HomeMy WebLinkAboutVenetie Final ApplicationVenetieWood Energy Heat Program
Renewable Energy Fund
Grant Application
AEA 09-004 Grant Application Page 1 of 15 9/2/2008
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.
Renewable Energy Fund
Grant Application
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SECTION 1 – APPLICANT INFORMATION
Name (Name of utility, IPP, or government entity submitting proposal)
Venetie Village Council
Type of Entity:
Government
Mailing Address
Venetie Village Council
P.O. Box 119
Venetie, AK 99781
Physical Address
Telephone
907-849-8212
Fax
907-849-8149
Email
ninafrank@hotmail.com
1.1 APPLICANT POINT OF CONTACT
Name
William A. Wall, PhD
Title
Project Manager
Mailing Address
PO Box 988 Seeley Lake, MT 59868
Telephone
406-210-9984
Fax
Email
williamwall11@gmail.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
An independent power producer, or
X A local government, or
A governmental entity (which includes tribal councils and housing authorities);
Yes
1.2.2. Attached to this application is formal approval and endorsement for its project by
its board of directors, executive management, or other governing authority. If 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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Grant 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.
Wood Heat Project in Venetie which will develop the following from Phases 2-3:
Complete Phase 2 , Schematic Design; Final Business Plan, Forest Management & Harvest
Plan,
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.
The project is a wood energy district heating project located in Venetie for three buildings: the
school, school housing and washeteria/water system. The applicant is the Venetie Village
Council. The project will be a two year project with completion of project development Phases
2-3 to occur in 2009 and construction Phase 4 to occur in 2010. A level one feasibility boilers
and a reconnaissance of forest wood resources has been performed in the summer of 2008
under a DOE Tribal energy grant for Yukon Flats. A table comparing round wood boiler and
chip fed boilers is attached to demonstrate initial analysis and initial potential designs. It is
anticipated that round wood fired boilers will be used for simplicity of the harvest system. This
will require installation of 3 stick-fired boilers which will require firing up to 4 times per day on
peak heat days and will require approximately 300-350 cords of wood annually to displace
33,390 gallons of fuel oil for heat.
A forest survey by boat and plane revealed an excellent wood resource, and a large fire with
significant amounts of standing dry wood near the village and on a trail system, and thus easily
accessible. There is a small wood harvester entrepreneur interested in increasing his
operations to fill the needs of the district heating system. The village council owns equipment
which could be used for increasing harvest, or a small harvesting system built around a farm
tractor could be installed. A small amount of harvest equipment maybe part of the construction
phase. Partners in the project will be CATG Resource Department, Alaska Wood Energy
Associates which includes Bill Wall, PhD, Peter Olsen and Greg Koontz.
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.
This application requests $88,500 of state funds for a project totaling $108,500 of which
$20,000 is in-kind match. State funds will be used to complete phase 2 & 3. Phase 4
construction will include final design and build for the district heating system and will include any
additional harvest equipment needed. Projected total construction will be approximately
$1,200,000. This portion of the project not only includes development of the technical
information, but also business training and planning through development of the business plan
as a collaborative interactive process with the staff of the Venetie Village Council and other local
participants in the process. These funds will be used for developing a wood delivery design as
well as the wood yard and a schematic design for the District heating system.
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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.
A wood energy project in Venetie will affect energy costs at 2 scales in the village. The first are
local households and the second, which is the key economic driver, are the three commercial
buildings, school, school housing & washeteria/water plant. A reliable source of firewood at a
cost of approximately $250 per cord split and delivered to households will help displace an
unknown amount of fuel oil in the village and reduce heating costs to households. A full cord of
seasoned spruce burned at 80% efficiency will displace approximately 100 gallons of heating
fuel at $7.00/gallon. This benefit is not reflected in the savings and cost analysis of the project
in section 2.5 as it would be only an approximation. The key to this household benefit is that
wood delivery is reliable and split ready for use. A household that burns 500 gallons of fuel will
spend $3500 on fuel. If that is displaced by 80% with wood, then there is a savings of $2800
per household. Reliable sources of wood in combination with house heating education (a
planned village workshop) will encourage investment in cleaner wood burning appliances, thus
yielding an environmental benefit as well.
A level 1 feasibility and side by side comparison of chip fired boilers and stick fired boilers is
attached (see tables 1&2). Expected optimum installation would be a small district heating loop
connecting the school, school housing and water plant in conjunction with a waste heat project
to capture the heat form the power plant generators. The following are the potential savings:
Target Savings: displace 33,390 gallons with 3 stick fired boilers @ one plant @
$8.00/gallon = $267,120 annual displacement of fuel oil importation.
Wood cost: 290 cords @ $250/ cord seasoned wood = $72,500 for wood
Total net simple savings: $194,709 per year or $2,920,063 over 15 year life of project.
A wood energy program can also reduce wildfire risk through forest thinning, enhance wildlife
habitat, and most importantly, create local jobs and economy through import substitution.
Schools are one of the most expensive buildings to heat in the village and a client that will help
with economies of scale for supporting development of a wood energy business model.
Reducing energy costs for schools reduces public support costs for education and health care.
Wood energy business fits with subsistence lifestyles and creates a greater level of self
sufficiency within the village. The process of developing and creating business, management
and planning capacity enhances opportunities for increasing long term opportunities for youth to
stay in the village with well paying resource based jobs. An integrated wood energy system is
one of the best energy and community economic develop projects available to villages with
good wood resources and high cost of heating fuels.
Equipment selection will be based on the types of lands and forest to be harvested, the
transportation system identified, and the type of boilers installed. A fully integrated process from
the forest to boiler operation is critical for efficiency and sustainable success of the installation.
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.)
$1,308,500
2.5.2 Grant Funds Requested in this application. $88,500
2.5.3 Other Funds to be provided (Project match) $20,000
2.5.4 Total Grant Costs (sum of 2.5.2 and 2.5.3) $108,500
2.5.5 Estimated Benefit (Savings) $267,120 gross annually
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.)
$ 4,006.800 gross 15 year
life of project
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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.
Bill Wall, PhD of Alaska Wood Energy Associates will be the project developer and manager for
the project.
3.2 Project Schedule
Include a schedule for the proposed work that will be funded by this grant. (You may include a
chart or table attachment with a summary of dates below.)
A Table of Milestones, Decisions and Activities is attached. The project will be initiated
immediately after notification of a positive response to this application. The intent is to complete
this project over a two year period (2009-2010) with installation of 3 individual boilers in 2010 in
a district heating loop for three buildings. Phase 2-3 will be completed in 2009. A detailed
project implementation and projected construction plan will be developed first quarter of 2009 in
collaboration with Venetie City Council. This will also serve a business capacity training
exercise as well. A schematic design for boilers will be developed prior to application for
construction funds in 3rd quarter of 2009 for installation in 2010. All elements in Phases 2-3,
including sales agreements, environmental analysis and landowner ownership agreements will
all be completed by October, 2009.
3.3 Project Milestones
Define key tasks and decision points in your project and a schedule for achieving them.
A Table of Milestones, Decisions and Activities is attached.
Decisions:
• Level one analysis of stick fired and chip fired boilers has been made. However, a final
feasibility report (in progress) and development of final business plan will occur through
this project. Final decision on type of boiler systems and feasibility of a successful and
sustainable wood energy project will be made prior to requesting funds for construction.
• Current analysis has been conducted using Köb Boilers (chip) versus Garn (stick fed).
Additional review of chip boilers will occur prior to making a final decision on brand of
chip boiler.
Tasks: See Milestone Table – below are specific tasks in Phase 2& 3 to be completed prior to
Phase 4.
• Completion of schematic for each of the boiler installations
• Development of the business structure specifically for Venetie
• Completion of business plan
• Completion of BTU sales agreements for specific customers
• Completion of permitting
• Completion of landownership agreements
• Completion of environmental analysis
These tasks will be completed prior to seeking permission to continue to construction phase and
by the end of the first quarter. Responsibilities are listed in table.
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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.
Ben Stevens: Executive Director of CATG has a background in Business Administration and
has been a leader in support of wood energy program in Fort Yukon. CATG is a partner in the
project as the CATG Resource Department will support development of a forest management
plan through their GIS. Ben will support the program through CATG.
Bill Wall, PhD: Project Manager is developing a reconnaissance study for the Yukon Flats
villages with a level 1 analysis for a wood heating system in Venetie. He has worked to develop
a sustainable wood energy model for interior villages.
Peter Olsen: Forester has developed a cost model for wood harvest in the interior. Peter will
support the Forest Harvesting and Management portion of the program.
Greg Koontz, ME: Engineer contractor conducting the feasibility analysis and side by side
comparison of stick and chip fired boilers. Has experience in biomass operations and energy
savings analysis. Greg will develop the optimal schematic design for the boiler installations.
Doug Johnson: Professional Growth Systems will support the business develop, business
plan and board/employee training to increase business capacity Venetie and CATG.
3.5 Project Communications
Discuss how you plan to monitor the project and keep the Authority informed of the status.
Project communications will focus on three areas:
1. Support team and local implementation partners
2. Venetie Community
3. Funding Partners
A detailed implementation matrix of activities, responsibilities and due dates will be developed
using a dynamic planning process once full funding is secured. This will be developed as part
of a planned training and planning exercise with the Venetie Village Council, the Venetie Tribal
Council and interested residents. This process creates a full understanding on the part of the
community of what is required for a wood heating project to be successful and sustainable. The
matrix will be kept current by the project manager and shared monthly with key members of the
implementation team. A community meeting will be scheduled in Spring of 2009 or at the
implementation kick off to discuss issues with the community. The schedule matrix will be used
as the basis to for a quarterly report to inform all granting agencies of implementation progress
and any key issues. Thus AEA will receive a quarterly report and informal discussions
and calls to the AEA project manager.
3.6 Project Risk
Discuss potential problems and how you would address them.
Risk during phase 2-3 is low. A collaborative process with the community is designed to keep
them informed and used as training for what will be required for a successful and sustainable
project. Since this project is anticipated to be a round wood, stick fired boiler project, technical
risk is low as well. The primary risk with any wood energy project is developing and maintaining
a sustainable and reliable supply of wood and that someone will feed the boiler during cold
weather. Determination of the capacity for this to occur is made during the project development
process of phases 2-3 and the collaborative development of a business model and plan. Only if
there is believed to be a reasonable capacity and determinations to make the project work will
the project manager recommend that the project move to the construction phase.
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Grant Application
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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.
A forest survey/reconnaissance was conducted for Venetie lands in summer of 2008 by Peter
Olsen and Bill Wall, PhD. A forest resource review was conducted at that time by boat, plane
flyover and on the ground via 4-wheeler. Two recent fires have burned behind the village and
will provide a significant amount of seasoned fire wood. An average of 12-15 tons/acre of
harvestable woody biomass is available on fully stocked stands of mixed hardwoods and white
spruce. An individual entrepreneur has an organized fire wood business. With a small amount
of additional equipment, this business could easily supply the 300-350 cords required annually to
meet the District Heating installation needs.
Wood is the only alternative source of energy readily available to displace fuel oil on a village
scale in Venetie. The positive attributes of a wood energy program are that the program is both
an alternative energy program and an economic development program. Harvest and conversion
of wood for energy is import substitution and creates local jobs. The greatest local economic
benefit occurs when ownership and operations are kept local. A key limiting factor which must
be addressed with implementation is to develop the local capacity business, planning and forest
management capacity for harvesting operations and feeding boilers.
4.2 Existing Energy System
4.2.1 Basic configuration of Existing Energy System
Briefly discuss the basic configuration of the existing energy system. Include information about
the number, size, age, efficiency, and type of generation.
The school, school housing and washeteria/water system are heated with oil boilers. A system
to capture waste heat from the generator is also used at the washeteria. Additional information
on the specific age of boilers will be collected. A level 1 analysis is in process and not yet
completed. The summary is attached in Tables 1 & 2. Each building has a dual installation of
Weil McClain or Burnham Boilers. Sizes by BTU/ hour were inventoried and used for feasibility
analysis. It is the intent of this project to continue to use the current oil boilers as a back up
system to wood boilers.
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.
The existing heat energy resources are locally harvested wood and fuel oil purchased at rack
prices for houses and bulk fuel for most of the major commercial buildings. At the household
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level, a wood energy program as described in this project will create a consistent supply of fire
wood for households and may positively affect the willingness of households to invest in efficient
and clean burning appliances. At the commercial scale displacing approximately 33,500 gallons
of fuel will reduce, but not eliminate, the need for bulk deliveries of fuel into the village. This
reduction in the amount of fuel will reduce the frequency of deliveries into the village and
probably not affect the price. Venetie has to fly in all of its liquid fuels.
4.2.3 Existing Energy Market
Discuss existing energy use and its market. Discuss impacts your project may have on energy
customers.
There are two levels of market for each village, households and commercial buildings. The
commercial buildings will drive the actual economies of scale for a feasible project to include a
harvesting and wood energy utility business. Prices were modeled in the level 1 analysis at
$8.00/ gallon. This project will reduce the cost of heat and stabilize the continuous increases
being experienced to date for house holds and the commercial buildings service. This project is
proposing to create a consistent, inexpensive supply of fire wood for residences and to displace
up to 90% of the heating fuel used by up to 3 major buildings with three boilers installed in one
district heating system.
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
• A description of renewable energy technology specific to project location
A Level 1 feasibility analysis has been conducted but not available in report form as yet.
A tradeoff analysis between Garn 3200 boilers and various models of Köb chip fired
boilers has been conducted. A side by side analysis is attached. The analysis identifies
three buildings which can be formed into a district heating system the school, school
housing and water system. Three Garn 3200 boilers will have to be fired a maximum of
4 times a day during greatest heat loads. An automated chip fired system has the same
net simple payback. Chip fired systems are automated, but the harvest, wood processing
and storage are more complex. At this size of system it makes the most sense to use the
stick fired approach, as long as labor is available to reliably feed the boiler. However,
optimum installation configuration is still being determined in the final boiler feasibility
analysis. A final schematic design with costs will be conducted prior to going to a full
design.
• Optimum installed capacity
The optimum installed capacity is to displace 90-100% of the fuel oil used in commercial
buildings. This is 33,500 gallons annually and will require 290-350 cords of seasoned
wood annually.
• Anticipated capacity factor
The anticipated capacity factor displacement of current fuel consumption in a district
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heating system using stick fed boilers is 90-100%. However, this is dependent on
consistent feeding of the district heating system on the coldest days of the year and may
drop to below 90% if oil boilers must turn on during extreme cold.
• Anticipated annual generation – 290-350 cords per year.
• Anticipated barriers
There are two key barriers:
o a reliable supply of good quality round wood delivered into the village;
o reliable labor to feed the boiler;
Both of these issues can be dealt with in the project development and design. Part of
the feasibility analysis is to determine how best to deal with these issues.
• Basic integration concept
Heat integration in each of the installations will be designed where the wood boiler is the
primary and the existing oil boilers are back up. Integration is critical between the wood
harvest and delivery systems and the types of boilers and feeding mechanisms installed.
• Delivery methods
A wood harvest, delivery, storage and feeding system will be developed during phase 2-3
of the project.
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.
Venetie, in conjunction with Arctic Village, own and manage over 1.2 million acres of land. No
issues are anticipated regarding either wood harvest or location of the boilers.
4.3.3 Permits
Provide the following information is 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
List of permits –
• Permits for wood boilers are not required by the State of Alaska for the expected boiler
size. However, once a final design and boiler size is determined, the state will be
consulted to determine what, if any, regulations apply.
• Forest harvesting – The provisions of the Alaska State Forest Practices Act will be
incorporated into harvest and delivery of biomass plans. Development of stream
crossings, ice roads and summer and winter harvest operations may require special
permits. These permits are granted annually, based on harvest and transportation plans.
The permitting request process will begin at least one month prior to seasonal operations
allowing for 30 days in which the plan can be adjusted based on State suggests.
• A clearance from the Alaska State DEC Division of Air Quality will be sought as soon as a
final design is developed and prior to construction on boilers.
• No major barriers are expected on permitting issues.
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
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• 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
This section will address both the current application for boilers and the project for biomass
harvesting:
• Threatened and Endangered Species – no listed species in the project area
• Habitat issues – an initial Forest Survey has been completed for the Venetie ownership
near the village. Opportunities for enhancing moose habitat will be sought and
developed. No significant negative habitat impacts outside the natural range of variation
in this fire driven ecosystem are expected. Harvesting of over mature spruce and
hardwood stands is not expected to be a major portion of the target for biomass
production, but their use could have some small scale local impacts on Neotropical
migratory bird species.
• Wetlands and other protected areas – The Alaska State Forest Practices Act will be
followed in all harvest operations. Accessing or crossing wetlands will only be done
during winter when frozen. CATG Resource Department has an excellent GIS system
and has done mapping on key sensitive areas for each of the villages in Yukon Flats
region. These will be noted during forest harvest transportation planning.
• Land Development Constraints – none are anticipated at this time.
• Telecommunications Interference – none are anticipated at this time.
• Aviation Considerations – none are anticipated at this time,
• Visual and aesthetic impacts – Harvesting of biomass can create unaesthetic impacts
on the forest. FPA required buffers keep harvesting from banks and visibility corridors.
Forest planning can deal effectively with these issues. The wood yard will be fenced and
located on the edge of the village (both current sites). Wood chip deliveries to sites
where noise maybe an issue will be scheduled such that minimum impact will occur.
• Potential Project Barriers – The approach that the project developers have taken in the
development of the Venetie program to date is that this will be a community based project
of converting a village to substantial wood use for heating. We have tried to anticipate
many of the barriers and provide ways to bridge these barriers. However, some
additional barriers will emerge as the project moves forward. Key barriers identified:
o Organization cooperation: developing cooperation among the various key
organizations that are now acting as partners is critical. Venetie is a member of
CATG and will have working relationship with the CATG Resource Department for
land management support.
o For Profit Model Simultaneous Development of Supply, Delivery&Demand
Creating a local structure for a for-profit model for harvesting and converting
biomass and a wood energy utility was key to being confident that both the
biomass supply side and BTU demand side were installed in sync. Thus we have
2 projects: biomass harvest – supply; and boiler installation and operations –
demand. Appropriate economic incentives are being put in the correct places for
economic sustainability. A final business plan will be developed to fit the situation
in Venetie. The Venetie Village Council will most likely be the owner of the
District heating system and a local entrepreneur will likely be the wood supplier.
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
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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
Total Cost Phase2-3: $108,500
Total Cost Phase 4: $1,200,000
Total grant funding requested Phase 2-3 : $88,500
In-Kind Funds: $20,000
Capital Costs: $819,813
Development Costs: $260,296
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
Project O&M costs will be estimated through this project. If a decision is made that three stick
fired boilers are installed, then maintenance costs are minimal and operations are primarily the
cost of labor to feed the boilers.
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 primary largest customer in town is the school district which includes the school and teacher
housing. The next largest customers are the water plant and washeteria operated by the city,
who may also be the owner of the district heating system. Letter of support from the School
Superintendent is attached. An RBEG from DOE has allowed the development of a draft
template BTU purchase agreement, which is culturally relevant to rural Alaska as well as a
stumpage sale agreement. These templates will be used as the starting point for development of
final agreements.
4.4.4 Cost Worksheet
Complete the cost worksheet form which provides summary information that will be considered
in evaluating the project.
Attached
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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.
A final business plan will be completed at the initiation of phase 3 of the project. The basic
business model with financial modeling for all phases has been conducted (see attached
Tables).
Financial modeling to date includes an initial harvest cost analysis which includes cost of forest
harvesting equipment, labor, maintenance, insurance, and fuel costs. The models for wood
harvest and boiler performance are attached. A final business plan will be developed in
collaboration with the Venetie Village Council and others as a business training exercise with the
following major topics:
• Executive summary
• Community information
• Management infrastructure
• Financial data
• Key assumptions
• Capital replacement schedule
• Funding legal authority and issues
• Inter-agency and organization relationships.
4.4.6 Analysis and Recommendations
Provide information about the economic analysis and the proposed project. Discuss your
recommendation for additional project development work.
An economic level 1 analysis has been conducted on two types of boiler chip-fired and round
wood. The configuration is a District Heating System which includes the school, school housing,
and water plant/washeteria. Only a reconnaissance survey has been conducted of the forest
demonstrating that there is a sustainable wood supply. Only initial discussions have been held
with the Village Council. A more detailed analysis on boilers costs needs to be conducted. At
this point both a chip system and a stick-fired system appear to payback about equally and be
worthy of installation. One is automated the other requires had feeding and trade offs beyond
costs needs to be conducted. A cost analysis based on equipment available for wood harvest in
comparison to purchase of some additional harvest equipment needs to be made. A full
feasibility analysis which includes all aspects of sustainability ecological, economic and social
needs to be developed.
Recommend a full study which includes Phase 2-3 be conducted prior to deciding on
construction and purchase of additional harvest equipment.
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
Renewable Energy Fund
Grant Application
AEA 09-004 Grant Application Page 13 of 15 9/3/2008
Project Benefit:
• Fuel Displacement: Annual fuel displacement is 33,500gallons @ current price of $8.00
per gallon is $267,120. At a project life of 15 years total gallons displaced are 502,500
with a total gross savings of $4,006,800.
• Anticipate Revenues: At a delivered wood fuel price of $250/cord for 20% moisture
total demand of 290-350 cords the wood harvest and delivery company will derive an
annuls gross income of $87,500. The intent of the program is to be both an
economically viable wood utility and a service to the community and primary commercial
customers.
• Annual Incentives: Tax credits or other annual incentives have not been explored as
yet.
• Green Credits: CATG has been contacted by several organizations regarding the
potential sale of green credits. Until the scope of the project and the need for additional
incentives has been fully understood within the context of the partners, Green Credits
have not been explored as yet.
• Non-economic benefits: The woody biomass harvest and boiler installations, in
combination create significant non-economic benefits. In multiple discussions and
presentations, community members have commented on how wood energy will create
local jobs that are consistent with their subsistence lifestyles. Community leaders have
commented on how utilizing local resources helps create a culture of sustainability and
self sufficiency, and reduce dependence on outside energy sources. A wood energy
program can also reduce wildfire risk through forest thinning, enhance wildlife habitat and
most importantly create local jobs and economy through import substitution. Schools are
one of the most expensive buildings to heat in the village and a client that will help with
economies of scale for supporting development of a wood energy business model.
Reducing energy costs for schools and clinic reduces public support costs for education
and health care. Wood energy business fits with subsistence lifestyles and creates a
greater level of self sufficiency within the village. The process of developing and creating
business, management and planning capacity enhances opportunities for increasing long
term opportunities for youth to stay in the village with well paying resource based jobs.
An integrated wood energy system is one of the best energy and community economic
develop projects available to villages with a sustainable source of wood.
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
Investments to date include a grant from DOE Tribal Energy Program to CATG for a Yukon
Flats Village level one reconnaissance and feasibility study. The $150,000 grant was shared
among 5 villages that expressed interest in developing a wood energy program. Venetie was
one of the villages.
Phase II: Project Feasibility
Task One: Project Initiation and Dynamic Planning – A major facilitated planning meeting will be
held at the outset of the project to develop a specific dynamic planning outline among all the
major partners to coordinate work, responsibilities, and timing of activities.
• Total costs = $19,500
Requested Funds = $14,500
Travel Funds = $2,000
Cash Match = $
In-Kind = $5,000
Renewable Energy Fund
Grant Application
AEA 09-004 Grant Application Page 14 of 15 9/3/2008
Task Two: Completion of all elements of Phase 2 in project development in association with
Venetie Village Council
• Total Costs = $32,000
• Requested funds = $27,000
• Travel Funds = $2,000
• In-kind support = $5,000
Task Three: Boiler Installation Schematic Design –
Total Cost = $9,000
Requested Funds = $9,000
Travel Funds = $1000
In-kind = $
Task Four: Harvest Delivery Final Deign and wood cost modeling
Total Cost $6,000
Requested funds = $6000
Travel funds = $1000
In-kind support = $
Task Five: Final Business plan wood harvest and boiler operations – Collaborative process with
Venetie Village Council
Total costs = $15,000
Requested funds = $10,000
Federal funds =
In-kind Match = $5,000 l
Task six: Project management and administration.
Total cost $32,000
Requested funds = $27,000
Travel Funds = $2000
In-kind = $5000
SECTION 7 – ADDITIONAL DOCUMENTATION AND CERTIFICATION
SUBMIT THE FOLLOWING DOCUMENTS WITH YOUR APPLICATION:
A. Resumes of Applicant’s Project Manager, key staff, partners, consultants, and
suppliers per application form Section 3.1 and 3.4
B. Cost Worksheet per application form Section 4.4.4
C. Grant Budget Form per application form Section 6.
D. An electronic version of the entire application per RFA Section 1.6
E. Governing Body Resolution per RFA Section 1.4
Enclose a copy of the resolution or other formal action taken by the applicant’s
governing body or management that:
- authorizes this application for project funding at the match amounts indicated in
the application
- authorizes the individual named as point of contact to represent the applicant for
purposes of this application
Renewable Energy Fund
Grant Application
AEA 09-004 Grant Application Page 15 of 15 9/3/2008
- states the applicant is in compliance with all federal state, and local, laws
including existing credit and federal tax obligations.
F. CERTIFICATION
The undersigned certifies that this application for a renewable energy grant is truthful
and correct, and that the applicant is in compliance with, and will continue to comply
with, all federal and state laws including existing credit and federal tax obligations.
Print Name William A. Wall, PhD
Signature
Title Authorized Project Manager
Date November 9, 2008
Renewable Energy Fund
Application Cost Worksheet - Venetie
Please note that some fields might not be applicable for all technologies or all project
phases. Level of information detail varies according to phase requirements.
1. Renewable Energy Source -- Harvested Wood
The Applicant should demonstrate that the renewable energy resource is available on a
sustainable basis.
Annual average resource availability. > 1000 tons/cords annually – sustainable harvest
potential – 350-400 cords needed for project
Unit depends on project type (e.g. windspeed, hydropower output, biomasss fuel)
2. Existing Energy Generation
a) Basic configuration (if system is part of the railbelt grid, leave this section blank)
i. Number of generators/boilers/other 2 boilers per building x 3 buildings = 6
ii. Rated capacity of generators/boilers/other Range from 135KBTU/hr – 805KBTU/hr
iii. Generator/boilers/other type Oil fired boilers
iv. Age of generators/boilers/other Variable 2-10 years
v. Efficiency of generators/boilers/other Oil boilers = 85%
b) Annual O&M cost
i. Annual O&M cost for labor $25,000
ii. Annual O&M cost for non-labor $20,000
c) Annual electricity production and fuel usage (fill in as applicable)
i. Electricity [kWh]
ii. Fuel usage (if system is part of the Railbelt grid, leave this section blank
Diesel [gal]
Other
iii. Peak Load
iv. Average Load
v. Minimum Load
vi. Efficiency
vii. Future trends
d) Annual heating fuel usage (fill in as applicable)
i. Diesel [gal or MMBtu] 33,390 gallons for heat targeted for displacement
ii. Electricity [kWh]
iii. Propane [gal or MMBtu]
iv. Coal [tons or MMBtu]
v. Wood [cords, green tons, dry tons] 350-400 seasoned cords needed to displace fuel oil
vi. Other Current wood use unknown
RFA AEA 09-004 Application Cost Worksheet Page 1
Renewable Energy Fund
3. Proposed System Design
a) Installed capacity 3 Garn 3200 1district heat systems – displace 33,390
gallons
b) Annual renewable electricity generation
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] 350-400 cords seasoned wood required
vi. Other
4. Project Cost
a) Total capital cost of new system $819,831
b) Development cost $260,269
c) Annual O&M cost of new system $45,000
d) Annual fuel cost $87,500
5. Project Benefits
a) Amount of fuel displaced for
i. Electricity
ii. Heat 33,390 gallons of fuel
iii. Transportation
b) Price of displaced fuel $267,120 annually
c) Other economic benefits Local employment, import substitution into village
d) Amount of Alaska public benefits Reduce costs of heating school, district office,
6. Power Purchase/Sales Price
a) Price for power purchase/sale Sell heat BTUs @ between $28.88 – $36.10/MMBTUs
Sell chips @ $175-$200/green ton & $250/cord split
7. Project Analysis
a) Basic Economic Analysis
Project benefit/cost ratio 3:1 on 15 year project
Payback 5.5 years
RFA AEA 09-004 Application Cost Worksheet Page 2
Alaska Energy Authority ‐ Renewable Energy FundVenetie Wood Energy Project Phases 2‐3 FYI 2009BUDGET INFORMATIONBUDGET SUMMARY:Milestone or Task Federal FundsState FundsLocal Match Funds (Cash)Local Match Funds (In‐Kind)Other FunTOTALS1 Project Planning & business training $12,500 $5,000 $17,5002 Completion Phase 2 $20,000 $5,000 $25,0003 Boiler installatin schematic design $8,000 $8,0004 Harvest/ delivery system final design $5,000 $5,0005 Final Business Plan ‐ wood harvest and boilers $10,000 $5,000 $15,0006 Project Management & Administration $25,000 $5,000 $30,0007 Travel support $8,000 $8,000Totals $88,500 $20,000 $108,500Milestone # or Task #BUDGET CATAGORIES:1 2 3 4 5 6 TOTALSDirect Labor and Benefits $5,000 $5,000 $5,000 $5,000 $20,000Travel, Meals, or Per Diem $2,000 $2,000 $1,000 $1,000 $2,000 $8,000Equipment$0Supplies$0Contractual Services $12,500 $20,000 $8,000 $5,000 $10,000 $25,000 $80,500Construction Services$0Other Direct Costs$0.00TOTAL DIRECT CHARGES $19,500 $27,000 $9,000 $6,000 $15,000 $32,000 $108,500RFA AEA09-004 Budget Form
Table 1. Summary Analysis of Stick Fired vs. Chip Fired Boilers Venetie
Summary Venetie
>Three buildings were looked at individually, and then a potential district heating plant to serve all three was studied. In each
case, a stick-fired option and a chip-fired option was studied. In general, the chip-fired options require a large building (or
DH plant) to have enough economy of scale to be cost effective.
>The three buildings are the Washeteria/Water Plant, the School, and the School Housing
>See the TAB "V - C Inputs" for base assumptions for the model, including the cost of oil and wood chips.
>Estimated project costs include construction, as well as design, construction admin, commissioning, and contingency (soft.
costs). Only the major line items are shown here.
>Do not make changes to any parameters in this sheet; it is just a Summary. To change parameters, go to V-C Inputs TAB.
Summary of Results Washeteria School Sch Housing DH Plant
Stick-fired Performnace
baseline oil consumption :8,122 18,073 7,195 33,390
proposed biomass, cords/yr :72 159 64 290
fraction of oil displaced :1.000 1.000 1.000 1.000
Garn model :
WHS 3,200 WHS 3,200 WHS 3,200 WHS 3,200
No. of boilers :
121 3
Maximum wood loads per day req. :
2.8 3.5 2.6 4.1
Stick-fired Cost and savings :
boilers, shipped and installed :
$134,110 $268,221 $134,110 $402,331
Slab/Building for Boilers :
$15,000 $20,000 $15,000 $25,000
direct buried piping :$16,400 $16,400 $16,400 $227,500
interconnection :$35,000 $35,000 $35,000 $105,000
other :$15,000 $15,000 $15,000 $60,000
subtotal :$215,510 $354,621 $215,510 $819,831
soft costs :
$68,425 $112,592 $68,425 $260,296
total :
$283,935 $467,213 $283,935 $1,080,127
baseline oil cost :$64,976 $144,586 $57,558 $267,120
final oil cost :
cord wood cost :
$17,991 $39,719 $16,096 $72,411
total savings :
$46,986 $104,867 $41,462 $194,709
Chip-fired Performnace :
baseline oil consumption :8,122 18,073 7,195 33,390
proposed biomass, tons/yr :78 219 62 403
fraction of oil displaced :0.648 0.816 0.582 0.813
Kob model :
Pyrot 100 Pyrot 150 Pyrot 100 Pyrot 300
No. of boilers :
111 1
Chip-fired Cost and savings :
boilers, shipped and installed :
$202,537 $216,184 $202,537 $259,347
Slab/Building for Boilers :
$5,000 $5,000 $5,000 $5,000
direct buried piping :$16,400 $16,400 $16,400 $227,500
interconnection :$20,000 $20,000 $20,000 $60,000
other :$15,000 $15,000 $15,000 $60,000
subtotal :$258,937 $272,584 $258,937 $611,847
soft costs :$82,213 $86,545 $82,213 $194,262
total :
$341,150 $359,129 $341,150 $806,109
baseline oil cost :$64,976 $144,586 $57,558 $267,120
final oil cost :
$22,872 $26,658 $24,032 $50,043
chip cost :
$13,690 $38,343 $10,901 $70,580
total savings :
$28,415 $79,585 $22,626 $146,497
Net Simple Payback
stick-fired :
6.0 yrs 4.5 yrs 6.8 yrs 5.5 yrs
chip-fired :
12.0 yrs 4.5 yrs 15.1 yrs 5.5 yrs
Table 1. Summary of Analysis Inputs.
Global Inputs Venetie - Chalkyitsik
fuel :
cost of oil :$8.00 per gallon assumption
heat content of oil :134,000 BTU/gal ASHRAE
:
cost of chips :$175.00 per green ton assumption
heat content of wood chips, dry :8,300 BTU/lb assumption
average moistue content when used, MC :0.400 assumption
average fuel temp :45 deg F assumption
heat content of chips at MC :4,252 BTU/lb calc
unit cost :20.58 $/mmBTU calc
:
cost of cordwood :$250.00 per cord assumption
heat content of air-dried cordwod :16.2 mmBTU/cord wood heat reference
storage tank losses as a percent of capacity :0.005 assumption
unit cost :15.43 $/mmBTU calc
:
electricity :$0.55 per kWh
:
Boiler efficienc y :
Kob chip-fired :0.880
Garn stick-fired :0.840
No 1 oil-fired :0.830
:
Insulpex Pipe :
assume carrier pipe nominal ID :3.56 in basis of calc
assume casing OD :6.40 in basis of calc
k value of insulation :0.0150 BTU*ft/hr*sf*deg F mfg data
heat loss per foot per deg F delta T :0.1609 BTU/ft/deg F calc
:
glycol :
fraction of glycol (propelyne):0.60 standard in the area
density at 180 deg F :62.610 lb/ft^3 tables
heat capacity at 180 deg F :0.864 BTU/lb*deg F tables
density specific heat product :433.9 BTU/hr/gpm/deg F calc
:
at peak load :
HWS :180 deg F assumption
building delta T :20 deg F assumption
ground temp, active layer (insulpex):0 deg F Dwayne Miller
permafrost temp (utilidor):10 deg F assumption
:
From Rehau catalog
4", 180 deg F delta T, 40" bury, wet soil, 40" deep :41.6 BTU/ft (heat loss)mfg data
2", 180 deg F delta T, 40" bury, wet soil, 40" deep :22.5 BTU/ft (heat loss)mfg data
:
max flow rate at 5 ft/100, 1", 180 deg F, 50% gly :6 gpm mfg data
max flow rate at 5 ft/100, 1.5", 180 deg F, 50% gly :16 gpm mfg data
max flow rate at 5 ft/100, 2", 180 deg F, 50% gly :34 gpm mfg data
max flow rate at 5 ft/100, 2.5", 180 deg F, 50% gly :55 gpm mfg data
max flow rate at 5 ft/100, 3", 180 deg F, 50% gly :90 gpm mfg data
max flow rate at 5 ft/100, 3.5", 180 deg F, 50% gly :150 gpm mfg data
max flow rate at 5 ft/100, 4", 180 deg F, 50% gly :250 gpm mfg data
Soft Costs
soft costs as a percent of construction cost :0.318 based on Ft Yukon
Venetie Wood Energy Program Milestone & Activity Table * WW William Wall – Project manager Ven Venetie Village Council PO Peter Olsen – Forester GK Greg Koontz – Engineer DJ Doug Johnson – Training and facilitation – Professional Growth Systems AWEA Alaska Wood Energy Associates MILESTONES, DESCISIONS & ACTIVITIES WHO* START Month END Month EXPECTED OUTCOMES 1st 2nd 3rd Quarter (April- December 2009 ) Phase 2-3 Complete contract with AEA & Ven & AWEA Finalize project implementation plan – Dynamic planning Finalize feasibility Complete Schematic Design for boilers Final Business Plan Permitting process Land ownership agreements Environmental Analyses Power Sales Agreement Quarterly reports due WW, Ven WW, PO, DJ WW, PO, GK WW, GK Ven, DJ,PO WW, Ven WW, Ven WW, Ven WW, Ven WW 1 1 1 1 1 1 1 1 2 3 1 3 9 9 9 5 5 5 5 3, 6, 9 Initialize work on Alternative Energy Grant Establish work completion timelines Finalize feasibility study Schematic Design delivered to contract Engineers Facilitated collaborative development of final business plan All necessary applications made for permits as required All necessary land agreements are made with cooperators Final checks on any key environmental issues completed Power sales agreements negotiated and completed Quarterly Report due to AEA
Yukon Flats School District
P. O. Box 350
Fort Yukon, AK 99740
P: (907) 662-2515 or 1.800.322.2515
F: (907) 662-3094 or 2519
www.yukonflats.net
Arctic Village
Beaver
Central
Chalkyitsik
Circle
Fort Yukon
Stevens Village
Venetie
February 8, 2008
William R. Walz, Superintendent
Yukon Flats School District
RE: Letter of Intent to Use Wood Heat for School and Gym in Fort Yukon
To Whom It May Concern:
The Yukon Flats School District is fully supportive of the woody biomass energy
program being developed in Fort Yukon and Yukon Flats Region. I personally am aware
of the community benefits of a woody biomass program as an economic development
project as well as the potential cost savings on fuel to heat our school and gym. I have
experience with the ‘fuels for schools’ programs in the lower 48 and have an
understanding of what is involved in a project such as this.
Through a Statement of Interest, the district applied to the Alaska Wood Energy
Development Task Group last summer. A pre-feasibility study demonstrated that the Fort
Yukon School and Gym use over 30,000 gallons of fuel oil annually for heat at $4.00 per
gallon and an annual cost of $120,000 dollars. We are working with AVI to conduct
feasibility and payback analysis on installing either a Garn boiler or an automated chip
fed boiler. We expect that this installation and purchase of wood fuel offer significant
savings over the life of the project.
Pending Yukon Flats School Board approval of final design and securing funding, it is
our intent to utilize woody biomass for heat and to purchase this fuel from GZ
Corporation. I fully support this application for funds to help “jump start” the integrated
woody biomass program in Fort Yukon and the Yukon Flats Region.
Sincerely;
William R. Walz
Superintendent
.