generated electricity as heat and storing it for use at a later time. An ETS unit, is an insulated metal box, about the same size as a Toyo Stove, which contains electric heating elements which lie within special, high- density ceramic bricks. These bricks are capable of storing vast amounts of heat for extended periods of time. During periods of excess wind energy, a signal from the power plant supervisory controller is sent to the metering system. The meters then enable the relays which turn on elements which heat the bricks. Operation of the system is completely automatic. A sensor monitors the outdoor temperature to regulate the amount of heat the systems stores in the bricks. A thermostat regulates the delivery of the heat to the room. Each unit has a built in microprocessor that allows the owner to configure the operation for their needs. There are over 100,000 of these units in operation in the mid -west states and off-peak heating is common in Europe. The system provides a lower cost low maintenance method of home heating. The village would likely be on an 8-hour charge schedule, with supplement charging in periods of high wind. An individual room-heating unit can both produce and store up enough energy on an 8 plus 2 charge schedule to output 20,000 Btu/ per hour per unit, 24 hours per day. This is similar in size and energy output of a Toyo Stove. The dimensions are 58 inches in length, 24.5 inches in height, and 10.5 inches in depth, and when filled with heat charge bricks each unit weighs 690 lbs. The room units (shown above) are non-ducted and are designed to heat the room or area into which they are placed. These heaters can be used in new construction applications or as a retrofit or supplement to an existing heating system, and only require an electrical connection to operate. Stored heat is circulated evenly and quietly by a fan inside the unit as the room thermostat calls for heat. Individual units are easy to operate and requires very little maintenance. The amount of heat stored in the brick core of the heater is regulated (either manually or automatically) according to seasonal weather conditions using an outdoor temperature sensor and an onboard microprocessor. The Smart metering system enables the ETS to charge, and allocates the costs differently between off-peak wind and diesel only generation. The metering system working with control signals from the diesel plant insures that customers are only charged for the reduced rates excess wind rate for heating. . This project proposes to install 180 residential room heaters. Because of the poor condition of Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 19 of 28 10/7/2009 many electrical service entrances, upgrading of approximately 100 service entrances are required. The budget includes the replacement of 100 service entrances and meter bases in order to receive the Metering system Wind/thermal storage requires a method of notifying the stoves of the availability of low cost wind energy, and a way to account for the difference in cost of wind versus diesel generated electricity. This is done through new meters, which will be placed on each home. The proposed metering platform creates a wireless communications link, which provides fully automated, intelligent two-way communications between the power plant and each meter. The advanced meters offer many additional features that will allow the utility to be managed more effectively, and optimize diesel station operation. The metering system will consist of 3 collector meters, one at the school, one at the washeteria/water plant, and the last at the powerhouse. Each residential customer will have a single-phase meter at their home. These meters will communicate with the data collecting 3 phase meters to create a mesh network. The meters are designed for plug and go capability, which eliminates programming and simplifies installation. This same metering system has been selected for use as it has proven to be a best practice management tool for the Alaska Village Electric Cooperative. Three of the most important features are: 1. Demand control capability that allows the utility to control thermal storage devices remotely. Thermal stoves will be enabled for green energy pricing only when a signal from the utility indicates that an excess of wind energy is available. The meter can switch devices the stoves on and off according the amount of excess wind energy available. The meters can also control other electrical devices such as water heaters and/or controlling lighting or thermostats. 2. User interface. The meters come with an in-home display device that can be used to inform the customer about their cost and energy usage. In the future they can be enabled to enter credit card information to pay bills directly. 3.Pre payment option; the proposed meters can be configured with a prepay option, which requires consumers to pay in advance of use. This feature is requested by small utilities, because it mitigates the financial risks associated with power sales and reduces embarrassing utility disconnects, billing disputes and damage to local relationships. When coupled with the associated user display in each home, the system improves financial management for both the utility and the customer. The in-home display allows utility customers to self manage energy use through real-time, informed decisions about consumption. When combined with the user interface, most customers are typically very satisfied. The need for low cost residential heating represents the largest potential load for the Utility. The mine will operate motors, pumps, heaters, crushers, auxiliary generators and each individual component by itself can be responsible for very large loads. Control modules can be added to these load centers integrate the operation of the mine with the wind diesel system. To obtain the full benefit and for safety, a demand signal/control is introduced to prevent loads from coming on when the power system has insufficient generation on line and to keep engines from running inefficiently and especially for loss of load protection. 4.3.2 Land Ownership Identify potential land ownership issues, including whether site owners have agreed to the project Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 20 of 28 10/7/2009 or how you intend to approach land ownership and access issues. The land needed for the project has been given to the utility by the village corporation. A signed affidavit to that effect is included below. 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 construction of the wind and power project will require some of the following review and/or permitting, no potential barriers have been identified, as the requirements for projects using fe. 1. Coastal Project Questionnaire Since Kipnuk is located in a coastal zone, the project requires submittal of a Coastal Project Questionnaire to the State of Alaska, Department of Natural Resources (DNR). The DNR coordinates review of the questionnaire by various state agencies and assists in identifying required permits pertinent to the project. The standard review spans about a 30- day period. 2. Fire Marshall Plan Review The construction of the new power generating facilities will require submittal of a complete set of construction documents to the State of Alaska, Department of Public Safety, Division of Fire Protection (Fire Marshal) for plan review and approval. The State Fire Marshal then issues a Plan Review Certificate to verify compliance with adopted Building, Fire, and Life Safety codes. Final stamped drawings must be submitted along with the application fee for project review. Anticipate a minimum of one month before comments may be received from Fire Marshal. 3. Alaska Department of Transportation If the construction of a tie-in to the existing electrical distribution system fails within an existing Department of Transportation (DOT) right-of-way, a utility permit from the DOT will be required. 4. Alaska Department of Environmental Conservation Review The Alaska Department of Environmental Conservation (ADEC) regulates the operation of diesel power generation facilities by a consistency review process. The Application for the Pre-Approved Limit Diesel Generation Facility must be submitted prior to the facility startup, provided that the nitrogen dioxide emissions do not exceed 100 tons/year. The review is set up to accommodate future growth of a power plant, provided that the growth is requested during the initial application, and it does not exceed the 100 ton/year on nitrogen oxide emissions. Power plants which fall into the sizes necessary for Alaska villages will not exceed the 100 ton/year level. The addition of the Wind System will significantly reduce the emissions of harmful air pollutants. 5. Regulatory Commission of Alaska Certification The Regulatory Commission of Alaska (RCA) regulates public utilities by certifying qualified providers of public utility and pipeline services and facilities at just and reasonable rates, terms, and conditions. This keeps rates as low as possible while allowing the utility to earn a fair return. The commission also determines the eligibility and the per kilowatt-hour Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 21 of 28 10/7/2009 support for electric utilities under the Power Cost Equalization program. 6. State Historic Preservation Office The State Historic Preservation Office (SHPO) is required, under Section 106 of the National Historic Preservation Act, to review any state of federally funded project for potential of disturbing cultural resources. 7. Federal Requirements • U.S. Fish and Wildlife Service The U.S. Department of the Interior Fish and Wildlife Service will require that any construction project be reviewed for impact to endangered species. The Fish and Wildlife Service has been consulted with respect to this project, and has requested further review due to the known presence of listed species and/or designated critical habitat in the action area, or to the suspected presence of listed species in the vicinity of the action area. Because of the absence of federal funds no formal consultation is required. • U.S. Army Wetlands Permit Projects that disturb or place fill material on existing soil requires a request for a wetlands determination from the U.S. Army Corps of Engineers and, if found to be wetlands, application for a Department of the Army Permit must be submitted for, and granted, before construction begins. • Federal Aviation Administration Review Projects located less than 5 miles from a runway or airport, such as this Wind System, should complete Form 7460-1, “Notice of Proposed Construction or Alteration,” and submit all necessary elevation and height of structure information to the Federal Aviation Administration (FAA), Alaska Region, prior to construction. The FAA reviews the plans and determines whether the construction of project will present a hazard to air traffic in the vicinity. The FAA is very responsive and typically provided project determinations within one week of the completed form submittal. • Bureau of Indian Affairs If the construction of a tie-in to the existing electrical distribution system falls within an existing right-of-way through Native allotment(s), a permit from the Bureau of Indian Affairs (BIA) will likely be required. • Federal Regulatory Commission If the construction of a tie-in to the existing electrical distribution system falls within an existing right-of-way through federal lands, a utility permit from the Federal Energy Regulatory Commission (FERC) may be required. 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 Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 22 of 28 10/7/2009 • Visual, aesthetics impacts • Identify and discuss other potential barriers • Since the land for the project has been selected by the local village corporation, and there no Federal money involved, no significant filling of wetlands is to take place there are no endangered species present, there are no anticipated conflicts or threats to migratory birds, the sites selected are do not represent hazards to flight operations, and are not located in archeological sensitive areas. After contacting the USFWS, the FAA and the Corp of Engineers, it is determined that no permits to construct this project are needed. In each location, the power lines to the wind turbines will extend underground from nearby 3-phase power. No power poles will install and no aerial transmission lines, which could present a hazard to migrating birds, are not being constructed. The Corp of Engineers will place the wind turbines on pile foundations, which will not require any filling of wetlands, and do not require a Section 404 permit. It is not anticipated that any of the Chaninik projects will interfere with or result in the mortalities of any endangered species or migratory birds. The USFWS, Corp of Engineers, FAA and State permitting agencies have been contacted. USFWS concerns have requested that power lines be buried if possible, and to refrain from using guyed towers, to maintain lattice towers by keeping them free of raven nests. Preliminary locations were presented to the FAA, and they have requested a final review of the selected sites, and that the wind turbines be surveyed in, within one month of installation. We will be providing the USFWS, the Corp of Engineers, the FAA and the Alaska State Division of Governmental Coordination. Andrew Grossman has been hired as an environmental consultant for the Chaninik Wind Group projects. He is retired USFWS and NMFS biologist experienced in permitting of construction projects in Alaska. 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.) Operations and Maintenance Summary: Annual Control and Integration Support Service Contract $ 12,000 Wind Turbines Service Contract $ 18,000 Repair/Replace/Insure Estimate $ 21,000 Total Estimated O&M Costs Increase $ 51,000 Explanation Control System: The control system and flywheel come with a two year maintenance contract and an extended warranty is available for a fee of $1000 per month. The local operators will be trained to use the Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 23 of 28 10/7/2009 control and integration system. Typically automated operation reduces the local labor burden. Wind Turbines: The wind system is estimated to operate 350 days or 50 weeks per year with 2 weeks of scheduled maintenance. Service and maintenance agreements as well as loss or damage insurance is available from the manufacturer, and the cost of the turbine includes a 24 month service agreement. The terms of these agreements are negotiated at the time of purchase, and include many options, which range from complete coverage and performance guarantees. A budget of $1000 per month per turbine, or $.02/kWhr per year is set aside. The cost of the turbine includes one week of factory training for two local operators, and one week on site training. The turbines have advanced diagnostic package with remote diagnostics which enable full time monitoring, remote programming and remote technical assistance. Turbine Maintenance: Maintenance can be divided into three categories, routine, unscheduled and scheduled. Routine maintenance is required to maximize performance, maintain safety, and ensure a full operating life of each turbine. An estimate of the cost of annual and 10 year maintenance is provided below. This installation cost estimates include a cost for specialists to be brought in for the first year to perform these functions, and provide additional on-site specialized training to local personnel. This estimate includes setting aside an amount annually for extended and unscheduled maintenance. Excluding major component inspections and replacements, the following maintenance schedules generally apply to each turbine type. Weekly and Monthly Inspections: Bi-Annual Inspections and Service: 10 year inspections: Every 10 years the wind turbines should be thoroughly inspected. Particular attention should be paid to the blades. Most manufacturers recommend that the blades be removed and deflection tested for integrity and strength. This exercise can be conducted using a tower attached jib crane. Each blade would be removed and lowered to the ground, where the blades would be placed in a jig and tested for deflection. At this time the blades would be replaced, resurfaced, and repaired as needed. Repair and replacement fund for failure of major components. An annual replacement account will be set aside to replace major components on the turbine. This set aside account would be based on an annual production estimate of $.02/kWhr. This amount could be readjusted based on rising costs and the comparable cost of fuel. 4.4.3 Power Purchase/Sale Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 24 of 28 10/7/2009 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 Energy Purchases: Kipnuk Light Plant provides electricity to the community and holds the certificate of public convenience. A household survey was conducted and the results indicate that residential customers are desperate for lower cost heating options, as heating fuel is becoming unaffordable at $ 8.00 per gallon. Electric Thermal Storage is a method by which excess wind generated electricity can be stored as heat so that it can be used 24 hours per day. The excess wind energy will be offered to customers at between $ .08 to $.15/kWr, which is equivalent to heating oil equivalent of $ 2.60 to $ 5.00 per gallon assuming that # 2 heating fuel with 138,000 btu/gallon and with a highly efficient furnace with 95% conversion efficiency. Since there is no local wood, or peat or coal, wind heat in this application will be the lowest cost heating source, and highly desirable. 4.4.4 Project Cost Worksheet Complete the cost worksheet form which provides summary information that will be considered in evaluating the project. Download the form, complete it, and submit it as an attachment. Document any conditions or sources your numbers are based on here. 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 Diesel fuel used to generate electricity in Kipnuk is expected to grow from the present level of 150,582 gallons, to 198,000 gallons annually by 2015. This project is estimated to generate 2,048,682 kWhrs of electricity with wind. This will be used in conjunction with the flywheel to displace 90,900 gallons of fuel used to generate electricity and another 24,000 gallons of fuel used for heating. (90,900 x $5.00 = $454,950, plus 24,000 gallons x $6,00/gal for heating fuel = $144,000. The flywheel reduces the diesel run time of the most expensive Caterpillar engine by 4000 hours, which results in doubling its replacement interval, this saving is estimated to be $154,43. 4000 hours x 12.50 per hour, plus ½ of $200,000 replacement costs. In the early years of the project, this energy will be used to displace heating fuel, but as the load grows more fuel used for power generation will be displaced. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 25 of 28 10/7/2009 The estimated project benefit is $753,389 less the additional incurred maintenance costs which are estimated at $48,000 per year. The total financial benefit is $705,389: Large wind with thermal storage, provides three benefits, decreased dependency on fossil fuels means more dollars stay in the community. Wind heat has the potential to increase revenues to the local utility while at the same time reducing home heating costs. 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 Andrew Crow, from the University of Alaska Anchorage, is working with the Chaninik Group to develop a regional wind system business plan, based on a cooperative business model. The primary elements of this plan include utilizing combined funding from the savings of displaced diesel fuel to pay for system maintenance, and overall administration. The greater the number of wind turbines, the more fuel displaced, the more viable the will be the financial strength of the group. One of the principles of successful operation will be to create a well-paid job in each community to support the wind system operation, and to create a network of trained operators, one in each village who can support each other. A proposed source of funding would be to allocate $.05 per kilowatt hour for wind production to the operation and support. Each wind turbine will conservatively produce 150,000 kWhrs annually. This would be $30,000/turbine x 3 turbine = $37500 in additional wages to utility personnel. Another $.03 / kWhr would be dedicated to a replacement fund. However, a production bonus would be paid to the utility personnel for any kilowatt hours produced above 200,000 kWhrs per year. This production bonus would be $.10/kWhrs. This could be as much as $10000 per turbine or $10,000. The increased cost of turbine operations would be partially paid for through the turbine bonus, increased non-fuel operating costs provided in the PCE program, and through fuel savings. The customer would still see a significant decrease in electrical rates, as the current value of kilowatt of displaced fuel is in the range of $.30/kWhr. The Chaninik Wind Group would administer the overall business plan with the assistance of the automated meter reading and information technology systems. In each village the system would be administered through the use of prepaid meters. The business plan in developed wil l provide a detailed management and financial plan, and outline utility performance standards. SECTION 7 – READINESS & COMPLIANCE WITH OTHER GRANTS Discuss what you have done to prepare for this award and how quickly you intend to proceed with work once your grant is approved. Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 26 of 28 10/7/2009 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. Other grants awarded for the wind system in Kipnuk consist of a designated legislative grant for $1,500,000 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. The Council and residents of Kipnuk have been entirely supportive of this project and the anticipated savings it will bring to their community along with the reduced carbon footprint. 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 Provide a narrative summary regarding funding sources and your financial commitment to the project. The System costs are arrived at based on construction experience and supplier quotations. Furnish and Install Wind Turbines $ 1,774,100 Integration, Control and Stabilization $ 1,581,550 Heat Recovery, Storage, metering and management $ 250,030 Project Engineering and Management $ 368,600 Project Cost $ 5,347,236 Cash Match From Utility $ 1,400,000 Grant Funds Requested $ 3,947,236 Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 27 of 28 10/7/2009 Renewable Energy Fund Grant Application Round 3 AEA10-015 Grant Application Page 28 of 28 10/7/2009 SECTION 9 – ADDITIONAL DOCUMENTATION AND CERTIFICATION SUBMIT THE FOLLOWING DOCUMENTS WITH YOUR APPLICATION: A. Resumes of Applicant’s Project Manager, key staff, partners, consultants, and suppliers per application form Section 3.1 and 3.4. B. Cost Worksheet per application form Section 4.4.4. C. Grant Budget Form per application form Section 9. D. Letters demonstrating local support per application form Section 8. E. An electronic version of the entire application on CD per RFA Section 1.6. F. Governing Body Resolution or other formal action taken by the applicant’s governing body or management per RFA Section 1.4 that: - Commits the organization to provide the matching resources for project at the match amounts indicated in the application. - Authorizes the individual who signs the application has the authority to commit the organization to the obligations under the grant. - Provides as point of contact to represent the applicant for purposes of this application. - Certifies the applicant is in compliance with applicable federal, state, and local, laws including existing credit and federal tax obligations. F. CERTIFICATION The undersigned certifies that this application for a renewable energy grant is truthful and correct, and that the applicant is in compliance with, and will continue to comply with, all federal and state laws including existing credit and federal tax obligations. Print Name Signature Title Date Resumes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              •                                                                                                                                                                                                                                                     STATEMENT OF QUALIFICATIONS                 11820 S. Gambell Street • Anchorage, Alaska 99515 • Phone: (907) 644‐4664 • Fax: (907) 644‐4666  info.stginc@gci.net • www.stginc.cc  Over the past fifteen years, STG, In remier construction services and management company. Dealing mainly in rural Alaska, the company has played a major role in high profile projects such as wind energy installations, communication tower installations, and community bulk fuel and diesel generation upgrades, to name a few. STG specializes in remote project logistics, pile foundation installations, tower erections, and construction management. STG takes pride in its wealth of experience, gained from years of work throughout “bush” Alaska, and through its ability to deal with the diverse and challenging logistics and conditions which it encounters on nearly every project it undertakes in remote locations.  Company Overview In 1996, St. George Construction was incorporated as STG, Inc. Since incorporation, STG has become the preferred construction management company for both the Alaska Energy Authority (AEA) and the Alaska Village Electric Cooperative (AVEC). Many of the projects executed by these two entities are managed and constructed by STG. STG’s core competencies include bulk fuel systems, power plant construction (both modular and steel-framed), wind farms, and pile foundations (driven piles, post tension rock anchors, helical anchor systems, freeze back, and active refrigerated piles). STG is the prevalent pile foundation contractor for Interior and Western Alaska. Additionally, STG has expanded to become United Utilities’ preferred contractor for its “Delta Net Project”, which involves the installation of communication towers and related equipment throughout the Yukon Kuskokwim Delta. STG has achieved this preferred status by demonstrating competitive rates and the ability to perform in remote locations with extreme logistical challenges. Qualifications The STG team has developed and maintained the capacity to manage projects through a set of key deliverables to ensure appropriate management of jobs across the complete project cycle including: • Provision of a quality project at a fair and reasonable price • Timely delivery within budget • Safe and professional performance on all work • Positive relationships with clients to ensure that project deliverables are met • New modern equipment that results in high productivity • State of Alaska Professional Land Surveyor (Reg. 10192) on staff with modern Topcon GPS Control through Detailed Project Planning STG focuses pre-construction efforts on planning and preparation. A project team is identified which includes management, administrative, and field supervision personnel. The team establishes budgets, c. has grown and developed into a p production targets, a master construction schedule, and detailed work plan for each project. The planning process involves key supervisory personnel as all aspects of the project are analyzed with particular attention to logistics, labor and equipment resource needs, along with specific material requirements. This results in a clear understanding of the goals of the client, the ontractual requirements, scope of work, and entification of potential obstacles that may impact ion of the job. ough to the administrative level , accurate documentation and reporting, and on to the field level where clear goals of roduction and quality are reinforced through the superintendent’s and foremen’s daily huddles and ost Containment anagement decisions. The project manager and field ork together through this reporting y potential problems and direct resources rform “crisis management” while providing clients with TG employees ’s civic responsibility to local c id the successful complet The project-planning phase also establishes key systems which help assure quality throughout the project. This begins at the management level with a commitment to providing a quality project to the client and carries thr with timely p schedule reviews. C STG maintains budgets for all labor, material, and equipment for each project allowing managers to effectively manage project costs. Expense categories are tracked and updated weekly by the project managers and this information is then communicated to the field pervision level for use in making timely, proactive su m superintendent w system to identif as required to address issues before they impact the work. This proactive approach prevents STG from having to pe on-budget, on-time, turnkey deliveries of completed projects built to engineered specifications. STG maintains a philosophy to deliver the highest level of quality within the industry. S also realize the company’s commitment to its clients along with STG communities. The work that STG performs is a reflection of this commitment. Construction Management and Project Supervision Experience STG has built a reputation of professionalism an products within a set schedule and defined budget. construction services and management contracts wit • Alaska Village Electric Cooperative (A • Alaska Energy Authority (AEA) • United Utilities Inc. (Recently acquire STG has built a wealth of knowledge d thoroughness by delivering the highest quality As a result, STG has been awarded and maintains h the following clients: VEC) d by GCI, Inc.) and experience for lanning, execution, and completion of projects across ral Alaska. Over the years, STG has also enjoyed the ay of he company prides itself in its ability to professionally eal with all the different entities that are related to a roject. In this regard, STG maintains a close working relationship with AVEC’s engineering presentatives, a so id relationship with the AVEC management staff, along with strong connections to rs and vendors across the state of Alaska. e-of-the-art dump trucks, loaders, excavators, pile ural construction projects. During the efficiently supported logistically from two cation shop located in Anchorage, AK and its ons, company construction crews are fully needs that may arise during the course of the p ru opportunity to successfully implement a large arr projects specifically for AVEC including bulk fuel upgrades, diesel power, wind generation, and energy distribution systems. STG can also coordinate all project logistics from procurement, to transportation, to the final project demobilization. T d p re l various sub-contracto STG operates a modern fleet of fourteen cranes, stat drivers, and other equipment needed to support full scale r construction phase of STG projects, remote field crews are STG offices: the company’s headquarters and fabri staging yard located in Bethel, AK. From these locati supported in the field for parts, groceries, and any other project. STG Projects Selawik Power Plant, Tank Farm, and Wind Turbine Installation Client: AVEC Year Completed: 2004 The Selawik Bulk Fuel Upgrade Project exemplifies STG’s diverse capabilities. STG was highly he tank farm and power plant. The company executed the pile site, erected four 65kW wind turbines, of pipelines. n Kasigluk, STG once again demonstrated its abilities to execute omplex, multi-faceted projects. This project entailed transferring primary power generation from Nunapitchuk to Akula Heights while maintaining power generation to these two villages and also m intaining power to Old Kasigluk. As part of this project, STG constructed a new bulk fuel retail facility for the communities of Akula Heights and Old Kasigluk along with a new bulk fuel storage facility, totaling over 600,000 gallons of storage capacity in all. This project also included the construction of a power distribution system to the three aforem villages, the installation of a new diesel generation plant, the erection of three 100 kW wind turbines, the installation of a heat recovery system, upgrades to the school districts bulk fuel facilities, and the installation of a standby generator in Nunapitchuk. involved with the planning and design of t foundation work, fabricated ten 50,000 gallon storage tanks on- and tied the completed system together with a complex network Nunapitchuk-Kasigluk Bulk Fuel Upgrade, Power Plant, and Wind Turbine Installation Client: AVEC Year Completed: 2006 I c a entioned Toksook Bay Power Plant, Wind Generation, and Interties and Nightmute are located in Western Alaska on Nelson Island, an ideal installation of 23 miles of ower lines. STG orchestrated schedules, equipment, materials, field work and logistics to successfully bring this project to completion. Due to the impassible summer tundra conditions, all the intertie work took place in the winter season during sub-zero temperatures. many different levels of scope. iversity in rural construction and e Alaska Energy Authority the set-up, installation, and ties along the middle g the winter Client: AVEC d: 2008 Year Complete oksook Bay, Tununak,T location for wind generation. STG helped deliver a wind/diesel integrated power project for these communities. With three Northwind 100kW wind turbines and a new power plant complete with switch gear and heat recovery module in Toksook Bay, power can now be produced from either diesel fuel, or the natural powers of the wind. In order to capture the greatest value for all island residents, an intertie etwork was established, which connected the three communities through the n p Additional STG Projects STG has completed numerous projects for AVEC throughout the state on The company would also like to highlight a few other examples of its d management for other clients. STG has managed and constructed over a dozen bulk fuel upgrades for th across the western half of Alaska. The most notable of these projects was commissioning of eight modular power plants in eight unique communi Kuskokwim River. The units were built and prepared in STG’s Anchorage yard durin months, then delivered and installed on each site during the short summer season. The company has also gained valuable experience dealing with tower erection and foundation design. ontract with UUI, STG has built foundations for, and has erected, over thirty hroughout western Alaska. This project, known as the Delta-Net Project, has nked dozens of communities for tele-medicine and broadband communication. Two of the most hich unity of St. Paul. Under its term c communication towers t li notable towers are the 305-foot tower in Eek, and the 60-foot tower on top of Marshall Mountain w also required construction of a five-mile access road from the village of Marshall. STG has grown into one of the most experienced integrators of alternative energy systems within the state of Alaska. In addition to the previously referenced projects, this experience is documented through STG’s work to erect and install two Vestas 225 kW wind turbines for TDX Power on the remote Bering Sea island comm Cost Worksheet   Renewable Energy Fund Round 3 Project Cost/Benefit Worksheet   RFA AEA10-015 Application Cost Worksheet Page 1 10-7-09 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. 7.78 m/s average wind speed AEA 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 Railbelt1 grid, leave this section blank) i. Number of generators/boilers/other 3 Diesel Gensets ii. Rated capacity of generators/boilers/other 952 kW(Diesel 1@ 467kW, !@ 350.kW, !@135 kW,) iii. Generator/boilers/other type Diesel iv. Age of generators/boilers/other 250 kW 2008- 467kW Spring 2010, 135 kW 2000 v. Efficiency of generators/boilers/other 11.0 kWhr/gal now, 12.5 est 2010 b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank) i. Annual O&M cost for labor ii. Annual O&M cost for non-labor 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] 1,657,658 kWhrs (est 2015, 2,381,000 kWhrs) ii. Fuel usage Diesel [gal] 150,582 gallons (2015, 198,845 gallons) Other iii. Peak Load 300 kW iv. Average Load 220 kW v. Minimum Load 120 kW est vi. Efficiency vii. Future trends Growing 2% per year d) Annual heating fuel usage (fill in as applicable) i. Diesel [gal or MMBtu] Community wide 200,000 gallons ii. Electricity [kWh] iii. Propane [gal or MMBtu] iv. Coal [tons or MMBtu] v. Wood [cords, green tons, dry tons] vi. Other                                                               1 The Railbelt grid connects all customers of Chugach Electric Association, Homer Electric Association, Golden Valley Electric  Association, the City of Seward Electric Department, Matanuska Electric Association and Anchorage Municipal Light and Power.      Renewable Energy Fund Round 3 Project Cost/Benefit Worksheet   RFA AEA10-015 Application Cost Worksheet Page 2 10-7-09 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) [kWh or MMBtu/hr] 675 kW Wind 500 kW Powerstore flywheel 520 kW thermal electric storage b) Proposed Annual electricity or heat production (fill in as applicable) i. Electricity [kWh] 3,280.433 kWhrs 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 $ 5,400,000 b) Development cost c) Annual O&M cost of new system $ 48,000 d) Annual fuel cost 5. Project Benefits a) Amount of fuel displaced for i. Electricity 90,990 $ gal (2015), x $ 5.00 = $ 454,950 ii. Heat 24,000 gal x $6.00/ gal= $144,000 iii. Transportation b) Price of displaced fuel $ 5.00 c) Other economic benefits Reduced diesel runtime and O&M = $154,439 d) Amount of Alaska public benefits Insure turbine production & improve power quail $ 753,389 (2015), increased locally produced energy sales 6. Power Purchase/Sales Price a) Price for power purchase/sale ½ cost of home heating fuel, approx $.15/kWhr, value of fuel is split between uitliy and home owner, 7. Project Analysis a) Basic Economic Analysis   Renewable Energy Fund Round 3 Project Cost/Benefit Worksheet   RFA AEA10-015 Application Cost Worksheet Page 3 10-7-09 Project benefit/cost ratio Npv, 20 yr, 5%, $753,389- 48,000= $23,324,360, B/C = 4.4 Payback 7.65 years Grant Budget Form Renewable Energy Fund Grant Round III Grant Budget Form 10-7-09 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. ) $ 3,947,236 $ 1,400,000 $ 5,347,236 Final Desiign and Permitting October 2010 $ $ 120,000 $ 120,000 Procure long lead time items April 2011 $1,800,000 $ 640,000 $ 2,440,000 Ship turbine, module August 2011 $ 1,231,000 $ $ 1,281,000 Construction begins Feb 2012 $ 317,236 $ $ 317,236 Construction ends June 2012 $ 419,000 $ 50,000 $ 469,000 Commission Turbines July 2012 $ 30,000 $ 140,000 $ 140,000 Commission controls/flywheel August 2012 $ 100,000 $ 200,000 $ 300,000 Install meters and thermal storage September 2012 $ 50,000 $ 200,000 $ 250,000 $ $ TOTALS $ 3,947,236 $ 1,400,000 $ 5,347,236 Budget Categories: Direct Labor & Benefits $ $ 321,000 $ 321,000 Travel & Per Diem $ $ 47,600 $ 47,600 Equipment $ 294,800 $ $ 294,800 Materials & Supplies $ 2,160,336 $ 500,000 $ 2,660,836 Contractual Services $ 592,100 $ 500,000 $ 1,092,160 Construction Services $ 900,000 $ 31,400 $ 931,400 Other $ $ $ TOTALS $ 3,947,236 $ 1,400,000 $ 5,347,236 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 III Grant Budget Form 10-7-09 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 Supplemental Materials