HomeMy WebLinkAbout10 Nov 08 AEA Transmittal Letter
10 November 2008
Alaska Energy Authority
813 West Northern Lights Blvd
Anchorage, AK 99503
Attn: Mr Butch White
RE: AEA-09-004- Renewable Energy Grant Application
Dear Mr White,
Kenai Winds LLC is pleased to respond the Alaska Energy Authority solicitation to assist
with the realization of Renewable Energy Projects to be located within the State of Alaska.
Our 15-18 Megawatt wind farm will be a landmark project for the State, one that brings
significant public benefit and reinforces an important Kenai area industry. Our wind farm has
been under development for nearly two years and we are beginning our Phase 3 efforts with
an eye towards operation in the Summer of 2010. Our project is ideally located in a heavily
industrial area, ensuring that the project will enhance the overall efficiency of the Alaska
energy grid. By producing electric power where electric power is actually needed, we reduce
the need for new construction of power lines, and we also reduce the energy losses
associated with long distance and underwater transmission.
The Kenai Winds plant is ready to move forward in Phase 3 immediately. We have consulted
with permit authorities and local officials. Due to the siting adjacent to an operational refinery
and a recently closed chemical plant, we reduce the need to disturb the natural environment
of the area with the construction of supporting infrastructure. As part of our demonstrated
public benefit, we intend to sell electric power to the Tesoro Kenai refinery, which is the
largest industrial employer on the Kenai Peninsula. Due largely to the lack of availability and
the cost of natural gas in that area, industry has struggled. By providing that refinery with a
stable renewable supply of electric power, Kenai Winds enhances the long-term economic
prospects for the region. A letter from the Kenai Peninsula Borough Mayor, included in the
appendices to our application, reflects this viewpoint.
Kenai Winds has been developed by BQ Energy, the leading developer of wind farms at
industrial sites in the nation. Phase 1 and Phase 2 development work have been entirely
paid for by BQ Energy, and have involved supporting stakeholders throughout the Alaska
energy industry, Tesoro, Homer Electric, and the US wind industry in general. Letters of
participative support from BQ Energy, Homer Electric and Tesoro are included in this
submittal.
As we have talked to stakeholders in Alaska, they have reacted curiously to our siting a wind
farm at an oil refinery. In a State where the “oil industry” has seen record profits, it is
interesting to consider this siting. The distinction between the “oil producing” industry and the
“oil refining” industry is important to note. Oil refineries like the Tesoro Kenai facility have
seen the cost of their raw material rise by record amounts this year. During the development
of this project Tesoro has seen their stock value decline by 75% and has seen their
neighboring plant in Kenai (Agrium fertilizer) permanently close their plant due to energy
costs and supply. Although the Kenai Winds project does not solve all these matters, it is an
important step in the direction of perpetually secure, local and economic energy supply for
Alaska business.
Kenai Winds LLC
c/o BQ Energy
20 Jon Barrett Road
Patterson, New York 12563
USA
1 845 228 3477
paul.curran@bqenergy.com
To date with the assistance of all stakeholders we have conducted a one year (so far) on site
meteorological study, contacted appropriate agencies, conducted layout studies, completed
MOU-level agreements for land use, power sales and economic viability, and of course
surveyed the turbine supply market. We have much to do still, but we are comfortable that
we can complete Phase 3 and construct the Kenai Winds facility in the Summer of 2010.
Kenai Winds will be located along the coastal road in an area of the State that is accessible
to anyone. Many communities and schools in Alaska need to know more about wind energy.
The stakeholders in Kenai Winds all recognize that sharing our experience and our
knowledge base with the public is an important part of Kenai Winds.
Kenai Winds LLC is a special purpose member managed Delaware limited liability company
formed in order to finance this project. It is registered to do business in the State of Alaska.
At present, BQ Energy LLC is its sole member. As such, the corporate approvals requested
by the AEA are offered by BQ Energy in its letter of support contained herein.
It is challenging to develop a wind farm in any location. In Alaska, it appears to be more
challenging than in other due to the lack of a Renewable Portfolio Standard, the size of each
utility, the instability of the power grid and the general remoteness. Kenai Winds is not
located in the windiest location in the State. However for a wind farm, Kenai Winds is located
in the best location in Alaska. We welcome the support of the Alaska Energy Authority for
this exciting near term sustainable energy facility.
Perhaps the most important message of our submittal is that we are proud of our work and
want to ensure that this submittal will be clearly understood by the AEA and your evaluation
committee. We understand that the time allotted for evaluation is extremely short and that
the committee will have difficulty absorbing all submitted information. Accordingly, we
request that representatives of Kenai Winds be permitted to make a short 30 minute
presentation to the evaluation committee on this submittal, and allow an equal (or greater)
amount of time for questions and discussion. Although such a presentation would require
some effort in scheduling, we think that such discussion is critical. We will contact the AEA to
attempt to set a mutually acceptable time and date.
Paul F Curran
Managing Director