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HomeMy WebLinkAboutBristol Bay Fish Waste App Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 1 of 17 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 AEA 09-004 Grant Application Page 2 of 17 9/3/2008 SECTION 1 – APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) Naknek Electric Association Type of Entity: Electric Utility Mailing Address Po Box 118, Naknek, AK 99633 Physical Address 100 School Road, Naknek, AK 99633 Telephone (907)246-4261 Fax (907)246-6242 Email 1.1 APPLICANT POINT OF CONTACT Name Thomas Cantrell Title Grant Writer/Grant Administrator Project Administrator Mailing Address 225 West Broadway (300 South) Salt Lake City, UT Telephone (801)355-2005 Fax Email Tom@TomCantrell.com 1.2 APPLICANT MINIMUM REQUIREMENTS Please check as appropriate. If you do not to meet the minimum applicant requirements, your application will be rejected. 1.2.1 As an Applicant, we are: (put an X in the appropriate box) X An electric utility holding a certificate of public convenience and necessity under AS 42.05, or An independent power producer, 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 fort h 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.) Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 3 of 17 9/3/2008 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. Power to the People – from fish! This feasibility study explores and proves scientifically the potential and practicality for generating significant and renewable energy from fish products normally considered “waste” in Bristol Bay which happens to be the largest sockeye salmon fishery in the world. We have completed over three months of reconnaissance on determining the viability and practicality of this project. We’ve interviewed scientists, processors, independent operators, fishers, and even set netters (who get to catch the guts and fins and heads – twice – as the tide ebbs and flows. Remember belly fat, skins and heads make up the primary source of the fish oil we seek). We have a clea r and accurate perception of the need, the feasibility and the profitability of this project now and in the future. This is a significant project. This will affect the entire state and potentially the nation. It may well affect the world in the way it sees and deals with fish waste. What does that have to do with energy? It is both energy conserving and energy producing. It is energy conserving because it doesn’t waste the energy that was used to produce and separate the part of the fish (30%) that is tossed back as waste. It is energy producing in that we will harvest from the fish waste fuel-grade fish oil that will NOT reduce the quality of diesel that it is mixed with as a fuel for electricity production or equipment operation. (It is important that we remember that there is no discernable difference between the power generation quality of regular diesel and bio- diesel with fish oil as the additive.) As we said, the Bristol Bay fishery is the largest in the world. The fishery harvested over 29 million salmon this year with a total weight of 173.4 million pounds (this is a good year, but not dramatically exceptional in that it is only 9% above the 20 year average). Given that the average waste is 30% of the fish, the Bristol Bay fishery then disposed of approximately 52 million pounds of their harvest as “waste” most of it ultimately unnecessarily. They dumped it into the river or the bay as ground up waste (grey water) or otherwise (hence some recent fines and the irritated set netters). This offends the sensibilities of the economist, green planet enthusiasts, Alaskan natives, and any mother who has ever told her children “waste not, want not .” Of that 52 million pounds of waste, we will utilize about 50% within a reasonable time following start-up of our fish waste processing facility. That will reduce the overall waste to 15% and will soothe the set netters who will no longer be troubled with catching fish guts in their nets. The effective utilization of the remaining fish waste will eventually rise to nearly 90% use – a more palatable, though still not quite acceptable, 10% remaining waste. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 4 of 17 9/3/2008 How much energy will we produce in addition to the energy we are conserving? Well, the Naknek Electric officials suggest that even if we can only add 10 percent to their power grid that will make a significant difference in the community we serve. At this writing, they cannot add a single fish processing plant or any other major facility that draws much more energy than a Duracell battery. Our facility will produce its own energy – or a large portion of it – the feasibility study will demonstrate that too – as we produce the products and by-products (energy, animal food, etc.) that will financially and practically justify the community energy we do use as well as the funds required to complete this study and build the facility. 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. It Isn’t Easy To Be Green; But it is Entirely Possible. Feasibility Study This study examines the opportunity, analyzes the possibility, and determines the feasibility of providing a stand-alone fish waste-processing facility that produces and uses clean energy from renewable resources. It serves the commercial fishery and processing plants (7 land-based processing facilities, 3 floating processing facilities and several smaller independent seller/operators) and the community of Naknek, King Salmon, and South Naknek, Alaska. It is a model plant that, when proven successful, will be recreated throughout the fisheries of the State and the nation, and the world. This facility serves the ecology and the economy as it provides supplemental clean energy from renewable sources to the locally owned cooperative energy association. This energy counteracts the drain on the power grid during the fish processing season – which is what creates the drain. In short, this model plant and its subsequent generations are usage neutral. A wonderful and significant side-benefit of this proposed facility is that it utilizes the approximately 30-40% waste of fish products currently being dumped into the environment as waste. While this waste is generally bio-degradable and may not always be environmentally unfriendly, it represents a huge waste of resources; resources that required energy to obtain; resources that could be (and, now, will be) transformed into fuel (and other useful and healthy value added produ cts) instead of simply being dumped back into the environment as garbage. This type of facility need not be a “highly profitable” business in the traditional sense in order to be highly beneficial to the local economy and, eventually, the world economy. While providing supplemental clean energy fuel, it reduces unnecessary waste with its inherent potential harm to the environment. Even though it may be argued that such potential harm is negligible, such waste and potential harm, no matter how slight offends the sensibilities, especially when it is unnecessary waste of environmental products (fish) which, in this case, also happen to be living creatures – and particularly when the alternative is transforming such waste into useful by products including clean, Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 5 of 17 9/3/2008 supplemental energy. Bristol Bay Borough and Naknek Electric Association have joined in this responsible and cooperative scientific effort in the largest sockeye salmon fishery in the world to perform this study and assess the initial, as well as its ultimate, practicality and profitability of such a facility. The creation of this facility carries with it an opportunity for the local population, including the indigenous native population, to operate a model business that produces clean energy and healthy, useful products as it achieves an ideal of Native American traditionalists and Green Planet idealists: Self sustaining, environmentally friendly production – with no waste. 1) Market Issues – This study will prove that there is a huge future need as well as adequate demand currently for the energy (and the value added products) produced and conserved by this facility. This facility will serve as a model of a clean renewable energy production and conservation and the reduction of waste of environmental products (fish) which, as stated are also living creatures. 2) Organizational Issues – This project combines the skills and talents – and idealistic objectives – of technical and scientific communities with the local workforce and values. This facility can and will be staffed and managed to a significant extent by qualified locals. The feasibility study will demonstrate how that will be done effectively and profitably. 3) Technical issues – The equipment and technology needed – where it can be obtained – cost of technology and equipment – when it can be operational – etc. will be determined by the feasibility study. There will be extensive study into best practices to deal with the amount of possible waste to be processed and disposed of according to regulatory, practical, and ideal (e.g. ecological) requirements. 4) Financial issues – Start up costs – operating costs – revenue and energy projections – sources of financing – profitability analysis – etc. are impossible to determine until the feasibility study is complete. The feasibility study is what will determine and propose the processes, resources and equipment necessary to create the final products and services to be produced. The ideal objective of our facility is to produce clean energy from fish waste to reduce to zero the waste produced in processing fish – and operate from its own clean energy produced from such waste (which will then no longer be considered “waste”). We collect undesired fish processing waste from cooperating commercial processors and render it into value added products and resources. In so doing, we use as much as possible only renewable sources of energy particularly those created or released in commercial fish processing. That ideal objective achieves the high standard of Native American traditionalists and Green Planet idealists: No waste – and no harm to the environment. In reaching that ideal objective, we produce and utilize only clean energy from renewable sources such as fish oil biofuel rendered from fish processing and energy obtained by harnessing wind and solar power in a cogeneration situation. 1-100% of the fish processing waste is cost-effectively or profitably converted to fish oil Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 6 of 17 9/3/2008 and fish pellets and other value added products and 2-100% of the fuel is cost effectively produced from renewable energy sources (specifically fish oil, biofuel, wind and solar) Our practical objective is to approach the ideal objective ever closer until the ideal is achieved – however long that takes. The practical objective in its first phase – that justifies the initial human effort and financial cost of creating and operating the facility is considered successfully accomplished as… 1-[?]% of the fish processing waste is cost-effectively or profitably converted to alternative or supplemental fuels and value-added products. and 2-[?]% of the fuel used is from renewable energy sources (specifically fish oil, bio-fuel, wind and solar). What are the percentages [?]. That will be determined by the feasibility study. The study will also determine where this facility should be located and how. This facility is created and developed with the end in mind of organizing techniques and technologies and proceeding with processes that smaller fish processing plants can share and larger plants can share or build. Further, the physical, financial and human resources management systems that are created and established can and will be duplicated and promoted through written and spoken mediums, convention and association presentat ions, study publishing, consulting, etc. This is a first-cut look at these issues. We have examined carefully the relevant facts and related experiments, both successful and unsuccessful, already available to us. We have discovered that nearly every significant technology and resource has been discovered and utilized to some extent. This is an effort to bring all such techniques and technologies together into an operating facility. The Bristol Bay fishery is renown throughout the world and would be the best location for a leading trend to be set as a model. It is clear that this feasibility study is an excellent investment and is likely to achieve a profitable, earth friendly, payoff within the first year of operation – and will move ever closer to its ideal goal until it is at least 99% achieved – likely within the decade, perhaps sooner. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 7 of 17 9/3/2008 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. The cost of the feasibility study, conceptual design and resource assessment is $100,000. This grant application is for $75,000 with a 25% ($25,000) match. $20,000 will be contributed by the Bristol Bay Borough as an in-kind use of Borough employee Yvonne Kopy’s time and knowledge, and her travel expenses, and $5,000 will be invested in in-kind time and effort by the personnel and/or physical resources and facilities of Naknek Electric Association (NEA), the local non-profit energy co-operative sponsoring this project. The feasibility study will include detailed assessment of the technical, economic, financial and operational and political/social viability of the project. It will include assessment of available and necessary equipment that has already been proven viable and successful (pre-test is unnecessary). It will also include community, government, and business input necessary to determine the final design and location of the facility. Project Cost Summary The request for funding at this time only includes the cost for the study as the project cost (design, engineering, and construction) is determined by the feasibility study. 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. Each of the 7 current land based processors in Bristol Bay maintain and operate their own waste removal system while processing millions (29,000,000 in 2008) salmon per season. On average, 30% of the whole fish is wasted during the fillet process. This waste is ground up then pumped back into to the Naknek River as slurry and “grey water”. There are also several smaller independent operators – “mom & pop” processors – that require a means to remove their waste product – a means that is often not easily or readily available to them, which can result in the inappropriate or even illegal disposal of fish waste. It is a fact that the Bristol Bay Borough has a public fish grinder located at the Port of Bristol Bay to provide this service to the community. However, the grinder was built to server only the subsistence fishers and is insufficient to the current needs and demands of the business community. When the machine breaks down, it is often idle for several days, leaving the independent operator without a means to dispose of their waste product. The waste is then left to ferment in the summer weather – motivating inappropriate dumping and related fines and penalties. During the fishing season the consumption of energy in Bristol Bay Borough spikes – Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 8 of 17 9/3/2008 actually it increases tenfold – which taxes the Naknek Electric Association to its limit. We anticipate a change – an imminent change – in the statutes relative to the permitting process for discharge of seafood processing waste. Assuming this model is successful, this facility – and future similar facilities – will accommodate the anticipated mandatory changes in the processing of fish waste without additional strain on existing energy systems. Any village no matter how small or remote will then be able to adhere to the enhanced fish waste disposal requirements without additional strain, or actual overload, of their electric power facility. Much of rural Alaska depends on diesel power for their energy needs. More than 28 million gallons of fossil fuel are currently used for power production annually (at the writing of this proposal the local price for diesel is approximately six dollars per gallon). This facility would eventually allow the villages with fish processing plants to adhere to the new mandates without increasing their need for diesel fuel . The benefit to the Bristol Bay Fishery is financial gain from off-loading their cost and liability in adhering to the regulations governing fish waste removal. The benefit to the State of Alaska is that this model could easily be scaled to fit any fishing village anywhere in the state. Reducing the current approximately 30-40% waste to close to 0% waste and creating a renewable clean energy source (and value added products) is easily worth the investment of state grant monies. 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.) $100,000 2.5.2 Grant Funds Requested in this application. $ 75,000 2.5.3 Other Funds to be provided (Project match) $ 25,000 2.5.4 Total Grant Costs (sum of 2.5.2 and 2.5.3) $ 75,000 2.5.5 Estimated Benefit (Savings) $ 200,000 - inestimable 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.) $ 200,000 [Reduction in need for permitting & reduction of energy costs & increase of energy resource.] Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 9 of 17 9/3/2008 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. Tom Cantrell is the author of the grant. He will also manage the feasibility study and oversee the project. Cantrell has extensive knowledge and experience in technical writing and management and enhancement of the main resource that brings this project success – both long and short term – in creating resource-producing and resource- conserving systems and organizations. What is that main resource? The human resource. People. Cantrell is an expert writer, negotiator, and public communicator with experience working with native cultures and enterprises. He understands individual motivations and how they are affected by their community values and world views. He has the inherent and trained ability to take uncommon concepts and reduce them to common language, so that everyone involved, regardless of culture and background understands and supports valuable projects. With a 36-year career in Human resources management and communication, Cantrell keeps all individuals involved focused enthusiastically on idealistic, yet realistic, project goals such as stated in this funding request. He will be able to champion this project across the state and nation. Yvonne Kopy is the primary consultant on this project. She identifies, defines, and maintains the historical and community purpose and perspective of this and related projects. Because she is a respected and appreciated local representative of this project, she administers and/or coordinates the necessary surveys and studies and political, social and business communications. Kopy is one most apt to get honest answers and accurate information from both processors and fishers – and understand the answers and ramifications of the information she gets. She is well versed in the tempo of the business and social community. She has extensive knowledge of the Borough and the Bristol Bay fishery. She has earned the respect of local and state government leaders. Kopy wrote the Bristol Bay Borough Comprehensive Plan and Bristol Bay Coastal Management Plan, both of which involved tremendous community input and cooperation. In addition, she recently completed the funding package for the construction of the Port of Bristol Bay Dock Expansion Project which will double the capacity of the existing structure. She has obtained over $13,500,000 in private investment in the region. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 10 of 17 9/3/2008 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.) Work will begin immediately on the feasibility study – it is fact already begun – with the objective of completing the study by the spring of 2010. It is important to realize that nearly each individual aspect of this project has already been applied, tested and proven in some practical way. Kodiak has a cooperative facility processing fish waste into fish oil and fish pellets. Dutch Harbor has a facility that uses fish oil bio-diesel to supplement the energy used in their fish processing, Juneau hosts a floating processing facility which combines diesel and fish oil into bio-diesel. Most of the experimental research is, therefore, done by the Alaska Energy Authority and the University of Alaska. Other research is already underway. Our project simply gathers and compiles separate elements into a processing facility whose aim is solely to serve Bristol Bay’s energy needs as it reduces waste to (ideally) 0% producing alternative fuel and related value-added products in a internationally recognized arena thereby setting the model for statewide and most likely international duplication. 3.3 Project Milestones Define key tasks and decision points in your project and a schedule for achieving them. Investigating/Compiling Research 3 months Community & Processor Surveys 3 months Financial Assessment 4 months Permitting requirements 5 months 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. Cantrell Communications and Kopy will work with the University of Alaska Center for Economic Development, the Alaska Energy Authority, and Cora Crome, Governor’s Fishery Advisor, to obtain all necessary and current information as to who, what and where the segments of this process are being done. We will conduct interviews to learn about each piece and determine best practices for creating and establishing each element of the process our facility provides. There will be extensive time spent meeting with the 13 processors located in the Bristol Bay Borough as well as the other processors in the fishery and throughout the state (and even in other parts of the nation – and the world; remember this is no small or insignificant project) to understand how to best serve their needs. This has already begun. These processors so far include: Trident Seafoods, Inc., Yardarm Knot Seafoods, Inc., Ocean Beauty Seafoods, Inc., Icicle Seafoods Inc., Snopac Seafoo ds Inc, Alaska General Seafoods Inc., Baywatch Seafoods, Leader Creek Fisheries, Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 11 of 17 9/3/2008 Norquest Seafoods, North Pacific Seafoods, independent operators and fishers and etcetera. Cantrell Communications, University of Alaska Center for Economic Development, and the University of Alaska have joined their independent specialties into a powerful team. The Center for Economic Development has historically been recognized as the voice of successful economic development in the state and has authored several feasibility studies regarding various segments of the fishing industry. They, also, have direct access to the Institute of Economic & Social Research (ISER) located at the University to obtain consult and advice. The University of Alaska has agreed to conduct the scientific research necessary to the study. Cantrell Communications will compile the information and publish the study. Thomas Cantrell is a writer and communication specialist. He creates written and spoken communications that connect and interconnect with people at all levels and types of education, experience and cultural and national background. He has authored many policy, procedure and performance management systems that create , manage and enhance an indigenous as well as mainstream workforce that is sustainable and secure. 3.5 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. Quarterly reports will be filed identifying expenditures and progress narrative that compare the work accomplished with the time line established in the grant. Any delays or changes would be discussed as soon as they are realized to obtain guidance from the authority. 3.6 Project Risk Discuss potential problems and how you would address them. Cost overruns. These are a potential issue with any project but, because most of those involved in this project have been involved from the beginning, over-runs are not likely. Lack of participation in the surveys. This will be avoided because of the participation of the Bristol Bay Borough employee who has developed relationships of trust with the processors. She has lived in the community for a number of years and has always worked in a respected public position. She is known and trusted throughout the fishing community; for example, she worked with the fishers and processors and the community at large to gain the funding for the dock expansion project which benefits the processors and fishers. 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 Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 12 of 17 9/3/2008 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. Since this is a feasibility study, and not yet an established funded project, this information is dealt with in previous sections. Our available energy resource is fuel generated from 52,000,000 lbs of fish waste and the power available from Naknek Electric. There are no pros or cons. The purpose of this study is to determine best use and apply it in this model facility. 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. Naknek Electrical Association operates 10 Diesel Engines with capacities that range from .4 megawatts (MW) up to 1.3 MW each in a 10.3 MW Plant. The population of Bristol Bay Borough swells from 1000 to upwards of 10,000 each summer during the salmon season. During that time, Naknek Electrical Association (NEA) pressed to operate at maximum capacity. There are 7 active land based onshore fish processors and only 4 of them receive 100% of their power from NEA, if the others chose to purchase power from NEA they would be denied. The connected plants continue to expand and NEA has managed to keep up with their power demands, but they would not and could not accept another processing facility to provide power for. 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. As explained above, for the fishing season, NEA is operating at 100% capacity. If the Alaska Department of Environmental Conservation (DEC) mandates more exten sive processing of fish waste which requires more power, that could overload the system. It has been decided that the Environmental Protection Agency will relinquish control to the DEC in November 2008.We know that there will be changes in the permitting p rocess and requirements. To avoid inevitable brown outs pr power blackouts the Bristol bay Borough and NEA have stepped forward to mitigate the problem through this feasibility study and by building and operating the necessary facility. 4.2.3 Existing Energy Market Discuss existing energy use and its market. Discuss impacts your project may have on energy customers. This project would protect the customers and owners of NEA by providing an alternative Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 13 of 17 9/3/2008 for processing the fish waste which would not tax the system already in place. 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 This is discussed in the beginning sections of this grant application. Bristol Bay Borough has zoning ordinances and a coastal management plan which will require permits. Since they have made the in-kind contribution of their employee, Yvonne Kopy, obtaining these will not present an obstacle. Appropriate EPA or DEC permits etc. will be obtained in the course of events. As for the environmental issues involved, Steve Morstad, Senior Fishery Biologist for Alaska Department of Fish & Game has been involved in the initial discussion and planning of this project. He didn’t perceive any environmental hazards or obstacles. In fact this process will relieve environmental waste and its attending hazards. System design will be determined by the study. 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 feasibility study will identify at least 3 possible sites for the facility. The land owners will then be approached and a land deal negotiated. It was suggested by the Borough Assembly that first consideration for site location be the Bristol Bay Borough industrial park, newly created across the street from the Port of Bristol Bay. If this site is acceptable, it obviously reduces the cost of the project because the land is owned by the Borough and negotiation issues and other potential obstacles for land use and site development will no longer exist. 4.3.3 Permits Provide the following information as it may relate to permitting and how you intend to address outstanding permit issues.  List of applicable permits  Anticipated permitting timeline  Identify and discussion of potential barriers Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 14 of 17 9/3/2008 The chosen location of the facility will determine which permits are required. If the facility is located on the water then there will be a need for an Army Corp of Engineers Permit which could take up to 4 months to obtain. At the same time a coastal review should be begun because any location in the Borough would require the review to determine if a permit is necessary and this process could take up to 60 days. In addition a Bristol Bay Borough Site Development Permit is necessary and can be obtained in 30 days. 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 The site will be chosen so as to minimize any environmental or negative land use issues. The purpose of the community survey is to assess what the community sees as a viable location. This will minimize barriers and constraints from the community and individuals potentially impacted. We are aware of land development or coastal managemen t constraints and relevant individual citizen special interest and community concerns and issues. This project will be developed to be consistent with both the Bristol Bay Borough coastal management plan and the comprehensive plan. 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 Proposed new system costs are unknown at this time. The cost of the feasibility study is $100,000.Total project cost – including construction, Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 15 of 17 9/3/2008 etc. is unknown at this point. That is part of the purpose of the feasibility study. 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 To be determined by the study. 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 energy produced/released will be added easily to Naknek Electric’s power grid. 4.4.4 Cost Worksheet Complete the cost worksheet form which provides summary information that will be considered in evaluating the project. See attached form 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. Needs to be written when the feasibility study is complete. 4.4.6 Analysis and Recommendations Provide information about the economic analysis and the proposed project. Discuss your recommendation for additional project development work. The feasibility study will address the economics of this project and determine whether to proceed with the project. 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) Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 16 of 17 9/3/2008  Discuss the non-economic public benefits to Alaskans over the lifetime of the project Other than what has already been discussed earlier in this grant application, the benefits will be determined as the feasibility study progresses. This is a project designed to relieve the stress on an already over taxed energy plant while developing a model for other users. It will be duplicated throughout the state and in other countries. 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 The cost of the feasibility study, conceptual design and resource assessment is $100,000. This grant application is for $75,000 with a 25% ($25,000) match. $15,000 contributed by the Bristol Bay Borough as an in-kind use of Borough employee and $5000 for her travel budget – and $5,000 will be invested in in-kind time and effort by the personnel and/or physical resources and facilities of Naknek Electric Association, the non-profit energy cooperative that is sponsoring this study. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 17 of 17 9/3/2008 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 - 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 Signature Title Date