HomeMy WebLinkAboutORPC Cook Inlet Tidal AppRenewable Energy Fund
Grant Application
Application Forms and Instructions
The following forms and instructions are provided for 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.html
The following application forms are required to be submitted for a grant recommendation:
Grant Application
Form
GrantApp.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
Costworksheet.doc Summary of Cost information that should be addressed
by applicants in preparing their application.
Grant Budget
Form
GrantBudget.xls A detailed grant budget that includes a breakdown of
costs by task and a summary of funds available and
requested to complete the work for which funds are being
requested.
Grant Budget
Form Instructions
GrantBudgetInstr.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 a plan
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.
AEA 09-004 Grant Application Page 1 of 26 9/2/2008
Renewable Energy Fund
Grant Application
SECTION 1 – APPLICANT INFORMATION
Name (Name of utility, IPP, or government entity submitting proposal)
ORPC Alaska LLC (“ORPC”)
Type of Entity:
Independent Power Producer
Mailing Address
811 West 8th Avenue, Suite 205
Anchorage, AK 99501
Physical Address
SAME
Telephone
907-250-7269
Fax
907-276=4419
Email
djohnson@oceanrenewablepower.com
1.1 APPLICANT POINT OF CONTACT
Name
D. Douglas Johnson
Title
Director of Projects
Mailing Address
811 West 8th Avenue, Suite 205
Anchorage, AK 99501
Telephone
907-250-7269
Fax
907-276-4419
Email
djohnson@oceanrenewablepower.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)
An electric utility holding a certificate of public convenience and necessity under AS
42.05, or
X An independent power producer, 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 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.)
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SECTION 2 – PROJECT SUMMARY
Provide a brief 1-2 page overview of your project.
2.1 PROJECT TYPE
Describe the type of project you are proposing, (Reconnaissance; Resource Assessment/
Feasibility Analysis/Conceptual Design; Final Design and Permitting; and/or Construction) as
well as the kind of renewable energy you intend to use. Refer to Section 1.5 of RFA.
ORPC proposes to complete reconnaissance work and conduct feasibility studies and
conceptual design for its Cook Inlet tidal energy project (FERC permit No. P-12679) in
preparation for a 2011 installation of a 1MW tidal generation device (OCGen™ module).
2.2 PROJECT DESCRIPTION
Provide a one paragraph description of your project. At a minimum include the project location,
communities to be served, and who will be involved in the grant project.
ORPC has obtained a FERC Preliminary Permit for a tidal energy site in a portion of Cook Inlet
and Knik Arm adjacent to the waterfront of Anchorage for the purpose of deploying a
commercial scale tidal energy project. The project will involve the deployment of ORPC's
proprietary ocean current generation (OCGen™) modules consisting of four turbine-generator
units (TGUs). Each TGU consists of a proprietary underwater permanent magnet generator
with four (2 per side) advanced design cross flow (ADCF) turbines attached to and rotating on a
common shaft. OCGen™ technology is deployed well below the water surface and held in place
with a deep sea mooring system so as to be operable beneath the winter ice and avoid any
conflicts with marine navigation. It will be licensed under the FERC hydrokinetic Pilot Project
License program and initially installed at a capacity of 1MW (a single OCGen™ module) for
testing and monitoring of its operation, including any potential environmental impacts. After the
initial OCGen™ module has been operated for a year, additional OCGen™ modules will be
installed to bring the generating capacity of the project up to the limit of 5 MW allowed under the
Pilot Project License. Full build out of the project will occur after a long term FERC Operating
License has been obtained, estimated to be in 2012 or 2013. The project will be interconnected
to the railbelt power grid through either Chugach Electric or ML&P and the electricity generated
will be sold to the railbelt utilities. Preliminary site bathymetric and current surveys have been
performed, reporting and compliance required under FERC rules for the existing Preliminary
Permit have been completed, meetings with regulatory and environmental agencies and project
stakeholders have been held, strong relationships with the local communities have been
established and the application for the Pilot Project License is well underway. The next phase
of development of the project involves significant field studies and data collection, including a
detailed analysis of the tidal currents within the site boundary to identify the optimal locations for
turbine deployment and provide information pertinent to the engineering of the OCGen™
modules, mooring system, and power transmission system. The information gathered from
these studies will be used to complete the conceptual design of the mooring system, the power
transmission system, the grid interconnect system, the deployment plan, and to refine the
design of the OCGen™ module specifically for the Cook Inlet environment. Environmental
impact studies will also be designed in this phase that will include potential impacts to marine
life and sediment transport. This project work will be completed with the assistance and
cooperation of Terrasond LTD, Devine Tarbell and Associates, The University of Alaska
Anchorage, LGL Alaska Research Associates Inc., Aquacoustics, PND engineering, Port
McKenzie, and the Matanuska-Susitna Borough.
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2.3 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. Include a project cost summary that includes an estimated total cost
through construction.
From April 1, 2009 through construction and installation of the initial 1 MW OCGen™ module for
the Cook Inlet Tidal Project, the cost will be approximately $7,858,177. ORPC is requesting
funding from AEA for the feasibility and conceptual design of the project. For this portion of the
project, ORPC is requesting $1,787,476. The majority of these funds will be expended through
sub awards to Alaska contractors retained to perform the site and environmental studies,
assessments and designs necessary to move forward with the project.
Phase 1 – Reconnaissance:
Most of the work for the reconnaissance phase of this project has already been completed or is
currently in progress and has been funded solely by ORPC. Areas that will still need additional
work are completing the design of environmental and biological site characterization studies, the
interconnect study, and research on contractors for project deployment and engineering. A total
of $250,000 has been spent on this phase of the project.
Phase 2 - Feasibility/Conceptual Design/Pilot Project Licensing: $2,428,302
The total budget for phase 2 of this project will be $2,428,302. ORPC is committed to providing
a cost share of $595,825 this amounts to 24.5% of the phase 2 budget.
The budget for the feasibility assessment and permitting of this project will total $1,719,131 and
include work subcontracted to: Terrasond LTD for the amount of $429,906 in field studies and
data collection for site characterization, LGL, Alaska research Associates INC., who will be
contracted to conduct a beluga whale baseline study for $338,500, LGL and Aquacoustics for
implementing a baseline fish study for $282,300, and to Devine Tarbell and Associates for
overseeing all of these activities as well as managing permitting issues for $175,000. In
addition, the project will support a University of Alaska Anchorage research project to create a
dynamic 3D model of the project area to provide necessary information on current distribution
and sediment transfer and enhance their ongoing modeling of Cook Inlet. The budget for this
work is $82,600 and includes a cost share from the University of $45,000. The conceptual
design portion of the project will require a total budget of $709,171. PND Engineers, INC. will
provide consultation and design on the mooring system for $24,000. Additional funds of
$30,000 will be budgeted to contract for preliminary designs of the power transmission systems.
Technical contractors will account for $304,500 while the ORPC technical team salaries will
amount to $214,400 with the remainder being ORPC corporate and project management
funding . Phase 2 will conclude with ORPC obtaining the Pilot Project License for the Cook Inlet
site and completion of the conceptual design for the project.
Phase 3 - Final Design/Engineering: $1,681,718
The final design and engineering of the project is estimated to cost $ 1,681,718. This will include
final design and detailed engineering of the OCGen™ module specifically for Cook Inlet, final
designs of the power transmission system, mooring system, and deployment plan, implementing
project monitoring equipment in compliance with the FERC Pilot Project License, and securing
of all the necessary permits and approvals required for installation of the first OCGen™ module.
Phase 4 – Construction/Installation/Operation/Monitoring: $3,748,157
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The construction phase of the project is expected to cost $3,748,157. It will include
procurement, manufacturing and fabrication of all the OCGen™ module components, shipping
of those components to Port McKenzie, assembly and shop testing of the OCGen™ module at
Port McKenzie, deployment of the 1-module system, operation and monitoring of the project,
and analysis and reporting on data collected from the project.
.2 4 PROJECT BENEFIT
Briefly discuss the financial benefits that will result from this project, including an estimate of economic
benefits(such as reduced fuel costs) and a description of other benefits to the Alaskan public.
ORPC's Cook Inlet Tidal Project promises to bring wide ranging benefits to the state of Alaska
and its people. The direct benefit will be felt not only through the emission-free electricity
produced and supplied to the local railbelt grid, but also through the jobs and other economic
benefits that will be created and enhanced through this project. By leading the way in the
development of this new industry in Alaska, this project will be instrumental in developing the
hydrokinetic energy industry that will one day be a significant contributor to the energy
production portfolio of both urban and remote rural areas. Alaska is situated to be a central
figure in the world's tidal industry as it not only has the second highest tidal range in the world in
Cook Inlet, but also has 95% of the total tidal power potential of the entire United States -
estimated to be an astounding 109TWh per year. This project will help to develop the expertise
of local engineering and research firms to become world leaders in this field. It will also bring the
University of Alaska into the tidal energy field and provide research opportunities for professors
and graduate students, and educational opportunities that will lead students to cutting edge jobs
in this exciting and ground breaking field.
The initial direct economical benefit of this project will depend on the power purchase
agreement that will be resolved in the feasibility phase of this project, however, the anticipated
output of the 1MW OCGen™ module in a current peaking at 6 knots should be 2.628 GWh
annually. At an all-in power sales rate of $.108 per kWh (Chugach Electiric's predicted avoided
cost in 2011) this would amount to $283,824 of annual revenue. Additionally the Federal
Production Tax Credit of $.01 per kWh will generate $26280 annually.
ORPC has a staffed office in Anchorage and has already begun to expand staffing levels with
development of the first Alaskan projects. The jobs created during this installation will include
full time project management and technical positions. In addition local marine service
companies will be contracted for deployment and maintenance, local scientific companies will
be used for site analysis and environmental impact assessments, local engineering firms will be
contracted for design of mooring and power transmission systems, and the local ports will be
contracted for project support. The final assembly of the OCGen™ modules for the Cook Inlet
and subsequent projects will be done at Port Mackenzie with Alaskan labor. The financial
benefits of these jobs and contracts through the project construction will be $ 2,788,774 . Within
the timeframe of the feasibility and conceptual design of this project these benefits will total
$1,321,094. These contracts and jobs include contracts with Alaskan companies such as
Terrasond LTD, LGL – Alaskan Research Associates, INC., Aquacoustics, PND engineers, INC.,
local marine service companies, local ports, the University of Alaska Anchorage, and Alaskans
directly employed by ORPC-Alaska, LLC. In addition the University of Alaska and its Alaska
Center for Energy and Power will be engaged as partners in the project to bring a tidal energy
focus to the university system creating opportunities for educators, researchers and students
alike.
Once the OCGen™ technology is commercially proven and in mass production, many areas of
rural Alaska with high energy costs will be a new market for this technology at a price point that
will be attractive in comparison to existing means of electrical generation. Many sites in the
Aleutian Islands and Southeast Alaska have already been proven to have exceptional tidal
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energy potential. The ongoing repair and maintenance of the OCGen™ equipment will be done
by Alaskans. As ORPC develops this industry and capacity within the state of Alaska, we will be
situated to expand and monetize our expertise in the development of new projects as they are
identified and implemented around the world. In this way this project will help to make Alaska
the center for tidal expertise and development that it is naturally endowed to become.
2.5 PROJECT COST AND BENEFIT SUMARY
Include a summary of your project’s total costs and benefits below.
2.5.1 Total Project Cost
(Including estimates through construction.)
$7,858,177
2.5.2 Grant Funds Requested in this application.$1,787,476
2.5.3 Other Funds to be provided (Project match)$640,825
2.5.4 Total Grant Costs (sum of 2.5.2 and 2.5.3)$2,428,301
2.5.5 Estimated Benefit (Savings)$283,824
2.5.6 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.)
$ 2,788,774*
*This number was derived
from the actual amount of
money that will be spent on
contracts with Alaskan
businesses, and in the direct
employment of Alaskans.
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Grant Application
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 Manager – Monty Worthington
**resume and references attached**
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.)
**SEE ATTATCHED PROJECT SCHEDULE**
Reconnaissance -
10/2009 – Completion date
Feasibility -
09/2009 - Site assessment work completed
09/2010 - Utility interconnect study/power purchase agreement finalized
Conceptual Design -
05/2010 - Conceptual design of component systems completed
Final Design -
12/2010 - Detailed design/engineering of component systems completed
Construction -
04/2011 - OCGen™ Module construction completed
07/2011 - OCGen™ Module deployment completed
12/2011 - Data collection and project report completed
3.3 Project Milestones
Define key tasks and decision points in your project and a schedule for achieving them.
Apply 03/2009 / Secure 03/2010 - Apply for and secure FERC Pilot Project License.
09/2009 - Develop and conduct comprehensive marine mammal (beluga whale) and
other marine species studies to confirm technology is environmentally benign.
09/2009 - Perform feasibility study on Cook Inlet Site and analyze data. Confirm that
adequate energy density exists for power production.
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05/2010 - Perform conceptual design on component systems and confirm that no
insurmountable or economically unfeasible challenges exist.
05/2010 - Budget for final design and permitting of project and secure needed funds.
09/2010 - Do final site assessment with special attention to sub-bottom characteristics
for final mooring and power transmission design.
10/2010 - Complete final design and release components for manufacture and
procurement.
04/2011 - Finalize and secure power purchase agreement with utility.
04/2011 - Receive components for Installation at Port Mackenzie and begin assembly.
06/2011 - Deploy OCGen Module in Cook Inlet.
12/2011 - Collect sufficient data and report on performance of OCGen module and
evaluate economics of project for future expansion.
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.
ORPC is committed to recruiting and retaining contractors and partners for this project from
within Alaska whenever possible, or when not encouraging businesses we work with to
establish a presence here. Our goal is to grow and industry through the contracts we execute
with technical and project support resources. This will support and create infrastructure for
future tidal and hydrokinetic expertise to develop here in Alaska. To this point, ORPC’s key
partners for this project include: Terrasond LTD., The University of Alaska Anchorage, LGL
Alaska Research Associates, Inc., Devine Tarbell and Associates(DTA), PND engineering,
Aquacoustics, ACEP, Port Mckenzie, the Anchorage Economic Development Corporation, and
the Matanuska-Susitna Borough.
ORPC-Alaska's key personnel are:
Doug Johnson – Director of Projects Alaska
Mr. Johnson has over 30 years of project development experience in Alaska. As an
Investor, business owner, entrepreneur, professional manager and business consultant
Mr. Johnson has a comprehensive background in business development. He has worked
through ought Alaska on many diverse projects and has a firsthand appreciation of what
it takes to make projects successful in Alaska. Mr. Johnson’s project development
experience is comprehensive with a range of projects from the launch of Alaska’s first
biotech company to the planning and development of a $2,000,000,000 hospital in Abu
Dhabi. Developing Alaska’s renewable energy potential is one of Mr. Johnson’s a
passions and one he brings his unique abilities to.
Monty Worthington – Alaska Projects Manager
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Mr. Worthington has over 10 years of experience designing and implementing renewable
energy systems in Alaska, including Alaska's first successful hydrokinetic project in
Ruby, Alaska in the summer of 2008 with the Yukon River Inter-Tribal Watershed
Council. He also has extensive experience in design, installation, and maintenance of
marine electrical systems.
The ORPC team includes experienced professionals with successful track records in all the
areas of expertise needed for a renewable energy technology and project development
company to be successful. Brief bios of the key ORPC senior management and technical team
professionals are given below.
Christopher R. Sauer, P.E., President and CEO – Mr. Sauer provides overall
management and leadership in all of ORPC’s technical and commercial activities. Mr.
Sauer is a professional engineer, energy entrepreneur, and strategic development
consultant with more than 30 years of experience in engineering, project development,
electricity, cogeneration, renewable energy, and energy efficiency industries. Mr. Sauer
is a founding member of ORPC and uniquely qualified to lead the Pilot Project into
commercialization.
John R. Cooper, Senior Vice President and CFO – Mr. Cooper manages all
administrative and financial matters for ORPC, including budget management, reporting,
contract administration, financial operations, and accounting. He has more than 30 years
of experience as a senior finance executive in the energy industry involved in project
finance and development, corporate finance, transaction structuring and execution,
raising capital, executive management, consulting, and public Board of Directors
representation. Mr. Cooper is a founding member of ORPC.
Ernest K. Hauser, Vice President, Project Development – Mr. Hauser has overall
management responsibilities for the development of all OCGen™ projects, including
directing and managing the environmental permitting, community relations, vendor
relations and negotiations, commercial contracts and cost estimates. Mr. Hauser has
over 35 years experience in business development, management, project development,
operations, finance, and construction for the energy and petrochemical industries.
Patrick J. McGinnis, P.E., Director of Engineering, TGU Systems – Mr. McGinnis directs
the ORPC engineering effort required to design and specify the TGU sub assemblies
and manage the integration of these components into the TGU and OCGen™ modules.
Mr. McGinnis has more than 20 years experience with major engineering firms including
General Electric, Lockheed Martin, and Ford Aerospace, and more recently with
management of R&D projects at the Naval Surface Warfare Center.
Jarlath McEntee, M.S., P.E., Director of Engineering, ADCF Turbines – Mr. McEntee
directs analysis, subscale prototyping, construction and testing of the ORPC ADCF
turbines, including scale model and full scale testing. Mr. McEntee has 20 years
experience in testing, design, and manufacture of alternative energy systems.
Millard S. Firebaugh, Sc.D., Senior Technical Advisor, Technical Advisory Board – Dr.
Firebaugh plays a key role as senior technical advisor to ORPC and provides direction
and input to the design optimization efforts as well as testing protocols. Dr. Firebaugh, a
retired Rear Admiral in the U.S. Navy, a former Chief Engineer of Electric Boat Corp.,
and a former CEO of SatCon Technologies, is a recognized leader in engineering and
production of advanced technology, including R&D, ship design, shipbuilding, power
systems and electronics, and executive management.
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The following are brief Bios for chief contractors' personnel
●Mary McCann, Senior Aquatic Scientist and Manager of Environmental Services for
Devine Tarbell and Associates. Ms McCann has over 20 years of experience in fisheries
and aquatic habitat studies, fish passage studies, aquatic resources and RTE surveys,
water quality studies, general environmental impact analysis and assessments, and
federal and state licensing and permitting activities.
●David Oliver, Geophysicist Terrasond LTD. Mr. Oliver has over 18 years of technical
experience in the geotechnical and geophysical industry. Recent work has been focused
upon the development of in-stream hydrokinetic and tidal renewable energy feasibility
programs. These investigations have initially included resource assessment, site
selection, and hazard assessment. He is expert at program design, field data collection,
as well as the precise management and spatial analysis of remotely sensed data. Mr.
Oliver has knowledge of a wide variety of geophysical tools, investigative techniques,
and an in-depth understanding of physical science as applied to the Earth and its
surface/subsurface.
●Tom Ravens PhD., Associate Professor, Dept. of Civil Engineering University of Alaska,
Anchorage. Dr. Tom Ravens is Associate Professor in the Department of Civil
Engineering at the University of Alaska Anchorage. Dr. Ravens has about 15 years of
experience in hydrodynamic (wave and current) and sediment transport modeling and
analysis, and has published widely in this field. Dr. Ravens is currently developing flow,
wave, and sediment transport models for Cook Inlet and the Beaufort Sea.
●Tamara McGuire PhD., Lead Scientist, LGL Alaska Research Associates Inc . Dr. Tamara
McGuire has 19 years experience as wildlife biologist and marine mammal scientist and
is the project manager and principal investigator for current LGL studies of Cook Inlet
beluga whales. Dr. McGuire has conducted land- and boat-based research on Cook
Inlet beluga whales and has logged over 500 hours monitoring and theodolite tracking
beluga whales and vessels around the Port of Anchorage in Upper Cook Inlet.
3.5 Project Communications
Discuss how you plan to monitor the project and keep the Authority informed of the status.
ORPC will develop a project management communications approach that best matches the
information needs of AEA utilizing the effective communications ability of ORPC, similar to the
development meetings we engaged with AEA during the inception of the Nenana Hydrokinetic
test site. ORPC maintains an office in Anchorage and thus will be able to report regularly to
AEA on the project performance and timeline. Regular quarterly reports on the project's
progress will be submitted to AEA via email and meetings will be scheduled as necessary to
update AEA staff on the project.
3.6 Project Risk
Discuss potential problems and how you would address them.
Funding:
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In order for the project to be successful, additional funding must be secured for the various
phases at the appropriate times. To this end, funding is being pursued with diversified funding
sources from state and federal grants to private investment capital entities and individuals. If a
project phase is not funded at the appropriate time, the project schedule will be adjusted
accordingly.
Environmental Concerns:
The appropriate environmental studies and mitigations must be implemented to ensure
compliance with permitting issues, and to ensure environmental impacts of the turbine are
acceptable. Of particular concern to ORPC in the Cook Inlet area are the local beluga whales
which have recently been added to the endangered species list. It is of utmost importance that
the TGU's are monitored to ensure they do not further endanger this whale population and
comply fully with any restrictions imposed by the Endangered Species Act. Consultations with
the National Marine Fisheries Service will be undertaken as is required by any commercial
operation in the vicinity of critical habitat for an endangered species. By October of 2009, NMFS
will have identified critical habitat for the whales, and it will be important to ensure that this
habitat is used appropriately. To achieve this ORPC will be contracting LGL to conduct beluga
whale surveys to ensure there is minimal whale usage in the pilot project location, designing
and implementing adequate monitoring methods to ensure there is no impact to the whales, and
considering alternative locations for the pilot project deployment to minimize these concerns.
Ice :
There are concerns over the effects of surface ice, “beach ice” or large conglomerated blocks of
ice, and frazzle ice affecting the turbine. Initial conversations with the experts at the University of
Alaska indicate that surface and beach ice are unlikely to penetrate to a depth where they will
interact with the TGU's which will be at a depth of 40' below the surface. Frazzle ice is also
unlikely to penetrate this deep into the inlet waters as Coast Guard regulations only require a
water intake depth of 10 feet for ships in the inlet to avoid frazzle ice in their engine water
intakes. The possibility of ice conglomerated with rock or sediment and suspended in the water
column still exists and adequate studies will be conducted to determine the extent, if any, of this
that exists at the planned project depths . The main impact of the ice will thus be the effects it
has on the service window for the OCGen module, and the project maintenance schedule will
be planned accordingly.
Sediment Transfer :
There are two main concerns in regard to sediment transfer the first being the possibility of
sediment being deposited and creating shoaling in shipping channels due to the slowing of
natural currents caused by the OCGen™ modules. The second is the effect of natural sediment
transport on mooring systems and particularly buried transmission lines which must be buried at
a depth to ensure they are not uncovered by naturally migrating sand waves. To this end
ORPC will be partnering with UAA to model the sediment transfer prior to installation, and to use
the pilot project to monitor these effects and correlate the model to accurately predict future
effects of the OCGen™ modules on sediment deposition and to plan the installation accordingly.
Mooring system design :
The difficulty of anchoring in the challenging Cook Inlet environment must be taken into
consideration. Local engineering firm PND will be utilized in the design of the mooring system
as they have significant experience in the oil and gas industries mooring systems in Cook Inlet.
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Power Transmission :
The power transmission system must adequately address safety and reliability concerns. The
design and deployment of this system will be undertaken by local contractors with experience in
this area of work to ensure that it is robust and appropriately designed.
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 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 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.
The Cairn Point portion alone of ORPC's tidal permit near the mouth of Knik Arm has an average
flow potential of 116MW as analyzed in the EPRI report on Cairn Point Tidal Potential from June
2006. Further feasibility studies on the resource will more accurately quantify this value as well
as optimize the location of the deployment for maximum power extraction, as the existing data
comes from transects done for the proposed Knik Arm bridge crossing and not with power
generation in mind. The amount of extractable power in this resource also remains to be
quantified but at a conservative 15% this would lead to 17.4MW average extractable power that
varies from a 210MW peak to 0MW through the tidal cycles. The potential of the developable
portion of the entire tidal site is yet to be determined, but will be completed in the feasibility
phase of this project. It is anticipated that the potential power produced from this project area will
offer a significant contribution to the railbelt grid.
Currently most of the power for the Anchorage ML&P and Chugach service areas come from the
Natural Gas fired generation. While this has been a reliable resource for power generation most
railbelt utilities are approaching the end of their natural gas contracts and continued resource
availability as well as price stability are a concern. Current estimates are that to the Cook Inlet
natural gas resource could be depleted as soon as 2022. The possibility of a spur line from the
proposed natural gas pipeline could alleviate this near term energy shortage, but would ensure
that Alaska no longer enjoys stranded gas prices and would be forced to pay the world market
values for natural gas, thus dramatically increasing the cost to electricity. This tidal project would
offer power that would both decrease the usage of the natural gas, and offer a flat priced
alternative if natural gas prices continue to rise. In addition as the tidal power would produce no
greenhouse gases it would be protected from future carbon taxes that could be applied to
electricity produced by natural gas, further improving its economic benefit to the local energy
market.
One project that is being considered in the Anchorage area is CIRI's Fire Island Wind Farm,
currently planned for a capacity of 70MW. This would be an excellent resource to couple with the
tidal resource of Cook Inlet, as the transmission line from Fire Island to Point Worenzof would
open up areas off of Fire Island for tidal development as the power transmission line could be
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utilized for both resources. In addition the more stable and predictable power generated by the
tidal project could be dispatched more easily than the wind power and used to dampen the wild
oscillations in power output associated with wind energy. At the current time wind technology is
much further along in its development than tidal technology, and thus more economical, but tidal
energy promises to be a cost competitive resource once the industry reaches its
commercialization phase.
Hydropower plants already exist on the railbelt grid and larger scale projects such as the Lake
Chakachamna project at 330MW are being investigated for possible development. These
projects offer firm power that is also economical, though upfront costs are quite high. Hydro
projects such as these couple well with renewables that vary periodically. Modern hydro turbine
controls allow them to ramp up and down with the availability of other resources, thus allowing
the reservoir capacity to be conserved and utilized more effectively. Hydro plants already
incorporate wind resources well in this manner, and the predictable nature of tidally produced
energy could be integrated even more easily and efficiently than wind power. Environmentally,
hydro power has concerns in its impact to fish habitat as the turbines are lethal to fish that pass
through them and the intakes often funnel fish into them. Tidal power faces similar concerns with
fish, though there is no ducting to funnel fish into the turbines and the slow speed of the blades
(40rpm) pose minimal risk to the fish, though this remains to be verified in subsequent project
monitoring. One concern that is unique to traditional hydro power comes into play where
andronomous fish spawn and Lake Chakachamna is no exception. Issues with returning salmon
being diverted towards the turbines outflow rather than their natural spawning stream will have to
be addressed for the Chakachamna project.
There is potential for future geothermal development particularly at Mount Spurr near the Beluga
power infrastructure. Geothermal energy holds promise for being a clean, stable, renewable
source of energy, though there are technical challenges in implementing it in seismically active
and glacially dynamic areas such as Mount Spurr. If this project were to happen, it would also
integrate well with tidally generated power much in the same way the power would fit into a
hydro system, allowing the geothermal resource to be reserved when it was periodically offset by
tidal generation.
Coal fired power plants are another alternative being looked into by local railbelt utilities. By
comparison to coal power, tidal energy has significant environmental advantages, as well as
having the potential to be economically competitive as economies of scale drive costs down and
the cost of coal as a fuel source continues to rise. Coal fired power produces not only CO2 which
adds to the effect of global warming, but also mercury, a contaminant the bioaccumulates in the
food chain and has recently become a concern in wild Alaskan salmon. Tidal generated power
would have none of these disadvantages as it is a totally clean renewable energy resource.
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.
Railbelt Energy Project - NA
4.2.2 Existing Energy Resources Used
Briefly discuss your understanding of the existing energy resources. Include a brief discussion of
any impact the project may have on existing energy infrastructure and resources.
Currently most of the power utilized in the Anchorage area in both the ML&P and Chugach
service areas comes from the Beluga natural gas field and power plant. While ML&P has a
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more stable supply of natural gas than other utilities, it is well known that these resources are
dwindling and already businesses such as the Agrium fertilizer plant in Nikiski have had to shut
down due to a scarcity of supply. It is estimated that the current reserves and known gas
resources in Cook Inlet will be depleted by 2022, in addition if a spur from the proposed gas
pipeline becomes a reality the gas in Alaska will no longer be considered stranded gas and thus
be at the mercy of much higher world market prices. This tidal project would have a beneficial
effect on these problems in both the short term as it would help to displace the use of gas and
thus extend the resources viability as well as introducing a long term alternative energy source
which will integrate well with either natural gas powered plants, existing hydro plants such as
Eklutna and Bradley lakes, or the future development of other energy resources such as lake
Chakachamna hydro, the Fire Island Wind Farm, or Mount Spurr geothermal. Depending on the
siting of the build out for this project, an overbuild of existing transmission lines may be
necessary to allow the transmission of the power generated. Currently the infrastructure
maintained by ML&P on EAFB would be limited to a capacity of 37.5 MW but could be upgraded
from 35KV to 115 KV to accommodate 120MW of power. Chugach Electric's infrastructure at
Point Woronzof currently accommodates 200MW of capacity and could thus integrate a
significant tidal resource with a less involved build up.
4.2.3 Existing Energy Market
Discuss existing energy use and its market. Discuss impacts your project may have on energy
customers.
The energy market on the railbelt grid will be in need of significant alternative power production
as natural gas supplies decline. This project will provide stable, predictable, economic, emission-
free power to customers on the railbelt grid. In addition, commercializing the OCGen™
technology in Cook Inlet will allow tidal technology to expand into the rural energy market in
Alaska, where it will offer relief to the high cost of power associated with diesel generation
facilities.
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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
ORPC plans to install its own OCGen™ TGU's at its Cook Inlet tidal site. To generate electricity
from moving water, the OCGen™ TGU uses proprietary hydrokinetic advanced design cross-flow
(“ADCF”) turbines to drive an underwater permanent magnet (“PM”) generator located between
the turbines and mounted on the same shaft, as shown below.
OCGen™ Tidal Turbine-Generator Unit (“TGU”)
Approx.10 FeetApprox.
10 Feet
Incoming
(Flood)
Current
Approximately 78 Feet
Front/Back Elevation Side Elevation
TGU Modular
Structural Frame
ORPC Proprietary Permanent
Magnet Underwater Generator
ORPC Proprietary Advanced
Cross Flow (ADCF) Turbines
Outgoing
(Ebb)
Current
ORPC has developed its own proprietary designs of the ADCF turbine and the PM generator for
use in the TGU and has filed U.S. and Patent Cooperation Treaty utility patent applications for its
ADCF turbine, PM generator and the TGU. For the Cook Inlet Tidal Project, a series of TGUs will
be “stacked” (as shown in the views on the following page) and combined with modular power
electronics and other components to create a much larger power generation platform (the
“OCGen™ module”). OCGen™ modules will be submerged to a prescribed depth, with no
components located or visible on the ocean surface, and will be held in place above the sea
bottom with a deep sea mooring system. Each tidal OCGen™ module will have a generating
capacity of 1 MW in a 6-knot tidal current. The two tidal OCGen™ module configurations are
shown on the next page.
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4~TGU 1MW OCGen™ Modules - Vertical and Horizontal Configurations
Deployment Concept for Tidal OCGen™ Modules
The final build out size of the Cook Inlet site is yet to be determined in the feasibility phase of the
project, but preliminary estimates from the 2006 EPRI study suggest that a capacity of 17.4 MW
is obtainable in the Cairn point area alone. The capacity factor of the OCGen Module in an area
with peak current speeds of 6 knots, which are found within the site boundary is estimated at 30
to 35 percent. This would lead to an anticipated annual generation of at least 2.628 GWh per
1MW of installed nameplate peak capacity.
On the technical side, there are no barriers that will involve breakthrough technological
innovation, but several important challenges must be met. Firstly the OCGen module must be
initially tested and refined in ORPC's Eastport, Maine tidal test site. The main technological
challenges with the module will be addressed there before a commercialized unit is brought to
Alaska. Additional issues that must be addressed in the Cook Inlet environment will include
ensuring that ice, particularly frazzle ice, is not a concern, though initial investigations suggest
the deployment will be well below the range of either frazzle ice or conglomerated surface ice.
Another site specific challenge is the heavy silt content of the Cook Inlet waters. It will be
essential to ensure that this does not effect the design life of the TGUs, though at this point this
also seems to be a manageable problem due to the minimal moving parts of the TGU design. In
addition the silty environment has advantages in terms of its contraceptive effect on marine
growth which is a significant concern that must be addressed in other areas. Mooring in the Cook
Inlet environment will be another technical challenge that will be approached with the assistance
of local expertise in the issue. Alaskan companies such as PND engineers, INC. whose
extensive experience in dealing with mooring issues in the oil and gas developments in Cook
Inlet will help to ensure this hurdle is surmountable.
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Environmentally there are two main concerns at this point that stand out, the effect of the
turbines on marine life, particularly beluga whales, but also salmon, and the effect the turbines
will have on sediment transfer and subsequent deposition. In regards to the beluga issue, NMFS
will be consulted to ensure that the project does not further endanger the cook inlet beluga
population and to ensure that the project is compliant with respect to the Endangered Species
Act and sensitive critical habitat. To address the habitat issue several locations within the large
tidal site will be explored in the feasibility phase to be sure that if there is an issue with one
location in respect to critical habitat issues, another can be used for the pilot project and
monitoring to ensure the turbines will not interfere with the belugas in a negative way. LGL, a
local scientific company, will be contracted to design and implement the necessary beluga
studies and turbine monitoring, as well as addressing the same issues in regards to impacts on
salmon. The main issue in regards to sediment transfer would be in regards to the possible
siltation of navigable channels or ports due to the changes in local currents introduced by the
OCGen™ modules. The University of Alaska has particular expertise in this issue, as they were
contracted for similar studies on the Knik Arm bridge crossing study. From initial discussions it
seems that a simple 1-D model can be made to assess the local impacts of a single module, and
data collected for site characterization can be used to enhance and calibrate the University of
Alaska's 3-D model that will allow simulations of larger installations. This will allow their effects
on siltation to be understood, and thus the future build out planned accordingly to ensure there
are will be no negative effects to either shipping channels or the local ports.
Basic Integration Concept :
The power will be transmitted to shore via a submarine power cable from The OCGen™ module
to the nearest landing, from there it will be power conditioned and transformed to acceptable line
voltage. If deployed in the Cairn Point area of the tidal site, the system will likely be tied into the
local Anchorage ML&P Grid on Elmendorf AFB. The maximum line voltage encountered there is
35kV which would allow transmission for power up to 37.5 MW. The capacity of this
transmission infrastructure could potentially be upgraded to a 115kV line to allow up to 120MW to
be transmitted from the array. If deployed near Fire Island or Point Woronzof, the power would
be transmitted in a similar manner to the Chugach Electric infrastructure which currently handles
a capacity of 200MW and can easily integrate the power produced from the initial 1MW pilot
project and 5MW build out of this project. The power will be highly dispatchable and manageable
due to its regular and predictable interval, much more so than proven renewable energy
technologies such as wind or solar power.
Delivery Methods:
Whenever possible components of the project will be shipped directly to the Port of Anchorage or
Port McKenzie. Larger parts of the system such as the TGU units will be shipped on skids as
they will not fit into standard shipping containers. These parts will be assembled as an OCGen™
module at Port Mckenzie with local labor and equipment. After assembly they will be deployed
with the assistance of local tug and barge companies.
4.3.2 Land Ownership
Identify potential land ownership issues, including whether site owners have agreed to the
project or how you intend to approach land ownership and access issues.
The subsurface lands that will be used for mooring and power transmission systems are property
of the state and may be subject to appropriate ADNR land use permitting requirements. The land
ownership encountered on the shore side of the power transmission system will be identified
when a particular location has been chosen for the turbine in the conceptual design phase of the
project. If the Cairn Point location in Knik Arm is chosen for the Pilot Project, the land on the
shore side will likely be Elmendorf Air Force Base military land and the proper authority and
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rights for using this land will be sought.
4.3.3 Permits
Provide the following informationas 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
FERC Preliminary Permit: Secures site for ORPC- Alaska. Obtained 04/2007
FERC Pilot Project License: Allows for initial testing of hydrokinetic device in preliminary
site area. Draft Application due 3/09, Final Application due 04/10
Fish Habitat Permit (ADF&G): The Fish Habitat Permit requires a 50 day review period
which includes a public notice and comment period coinciding with the Coastal Zone
Management review. It will be applied for by March 2011, procured by May 2011.
Army Corps Title 10 permit: Requires 60 -90 days for approval and Coastal Zone
consistency for final authorization. Applied for by Feb. 2011, procured by May 2011.
Coastal Zone Management: Requires 50 days within ACOE permitting timeline, Applied
for with ACOE title 10 permit in Feb 2011, procured May 2011.
ADNR Water Rights: Waived, not necessary for non-freshwater
Coast Guard Notification: USCG will conduct a waterways assessment in conjunction with
the ACOE permitting process and will recommend approval/disapproval.
4.3.4 Environmental
Address whether the following environmental and land use issues apply, and if so how they will
be addressed:
Threatened or Endangered species
Habitat issues
Wetlands and other protected areas
Archaeological and historical resources
Land development constraints
Telecommunications interference
Aviation considerations
Visual, aesthetics impacts
Identify and discuss other potential barriers
Of prime concern to the success of this project is ensuring it has no adverse impact on the local
beluga whale population, recently added to the endangered species list. To address the beluga
issue, NMFS will be consulted to ensure that the project does not further endanger the beluga
population and to ensure that the project is compliant with respect to the Endangered Species
Act and sensitive critical habitat. To address the habitat issue several locations within the large
tidal site will be explored in the feasibility phase to be sure that if there is an issue with one
location in respect to critical habitat issues, another can be used for the pilot project and
monitoring to ensure the turbines will not interfere with the Belugas in a negative way. LGL
Alaska Research Associates, Inc in collaboration with Devine Tarbell and Associates will be
contracted to design and implement the necessary baseline beluga studies and turbine
monitoring to ensure there are no negative interactions with the belugas.
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Habitat concerns include those regarding the critical beluga habitat as well as salmon habitat.
Studies concerning both of these will be conducted as required by NMFS and the conditions of
the Alaska Department of Fish and Game Fisheries Habitat Permit.
There is no expected impact on or use of wetlands as these units will be mounted subsurface in
the deepest Cook Inlet channels, the same applies to the impacts on local archaeological sites,
historical sites, telecommunications interference, and aviation considerations.
The main land development constraints will involve the use of state subsurface lands, which will
be addressed through the DNR land use permit, and the land used for power transmission once
it is delivered to shore. The main concern in development constraints would be the possibility of
needing to enlarge the size of local transmission lines, which may be necessary in the build out
phase of the project. This could be a challenge with local landowners, but will be addressed as
the need arises.
One additional issue that will need to be addressed is the effect of the OCGen™ modules on
sediment transfer in regards to the possible siltation of navigable channels or ports due to the
changes in local currents introduced by the OCGen™ modules. The University of Alaska has
particular expertise in this issue, as they were contracted for similar studies on the Knik Arm
bridge crossing study. From initial discussions it seems that a simple 1-D model can be made to
assess the local impacts of a single module and further 3-D modeling that will allow simulations
of larger installations. This will allow their effects on siltation to be understood, and thus the
future build out planned accordingly to ensure there are will be no negative effects to either
shipping channels or the local ports.
4.4 Proposed New System Costs (Total Estimated Costs and proposed Revenues)
The level of cost information provided will vary according to the phase of funding requested and
any previous work the applicant may have done on the project. Applicants must reference the
source of their cost data. For example: Applicants Records or Analysis, Industry Standards,
Consultant or Manufacturer’s estimates.
4.4.1 Project Development Cost
Provide detailed project cost information based on your current knowledge and understanding of
the project. Cost information should include the following:
Total anticipated project cost, and cost for this phase
Requested grant funding
Applicant matching funds – loans, capital contributions, in-kind
Identification of other funding sources
Projected capital cost of proposed renewable energy system
Projected development cost of proposed renewable energy system
The total anticipated cost of this project through construction will be $7,858,177. To complete
phase 2 of this project, including feasibility and conceptual design, will cost $2,428,302. ORPC is
requesting $1,787,476 of AEA funding for this phase of the project and will supply $595,825 of its
own funds, with a UAA cost share of $45,000 making up the balance. Through installation, the
projected capital cost of this system will be $2,838,563 and the project development costs will be
$5,019,614(. By the date of the start of Phase 2, ORPC will have invested approximately
$250,000 in this project. ORPC funding sources include venture capital and angel investors who
have funded the startup of ORPC to this point. ORPC has raised approximately $4.5 million to
date and continues to seek diversified funding from federal and state funding sources in
Washington, Maine, and Alaska. Significant funding from the DOE is anticipated in the near
future and it will be a primary focus of ORPC’s funding efforts.
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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.
Total anticipated project cost for this phase
Requested grant funding
ORPC’s preliminary financial analyses of a 20MW OCGen™ project (in a tidal current peaking at
6 knots) projects total operation and maintenance costs of approximately $.025 per kWh
produced, which includes annual maintenance and major maintenance every 6 years. The
annual maintenance would require raising the unit to the surface for cleaning and inspection,
while the major maintenance would involve towing the unit to shore to do a general tune up and
replace bearings and seals. Parts and supplies would account for 20% of the budget while the
remaining 80% would be in labor and service contracts to local marine service companies.
Assuming a slightly higher O&M budget for this project of $.030/kWh would result in an annual
O&M budget of $78,840 for the 1MW pilot project and approximately $394,200 for the 5MW
project. We are not anticipating applying for grant funding for this portion of the project but
would support these costs through internal funding sources.
4.4.3 Power Purchase/Sale
The power purchase/sale information should include the following:
Identification of potential power buyer(s)/customer(s)
Potential power purchase/sales price - at a minimum indicate a price range
Proposed rate of return from grant-funded project
The potential buyers for the electricity generated by this project include all the local railbelt
utilities at this point, however, ML&P, Chugach Electric and Matanuska Electric Association are
the primary utilities being considered as they own the nearby electrical infrastructure. The PPA
will be negotiated in the feasibility phase of the project but initial estimates of power purchase
rates for railbelt utilities range from $0.04 per kWh with local utility ML&P to $0.135 per kWh with
Fairbanks utility GVEA. The current plan would call for intertieing to the Chugach Electric grid in
2011 at which time their avoided cost is predicted to be $0.108 per kWh. Based on a PPA rate
$0.108 per kWh plus $0.01/kWh of Production Tax Credits, the estimated simple rate of return for
the 1MW project is approximately 8.2%. This number is based on a breakeven cost of power for
the project calculated at $0.10 per kWh assuming amortization of the capital at 5% a year over
20 years.
4.4.4 Cost Worksheet
Complete the cost worksheet form which provides summary information that will be considered in
evaluating the project.
See Attachment
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4.4.5 Business Plan
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.
ORPC Alaska, LLC is the business entity that will commercialize Ocean Renewable Power
Company’s OCGen™ technology in Cook Inlet. The business plan is very simple; to deliver
emission-free, predictable, reliable electricity to the Anchorage Bowl and Rail Belt Energy Grid at
a price point that is competitive with existing generation and is lower than new power generation
options. Power purchase agreements will be developed and executed with local utilities to
assure the sustainability of the project. Early conversations have begun with the utilities with
periodic updates on the projects progress.
In the early phases of the project, ORPC will be structured to focus on the preparation needed to
develop Cook Inlet as a world class tidal energy site. During this period company staffing will
consist of two Alaskans. The Alaska Projects Director, Doug Johnson, will continue to lead
strategic development, developing and managing the relationships with communities, partners
and agencies that are needed for successful business growth through new projects. The Alaska
Projects Manager, Monty Worthington, will manage the day-to-day activities that ensure projects
are successful. In the early phases of the Cook Inlet project he will be coordinating the work of
many local firms under contract to assist with the site assessment and permitting work.
At the completion of the early phases a new organizational structure will be developed with a
detailed staffing plan to support the assembly, deployment and testing of the 1MW OCGen™
module for Cook Inlet. Testing of the module will take place over a full year and, at its
completion, ORPC will immediately build out the Cook Inlet site to 5 MW, followed by full build
out of the site, which could be over 100 MW.
Subsequent expansion of OCGen™ module arrays within the Cook Inlet site will take place as
funding is secured and module production is ramped up. During this period the business
structure will change from a development company model to an operating company model, As
Cook Inlet settles into a power production mode ORPC will be developing other tidal and river
sites throughout the state, systematically bringing them into production.
4.4.6 Analysis and Recommendations
Provide information about the economic analysis and the proposed project. Discuss your
recommendation for additional project development work.
Commercial Installation Cost and Breakeven Cost of Electricity Estimates
The ORPC team has extensive experience in commercial power project development and
execution. This strength, together with the knowledge gained from the TGU Demo Project
prototype fabrication and testing completed in 2008, and with input from numerous marine
equipment and installation experts, has allowed ORPC to develop preliminary estimates for
commercial installations and the breakeven cost of electricity. Since there are no commercial
technologies yet available for the production of electricity from tidal currents, it is difficult to
quantify how the ORPC OCGen™ technology will improve on the manufacturing and operating
costs or efficiency of conversion of competing companies. It is possible, however, to demonstrate
the competitiveness of the breakeven cost of electricity (“BCOE”) of the OCGen™ technology
with that of other new potential sources of electricity, including fossil fuel and other renewables.
The BCOE produced from any technology is a combination of amortization of the original
constructed cost, operations and maintenance costs, fuel costs, and environmental externalities
such as permitted air and water pollution, release of greenhouse gases, and the cost of
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mitigation of these that may be separately incurred. In each of these areas, the preliminary cost
estimates for OCGen™ technology demonstrate superior economics, primarily for the following
reasons:
The TGU and other components will be built at a size and scale so that they can be
shop fabricated, with multiple units assembled into OCGen™ modules on site. All
components are robust and mechanically simple, designed for long-life and low
maintenance underwater. There is only one moving part per TGU, with the twin
turbines connected to a single shaft that drives the rotor in the generator. There are
no gears or other mechanisms that are expensive to manufacture and maintain. The
preliminary estimates of installed cost of a 20 MW peak capacity OCGen™ tidal
project in a 6 knot peak tidal current is approximately $50 million or $2500 per peak
KW. The capital investment for these larger OCGen™ projects compares favorably
with new coal or wind generating capacity and is below solar, wave energy,
combined-cycle coal gasification, and nuclear technologies. To the best ORPC can
determine, it is also below the estimated cost for competing tidal energy technologies.
The TGU can be assembled into OCGen modules in a variety of configurations to suit
particular site requirements. The tidal OCGen™ modules will be floated to their
mooring sites and moored using conventional deep sea moorings, without the need
for offshore foundation or piling installations. This is a more cost effective deployment
and installation method than other technologies being proposed and tested.
The OCGen™ technology uses no fossil fuel; therefore, it is not subject to the current
high cost of fuel nor, more importantly, to future escalation (and volatility) in the cost
of fuel. Variable costs are therefore low, based on annual maintenance expenses and
subject only to inflationary increases, not fuel price increases. At today’s prices, just
the variable energy cost component of a new gas-fired combined cycle power plant
will be approximately $0.07 per kWh of generation.
OCGen™ technology installed in tidal currents of 5-6 knots in a project size of 10 MW
or larger, based on current designs and cost estimates would be economical and
commercially viable today. It will compete with new fossil or renewable energy
installations, on both a capital cost and a BCOE basis; it will be considerably cheaper
than most other new energy sources including wave, solar, combined cycle and coal
fired power plant installations. The BCOE of a 10 MW OCGen™ project in a 6 knot
current would be approximately $0.06/KwHr of electricity generated. The BCOE for
other size projects in varying speeds of current are illustrated in the following graph.
These BCOE values are calculated without consideration of any subsidies or
incentives.
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Breakeven Cost of Power for Tidal Current Projects
(Delivered to On-Shore Substation)
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
5.0 5.5 6.0 6 .5 7.0 7.5 8.0
Maximum Current Speed (knots)Cost of Power (cents/Kwh)2.5 MW Project
5 MW Project
10 MW Project
20 MW Project
50 MW Project
Although first and foremost, ORPC sought to prove the technical feasibility of the TGU in the
TGU Demo Project, lessons learned from that project have allowed ORPC to refine its cost
estimates. Although the estimates are not yet to the definitive estimate phase, as a result of the
TGU Demo Project ORPC has developed much better reference costs for making the estimates.
ORPC continues to advance the design of its cross flow turbine. Testing of a variety of turbine
blade designs continues in Eastport, Maine and ORPC has contracted with the University of
Maine – Orno, the University of Massachusetts – Dartmouth and Maine Maritime Academy to
perform a computational fluid dynamic analysis and tank testing. ORPC reached agreement with
SatCon for the development of a power conditioning system for interconnect compatibility. In
addition, US Windblade will be designing and manufacturing turbine blades from marine
composite materials. Harbor Technologies Inc. is presently designing the TGU support frame to
be positively buoyant from marine composite materials.
One potential market being pursued by ORPC is to utilize the existing oil and gas infrastructure
in the Inlet to harness tidal power. Marathon Oil has already approached ORPC with the idea of
mounting its TGU's onto Natural Gas Platforms that are slated to be decommissioned. It is
fortuitous that the natural gas infrastructure in the inlet happens to be situated in an area of
viable tidal currents and near enough to the Beluga Natural Gas Plant that power transmission to
the railbelt grid is also possible.
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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 avoided cost of ownership)
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
As the first tidal energy project being developed in Alaska, this project will bring diversified
benefits to the state of Alaska through not only the energy it will produce and the potential for this
technology to alleviate high energy costs in rural Alaska, but equally importantly will be the
economic benefits created through the inception of a new industry in Alaska and the associated
jobs and business opportunities it creates. Alaska is positioned to be a world leader in tidal
energy development as it not only has one of the greatest tidal resources in the world, but is
situated along major shipping routes and future circumpolar shipping routes to be an exporter of
technology and expertise in this field. This is a crucial time in the development of tidal
technologies and countries that will be leaders in this field are already defining themselves. It is
critical that Alaska becomes recognized as a leader in tidal energy at this time, and this project
will begin this development not only through the demonstration of a successful project, but
through the development of the local university system's expertise in this field and the
development of expertise in local scientific companies like Terrasond LTD, already a company of
world renown in the area or bathymetric mapping.
At this point ORPC has not negotiated a final PPA with any local utilities but preliminary studies
suggest an agreement of $0.108 per kWh at the avoided cost rate for Chugach Electric at the
time of installation in 2011. With an anticipated output for a 1MW OCGen module in a current
peaking at 6 knots of 2.628GWh annually this would lead to $283,824 in annual revenue.
Additionally the federal Production Tax Credit of $.01 per kWh would add $26,280 annually. It is
anticipated that future tax credits will increase to match the $.02 per kWh currently offered for
wind and biomass power and additional green power incentives will lead to a higher purchase
price and shorter payback periods. For a future build out, this will prove economical as the
preceding Breakeven Cost of Electricity (BCOE) analysis showed that in a resource with peak
current speeds of around 6 knots, the BCOE would be from $.07 to $.06 per kWh as a project
ranged in size from 2.5 to 50 MW. Thus at predicted power prices for the dates of project
implementation the project build out will become profitable.
ORPC has an office in Anchorage and has already begun to expand staffing levels with
development of the first Alaskan projects and additional employment opportunities with ORPC-
Alaska will be created through this project. ORPC plans to contract local marine service
companies for deployment and maintenance, local scientific companies for site analysis and
environmental impact assessments, local engineering firms for design of mooring and power
transmission systems, and the local ports for project support. The final assembly of the
OCGen™ modules for the Cook Inlet and subsequent projects will be done at Port McKenzie
with Alaskan labor. In addition the University of Alaska and the Alaska Center for Energy and
Power will be engaged as partners in the project to bring a tidal energy focus to the university
system creating opportunities for educators, researchers and students alike.
Over the lifetime of this project, the public benefit for Alaskans will be substantial. Having the first
tidal project in the state located close to the largest population center will be significant as it will
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Renewable Energy Fund
Grant Application
be a convenient tool for public education on tidal energy and as a demonstration to showcase
the expertise that Alaska will hold in this exciting new field to local residents and visitors alike. It
will be an ongoing research subject and tool for the local university system to utilize in the
development of its own expertise and focus in tidal studies. As the project continues to prove out
and develop it will offset significant energy usage on the local grid, and create jobs involved in
the installation, operation, and maintenance of the OCGen™ modules. Local ports and marine
service industries will secure significant long term contracts in the installation, operation, and
maintenance of the OCGen™ modules, and local scientific companies will be utilized to
continually monitor and refine the installations. In the long term this project will help to inspire
young Alaskans as to the potential of their State, its natural resources, and the ingenuity of the
people who live here, thus nurturing unknown and profound new innovations from the next
generation of Alaskans.
SECTION 6 – GRANT BUDGET
Tell us how much your total project costs. Include any investments to date and funding sources,
how much is requested in grant funds, and additional investments you will make as an applicant.
Include an estimate of budget costs by tasks using the form - GrantBudget.xls
Provide a narrative summary regarding funding sources and your financial commitment to the
project.
ORPC has already invested significant resources in the development and permitting of its Cook
Inlet tidal site. These efforts have been funded entirely by ORPC at this point and they have
included work on obtaining and complying with FERC permitting, site assessment and data
collection, meetings with communities, agencies, stakeholders, contractors, public officials and
others involved or affected by the project, participation in organizations, conferences and
industry meetings, etc. and they will total as much as $250,000 by the time the AEA funding for
this project would commence. In addition ORPC has already invested over $4 million in its own
OCGen™ technology development that will later be taken advantage of in the Cook Inlet Tidal
Project. This company funding has to date come from founder equity, “friends and family”
investment, state funding from Maine and Massachusetts, individual angel investors and
venture fund investment.
The total budget for the Cook Inlet tidal Project is estimated at $7,858,177. ORPC is requesting
$1,787,476 from AEA for Phase 2 to conduct the feasibility study and conceptual design of this
project, The remaining funding for Phase 2 will be provided by ORPC in the amount of $595,825
and a University of Alaska in-kind of $45,000. During the execution of this phase of the project,
additional funding will be sought from diversified funding sources, from private investment to
Federal and State funding opportunities including future AEA and DOE grant opportunities to
fund the remainder of the project.
ORPC has developed a detailed budget for the installation through 2012 and its eventual 5MW
build out reflecting ORPC's investment in this project. ORPC is committed to the Cook Inlet
Tidal Project as its second tidal installation and full scale commercial build out utilizing the
technology it is currently proving out at its Eastport, Maine site. From securing project funding
to project implementation, Ocean Renewable Power Corporation will do all it possibly can to
ensure a successful project in Cook Inlet
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