HomeMy WebLinkAboutChignik Lagoon Hydroelectric Project AppCHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 1 OF 10
AEA-10-015 - RENEWABLE ENERGY GRANT
APPLICATION
C HIGNIK L AGOON H YDROELECTRIC P ROJECT
November 10, 2009
prepared by
polarconsult alaska, inc.
1503 West 33rd Avenue, Suite 310
Anchorage, Alaska 99503
Phone: (907) 258-2420
prepared for
CHIGNIK LAGOON POWER UTILITY
PO Box 130
Chignik Lagoon, Alaska 99565
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 2 OF 10
Table of Contents
SECTION 1. - APPLICANT INFORMATION ...................................................................3
1.1. Applicant point of contact ......................................................................................3
1.2. Applicant minimum requirements ..........................................................................3
SECTION 2. - PROJECT SUMMARY .............................................................................4
2.1. Project Title ...........................................................................................................4
2.2. Project Location ....................................................................................................4
2.3. Project Type ..........................................................................................................4
2.3.1. Renewable Resource Type ............................................................................4
2.3.2. Proposed Grant Funded Phase(s) for this Request (Check all that apply).....4
2.4. Project Description ................................................................................................4
2.5. Project Benefit.......................................................................................................4
2.6. Project Budget Overview.......................................................................................4
2.7. Cost and Benefit Summary ...................................................................................5
SECTION 3. - PROJECT MANAGEMENT PLAN ............................................................5
3.1. Project Manager....................................................................................................5
3.2. Project Schedule ...................................................................................................5
3.3. Project Milestones.................................................................................................5
3.4. Project Resources.................................................................................................5
3.5. Project Communications .......................................................................................5
3.6. Project Risk ...........................................................................................................6
SECTION 4. - PROJECT DESCRIPTION AND TASKS ..................................................6
4.1. Proposed Energy Resource ..................................................................................6
4.2. Existing Energy System ........................................................................................6
4.2.1. Basic configuration of Existing Energy System ..............................................6
4.2.2. Existing Energy Resources Used ...................................................................7
4.2.3. Existing Energy Market...................................................................................7
4.3. Proposed System..................................................................................................7
4.3.1. System Design ...............................................................................................7
4.3.2. Land Ownership .............................................................................................7
4.3.3. Permits ...........................................................................................................8
4.3.4. Environmental ................................................................................................8
4.4. Proposed New System Costs (Total Estimated Costs and proposed Revenues).8
4.4.1. Project Development Cost .............................................................................8
4.4.2. Project Operating and Maintenance Costs .....................................................8
4.4.3. Power Purchase/Sale .....................................................................................9
4.4.4. Cost Worksheet ..............................................................................................9
SECTION 5. - PROJECT BENEFIT.................................................................................9
SECTION 6. - Sustainability ............................................................................................9
SECTION 7. - Readiness and compliance with other grants ...........................................9
SECTION 8. - Local support ............................................................................................9
SECTION 9. - GRANT BUDGET .....................................................................................9
SECTION 10. - ADDITIONAL DOCUMENTATION AND CERTIFICATION ..................10
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 3 OF 10
SECTION 1. - APPLICANT INFORMATION
Name Chignik Lagoon Power Utility (CLPU)
Type of Entity: Exempt Public Utility
Mailing Address PO Box 31
Chignik Lagoon, AK 99565
Physical Address PO Box 31
Chignik Lagoon, AK 99565
Telephone 907-840-2277
Fax
Email diana.clpu@ak.net
1.1. Applicant point of contact
Name Diana Moore
Chignik Lagoon Power Utility
Title: Project Manager
Mailing Address PO Box 31
Chignik Lagoon, AK 99565
Telephone 907-840-2277
Fax
Email diana.clpu@ak.net
1.2. Applicant minimum requirements
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, or
A local government, or
A governmental entity (which includes tribal councils and housing authorities);
Yes 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 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 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 We intend to own and operate any project that may be constructed with
grant funds for the benefit of the general public.
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 4 OF 10
SECTION 2. - PROJECT SUMMARY
2.1. Project Title
Chignik Lagoon Hydroelectric Project.
2.2. Project Location
The project is located on Packers Creek near the native village of Chignik Lagoon on
the Alaska Peninsula.
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
Feasibility X Construction and Commissioning
Conceptual Design
2.4. Project Description
The Chignik Lagoon Hydroelectric Project is a run-of-river hydroelectric project located
on Packers Creek in Chignik Lagoon. The 190 kW project can provide for most of the
communities current power needs, which peak at about 125 kW. The project involves
construction of an intake, a 4650 foot long, 18 inch diameter pipeline, a powerhouse, a
2000 foot long transmission line, and access roads.
2.5. Project Benefit
The hydroelectric project on Packers Creek will alleviate economic hardships by
offsetting the ever-increasing costs of diesel generated electric power. The plant would
eliminate about 85% of 60,000 gallons of diesel consumed by the generators - a
savings of about $150,000 annually. There will also be excess energy that could be
used for heating the school and other local structures as well.
The project will enable improvements to the local infrastructure such as a
freezer/processing facility to further improve the local economy. Environmentally,
renewable energy will significantly reduce the necessity of hauling, storing, and
consuming fossil fuels.
2.6. Project Budget Overview
The total development cost is estimated to be approximately $2,650,000. This includes
a $150,000 grant for design and permitting. Local support towards the project will
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 5 OF 10
consist of cash, equipment, labor, housing, shipping, and other in-kind support totaling
$150,000.
2.7. Cost and Benefit Summary
Grant Costs
2.7.1 - Grant Funds Requested in this application $2,350,000
2.7.2 - Other Funds to be provided (Project match) $150,000
2.7.3 - Total Grant Costs (sum of 2.7.1 and 2.7.2) $2,500,000
Project Costs & Benefits
2.7.4 - Total Project Cost (summary from cost worksheet) $2,650,000
2.7.5 - Estimated direct Financial Benefit (savings) $2,670,000
2.7.6 - Other Public Benefit (explain in section 5) $1,400,000
SECTION 3. - PROJECT MANAGEMENT PLAN
3.1. Project Manager
The owner and developer of the Project is the Chignik Lagoon Power Utility. Diana
Moore has performed exceptionally well as the head of CLPU. CLPU will contract with
a construction management consultant to coordinate the construction of the project,
whether performed by force account or through a bid process.
3.2. Project Schedule
Design work under the FY09 grant will be completed by early 2010. Construction
activities will begin immediately afterward with the plant scheduled to be online by the
end of 2011.
3.3. Project Milestones
The basic project milestones, based on the schedule shown above, are the following:
· Secure construction manager, bids, and select contractor (or labor for
force account).
· Order materials and mobilize with equipment to site.
· Construct transmission line and powerhouse.
· Construct access trail, intake, and pipeline.
· Project startup, as built, and demobilize.
3.4. Project Resources
CLPU plans to contract with Polarconsult to provide construction documents that will be
put out to bid to select a contractor. Polarconsult will also provide inspection services.
Daniel Hertrich will serve as Polarconsult's project manager. A Polarconsult brochure
and resume for Daniel Hertrich is attached.
3.5. Project Communications
Diana Moore of CLPU will be the primary point of communications. She will coordinate
all efforts between the AEA and CLPU consultant. CLPU will require such progress
reports as needed to track the progress of the project. CLPU will also require backup
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 6 OF 10
for all invoices including timesheets and receipts. CLPU will forward all information and
any other required information to the grant administrator.
3.6. Project Risk
The primary risk with this project is going to be cost overruns. CLPU will be minimize
the risk of cost overruns by seeking bids for the major work tasks. Additionally, CLPU
will be able to secure loans based on the avoided costs of fuel should additional funding
be required.
SECTION 4. - PROJECT DESCRIPTION AND TASKS
4.1. Proposed Energy Resource
The following chart represents the expected streamflows at the intake location of
Packers Creek. The chart is taken from the June 26th, 1995 feasibility study performed
by Polarconsult.
Chignik Lagoon Streamflows (est.)
0.0
5.0
10.0
15.0
20.0
25.0
30.0
11/30 1/14 2/28 4/14 5/29 7/13 8/27 10/11 11/25 1/9 2/23
DateStreamflow (cfs)Estimated Flows
Actual Flows
4.2. Existing Energy System
4.2.1. Basic configuration of Existing Energy System
Chignik Lagoon currently meets all of its electrical energy demand through diesel
generation. In 2008 CLPU generated 460,000 kWh while burning 45,000 gallons of
fuel.
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 7 OF 10
4.2.2. Existing Energy Resources Used
Chignik Lagoon relies exclusively on diesel fuel for their electrical and heating needs.
The hydroelectric project will significantly reduce the use of diesel fuel for electrical
generation.
4.2.3. Existing Energy Market
The primary impact of this project will be the stabilization of energy rates. If a significant
portion of construction is eventually funded then the impact on the local energy market
will be a reduction in electrical rates.
4.3. Proposed System
4.3.1. System Design
The physical features of the Project include an intake and desander to collect and filter
water, a 4650’ pipeline to transport water to the powerhouse that will contain the pelton
turbine, generator, controls, and switchgear. The final component is a transmission line
to convey the power to the community.
The intake will consist of a low height structure (less than 10') that will impound the
water enough to collect it into a desander box and transport it by gravity flow to the
powerhouse. The intake may be out of rock filled gabions, concrete, or even rock fill.
The location of the intake is just below the confluence that occurs at about elevation
540'.
The desander box will be constructed from concrete or all weather wood and will ensure
that sand, gravel, leaves, and other debris carried by the creek does not enter into the
penstock and damage the turbine.
The penstock, or pipeline, which conveys the water to the powerhouse, will be 18 inch
in diameter.
The powerhouse will consist of a treated wood or metal structure with a single impulse
or cross flow turbine. The dimensions of the powerhouse will be approximately 20 x 22
feet. The generator will likely be a 480V three phase generator directly coupled to the
turbine.
The controls for the powerhouse will be solid state, PLC based with a load-controlled
governor and a head level control from the intake. This type of governor will allow easy
and less expensive application of a system to capture excess electricity and displace
heating fuel. The controls will need to interface with the existing diesel generation
equipment.
The 2000' power line to the town will be three phase at 7.2/l2.4 kV and will be either
buried or on poles. A communications wire will also be included and will be used for
data and voice transmission. There will be a 250 kVA step up transformer from the 480
volt to transmission voltage. A summary of the Project features is below.
4.3.2. Land Ownership
Most of the project is located on land owned by the Bristol Bay Native Corporation.
Some of the project will also be located on 14c land owned by the Village of Chignik
Lagoon. A small portion (powerhouse site) could be located on land owned by Alagnak
Associates, but, if the land or an easement is unavailable there are suitable alternate
powerhouse sites.
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 8 OF 10
4.3.3. Permits
Federal Energy Regulatory Commission (FERC) - Declaration/Non-juridiction.
US Army Corps of Engineers (USACE) - Wetlands Permit
State of Alaska, Department of Environmental Conservation - Water Quality Certificate
State of Alaska, Division of Mining, Land, and Water - Water Rights Permit
State of Alaska, Office of Habitat Management and Permitting - Consistency and
Coastal Review
State of Alaska, Alaska Department of Fish and Game - Anadromous Fish Passage
Permit
The powerhouse will be located above fish habitat.
4.3.4. Environmental
There are no significant environmental impacts associated with this project.
4.4. Proposed New System Costs (Total Estimated Costs and proposed
Revenues)
4.4.1. Project Development Cost
The current state of project development dictates that only a simple cost estimate is
able to be made. The following table details the major project items and the estimated
costs.
Land $ 70,000
Materials
pipe $ 140,000
turbine $ 150,000
controls $ 50,000
intake $ 60,000
powehouse $ 100,000
transmission $ 60,000
Labor $ 270,000
Equipment $ 200,000
Shipping $ 400,000
Subtotal $ 1,500,000
Contingency (20%) $ 300,000
Total Construction $ 1,800,000
Construction Management $ 250,000
Administrative (5%) $ 90,000
Profit/Overhead (20%) $ 360,000
Total $ 2,500,000
CLPU is asking for State grant funding for Construction work for fiscal year 2011.
4.4.2. Project Operating and Maintenance Costs
Because the hydroelectric project will practically displace all diesel generation the
operations and maintenance costs for the electric utility should decrease. The
hydroelectric project will certainly not require the major overhaul and rebuilding
expenses associated with the diesel plant. However, there may be some
troubleshooting costs during the first years of the hydroelectric operation. For this
reason, CLPU is assuming that the entire maintenance budget will simply be applied to
the hydroelectric project. Thus, rates will not be affected by the project.
CHIGNIK LAGOON POWER UTILITY RENEWABLE ENERGY FUND GRANT APPLICATION
CHIGNIK LAGOON HYDROELECTRIC PROJECT
NOVEMBER 10, 2009 PAGE 9 OF 10
4.4.3. Power Purchase/Sale
Because CLPU, the local utility, will own and operate the project there won't be a
requirement for a power purchase agreement. CLPU may be required to obtain bonds
or other financing to complete the project. The savings in fuel costs from the displaced
diesel operations would fund the necessary financing.
4.4.4. Cost Worksheet
Attached is a completed cost worksheet for the project.
SECTION 5. - PROJECT BENEFIT
The hydroelectric power generating system on Packers Creek will allow for
improvements to the local infrastructure and alleviate economic hardships by offsetting
the ever-increasing costs of diesel generated electric power. Environmentally,
renewable energy will significantly reduce the necessity of hauling, storing, and
consuming fossil fuels. Over the next 30 years this project would displace, at a
minimum, 1.2 million gallons of diesel fuel with a present value in excess of 2.6 million
dollars.
All of the local residents strongly support this alternative energy project that will be
affordable and will help ensure the economic survival of the village. With increased
utilization of the excess Project power the local residents could realize additional
economic benefits at virtually no additional costs.
Not only does rising fuel costs impact the electrical generation rates, it has a significant
impact on the operating costs of the fishing boats. Alleviating the burden of paying high
electrical rates will allow the local residents to absorb the additional costs for their only
economic base – fishing.
SECTION 6. - SUSTAINABILITY
Hydroelectric projects have proven to be, and still are, the most sustainable power
generation investment throughout Alaska. No other generation technology has come
close to having the historical longevity and low maintenance that hydroelectric projects
do. Once the hurdle of the initial capital construction cost is overcome, the projects are
successfully maintained and renewed by all classes of communities in Alaska.
SECTION 7. - READINESS AND COMPLIANCE WITH OTHER GRANTS
Chignik Lagoon contracted with Polarconsult to perform the design and permitting
services shortly after the Round I grant agreement was received at the beginning of
August 2009. Despite the late start, Polarconsult was able to get the necessary
surveying completed so that design and permitting can proceed. Polarconsult expects
to have a completed design by the middle of 2010. This would allow CLPU to begin
construction in 2010.
SECTION 8. - LOCAL SUPPORT
The community of Chignik Lagoon strongly supports this hydroelectric project.
SECTION 9. - GRANT BUDGET
The grant budget form is attached. It includes just the construction portion of the project
which totals $2,500,000 of which CLPU is proposing to pay for $150,000 with the
remainder $2,350,000 funded by this grant.
Cnrcrurx Llcoor.r PowER Uttrv RrNEwneLe ENERGy Furuo GnnHr Applrcnrtox
Cntcrutx Lncoor.t HvoRoeucrntc Pnolecr
SECTION 10. . ADDITIONAL DOCUMENTATION AND CERTIFICATION
A. Resumes of Applicant's Proiect Manager, key staff, partners, consultants, and
suppliers per application form Section 3.1 and 3.4
B. Cost Worksheet per application form Section 4.4.4C. Grant Budget Form per application form Section 6.
D. An electronic version of the entire application per RFA Section 1.6E. Governing Body Resolution per RFA Section 1.4
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 federaltax obligations.
Print Name \iAAl A MocR. [::
Signature (,,r,\ -) \nfrr,r:r*N c*t*
Title f'l $r'.in ir\<-cr.tr,- ut C L? t[
Date \\- t -og
NoVEMBER 6, 2OO9 PAGE 1O oF 1O
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. 85%
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
ii. Rated capacity of generators/boilers/other 150 kW
iii. Generator/boilers/other type Diesel
iv. Age of generators/boilers/other Less than 2 years old
v. Efficiency of generators/boilers/other 10.2 kW/gal
b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank)
i. Annual O&M cost for labor 44,000
ii. Annual O&M cost for non-labor 21,000
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] 460,000
ii. Fuel usage
Diesel [gal] 45,000
Other
iii. Peak Load 115
iv. Average Load 60
v. Minimum Load 45
vi. Efficiency 10.2
vii. Future trends Flat
d) Annual heating fuel usage (fill in as applicable)
i. Diesel [gal or MMBtu]
ii. Electricity [kWh]
iii. Propane [gal or MMBtu]
iv. Coal [tons or MMBtu]
v. Wood [cords, green tons, dry tons]
vi. Other
1 The Railbelt gri d 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]
190 kW
b) Proposed Annual electricity or heat production (fill in as applicable)
i. Electricity [kWh] 1,300,000 kWh
ii. Heat [MMBtu]
c) Proposed Annual fuel Usage (fill in as applicable)
i. Propane [gal or MMBtu]
ii. Coal [tons or MMBtu]
iii. Wood [cords, green tons, dry tons]
iv. Other
4. Project Cost
a) Total capital cost of new system 2,500,000
b) Development cost 150,000
c) Annual O&M cost of new system No change
d) Annual fuel cost None
5. Project Benefits
a) Amount of fuel displaced for
i. Electricity 40,000
ii. Heat
iii. Transportation
b) Price of displaced fuel 3.40
c) Other economic benefits Heating and excess energy, $72,000 per year est
d) Amount of Alaska public benefits Min of 136,000 per year, $208,000 estimated total
6. Power Purchase/Sales Price
a) Price for power purchase/sale Avoided cost = 0.333 $/kWh
7. Project Analysis
a) Basic Economic Analysis
Project benefit/cost ratio 2,670,000 / 2,650,000 = 1.0 min, ((2.67+1.4) / 2.65 = 1.53 est total)
Payback
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
Secure construction manager, bids, contractor 9/1/2010 $280,000 $20,000 Cash and In-kind $300,000
Order materials and mobilize 12/1/2010 $660,000 $40,000 Cash and In-kind $700,000
Construct transmission line and powerhouse 6/1/2011 $610,000 $40,000 Cash and In-kind $650,000
Construct access trail, intake, and pipeline 8/1/2011 $470,000 $30,000 Cash and In-kind $500,000
Project startup, as built, and demobilize 10/1/2011 $330,000 $20,000 Cash and In-kind $350,000
TOTALS $2,350,000 $150,000 $2,500,000
Budget Categories:
Direct Labor & Benefits $117,500 $7,500 $125,000
Travel & Per Diem $70,500 $4,500 $75,000
Equipment $235,000 $15,000 $250,000
Materials & Supplies $705,000 $45,000 $750,000
Contractual Services $282,000 $18,000 $300,000
Construction Services $705,000 $45,000 $750,000
Other $235,000 $15,000 $250,000
TOTALS $2,350,000 $150,000 $2,500,000
Applications should include a separate worksheet for each project phase (Reconnaissance, Feasibility, Design and Permitting, and Construction)-
Add additional pages as needed