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Anchorage MLP and UAA Heat Recovery App
AEA 09-004 Grant Application Made by Anchorage Municipal Light & Power & University of Alaska Anchorage For An Energy Conservation Project That Replaces Existing Boilers with Heat Recovery Equipment & Displaces Less Efficient Turbines with More Efficient Turbines For The Benefit of Alaska November 10, 2008 Executive Summary This grant will facilitate energy infrastructure development that benefits all Alaskans. Education and health care are services universally demanded by people in the state and together with Anchorage Municipal Light & Power these institutions, University of Alaska Anchorage and Providence Health & Services, serve a broad community. As a government institution and a non-profit organization they are chartered to serve their community and this grant will help them deliver those services more economically and with less impact on the natural environment. This grant allows the institutions to replace old boiler equipment with boilers that can recover heat wasted in the electric generating process. It also allows ML&P to develop more efficient generating equipment and place it where it can help reduce the cost of higher education and health care. (Two objectives at the top of our national agenda.) The request is for $35 million. The total cost of the project is estimated to be $55 million and additional investment will be made by all three organizations to improve the efficiency and reliability of the energy infrastructure that supports over 2.5 million square feet of space. This project meets the goals of renewable energy through conservation. It delivers energy with less natural gas consumption, less pollution and at a lower cost. AEA 09-004 Grant Application i 11/10/2008 AEA 09-004 Grant Application i 11/10/2008 Table of Contents Executive Summary .....................................................................................................................................i Laying the Groundwork .............................................................................................................................1 UMED District Green Resolution..............................................................................................................2 SECTION 1 – APPLICANT INFORMATION........................................................................................6 SECTION 2 – PROJECT SUMMARY.....................................................................................................8 Provide a brief 1-2 page overview of your project..........................................................................8 2.1 PROJECT TYPE.................................................................................................................................8 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..............8 2.2 PROJECT DESCRIPTION .................................................................................................................8 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......................8 2.2 PROJECT BUDGET OVERVIEW ....................................................................................................8 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.........................................................................................................................8 2.4 PROJECT BENEFIT ..........................................................................................................................9 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.........................................................................................................................................9 2.5 PROJECT COST AND BENEFIT SUMARY ...................................................................................9 SECTION 3 – PROJECT MANAGEMENT PLAN ..............................................................................10 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...................10 3.1 Project Manager ...............................................................................................................................10 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............................................................................................10 3.2 Project Schedule...............................................................................................................................10 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.).................................................................................10 3.3 Project Milestones ............................................................................................................................10 Define key tasks and decision points in your project and a schedule for achieving them......................10 3.4 Project Resources .............................................................................................................................11 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.............................................................11 3.5 Project Communications ..................................................................................................................11 Discuss how you plan to monitor the project and keep the Authority informed of the status................11 3.6 Project Risk ......................................................................................................................................12 Discuss potential problems and how you would address them...............................................................12 SECTION 4 – PROJECT DESCRIPTION AND TASKS.....................................................................12 4.1 Proposed Energy Resource ..............................................................................................................12 Describe the potential extent/amount of the energy resource that is available.......................................12 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............................................................................................12 4.2 Existing Energy System ...................................................................................................................13 4.3 Proposed System ..............................................................................................................................15 © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application ii 11/10/2008 4.4 Proposed New System Costs (Total Estimated Costs and proposed Revenues)..............................17 SECTION 5– PROJECT BENEFIT .......................................................................................................19 SECTION 6 – GRANT BUDGET ...........................................................................................................20 SECTION 7 – ADDITIONAL DOCUMENTATION AND CERTIFICATION ................................21 A. Resumes.....................................................................................................................................21 Michael W. Smith ...................................................................................................................................22 Eugene Ori ..............................................................................................................................................22 Richard Beam..........................................................................................................................................23 Robert Wilson .........................................................................................................................................24 Doug Maust .............................................................................................................................................25 Brian Fitzgerald ......................................................................................................................................26 Brian G. Hoefler, P.E..............................................................................................................................27 B. Cost Worksheet per application form Section 4.4.4 ......................................................................29 C. Grant Budget Form per application form Section 6.......................................................................29 D. An electronic version of the entire application per RFA Section 1.6 ............................................29 E. Governing Body Resolution per RFA Section 1.4.........................................................................29 University of Alaska Resolution .............................................................................................................30 PRELIMINARY ADMINISTRATIVE APPROVAL ............................................................................31 F. CERTIFICATION .........................................................................................................................37 . AEA 09-004 Grant Application 1 11/10/2008 Laying the Groundwork Reclaiming heat from electricity production is a well known means of conserving energy. It is used in many industries where thermal energy is needed. As the price of fossil fuel increase, economics improve and the chance of using reclaimed heat improves for hospitals and universities. The participants in this project have worked hard to make what seems like common sense happen. They have invested in understanding their costs and ways to maximize the value of construction dollars. This application presents their work. It illustrates that that team work between a utility and its customers lowers the cost of operations. The team has investigating how to maximize the use of the energy stored in natural gas and how to position the generators and boilers to maximize their value to the two campuses. Moreover, they have teamed to improve the environment in Anchorage. Less fuel consumed to do the same job reduces air pollutants and green house gasses. Independent study, meeting to find common ground and reaching out to the community is the path this group has taken. First each member of this group looked at how to do a project independently. Then they assembled to hear each others goals and understand each others working environment. Next, they committed to working together and that document is included with this application. Their last step was to set goals for the UMED District. The grant opportunity offered by the State of Alaska will make a meaningful difference. It will have a direct benefit to two of the largest institutions serving the public good in Anchorage, the University of Alaska Anchorage and Providence Health & Services. And it can make that happen through a public utility. The Application can be found few pages into this document, but we ask you to take a minute to review the documents that led up to this group committing to taking this step. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 2 11/10/2008 UMED District Green Resolution PARTICIPATION AGREEMENT BETWEEN THE MUNICIPALITY OF ANCHORAGE PROVIDENCE ALASKA MEDICAL CENTER UNIVERSITY OF ALASKA ANCHORAGE ALASKA PACIFIC UNIVERSITY ANCHORAGE SCHOOL DISTRICT GREEN STAR SOUTHCENTRAL FOUNDATION ALASKA PSYCHIATRIC INSTITUTE AND ALASKA NATIVE TRIBAL HEALTH CONSORTIUM FOR U-MED GREEN DISTRICT ANCHORAGE, ALASKA This Participation Agreement (“Agreement”) is entered into this 1st day of October 2008, by and among the Municipality of Anchorage (“MOA”) acting through the Office of the Mayor; Providence Health & Services-Washington dba Providence Alaska Medical Center (“PAMC”) acting through its Alaska Region Chief Executive Officer; University of Alaska Anchorage (“UAA”) acting through the Office of the Chancellor; Alaska Pacific University (“APU”) acting through the Office of the President; Anchorage School District (“ASD”) acting through the Office of the Superintendent; Green Star acting through the Office of the Executive Director; Southcentral Foundation (“SCF”) acting through the Office of the President and Chief Executive Officer; Alaska Psychiatric Institute (“API”) acting through the Office of the President; and Alaska Native Tribal Health Consortium (“ANTHC”) acting through the Office of the Chief Executive Officer for the purpose of collaborating in creating an environmentally sustainable district in Anchorage, Alaska to be known as the “U-Med Green District”. The parties to this Agreement intend to collaborate and work together to try to optimize the U- Med Green District’s environmental sustainability practices by fostering working relationships among its institutions, the MOA and other partners such as Green Star to coordinate, complement and supplement one another’s planning, research and implementation of environmentally sound and sustainable practices. The parties to this Agreement agree to share nonconfidential information and strategies for identifying best practices and to work collaboratively to implement practices as appropriate. Goals (Year One) 1. Each party to this Agreement will authorize a Green Council member to represent it on the U-Med Green District Council (the “District Council”). 2. The District Council will convene to develop an advisory framework and benchmarks for each party to individually and/or collectively practice and improve waste reduction, energy conservation and pollution prevention efforts. 3. The District Council will: © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 3 11/10/2008 a. Identify those priorities and activities that are common to the U-Med Green District organizations and are practical to implement. b. Identify the potential benefits to said organizations and the MOA. c. Identify when it is appropriate to jointly pursue these priorities and activities. d. Identify the MOA’s and other parties’ roles to advance these priorities and activities. e. Report the Green District Council’s findings back to the Council’s organizations, MOA and the Anchorage community, with the intent to then advance the U-Med Green District’s findings. 2. The MOA will participate as an active member in the U-Med Green District Council to support the District’s efforts and to then utilize lessons learned throughout Anchorage. Terms of Agreement This Agreement will commence upon the date of the final signature of this document and shall remain in effect until the feasibility study is completed or [date], whichever comes first, unless otherwise terminated earlier as provided in this Agreement. Any party to this Agreement may terminate its involvement hereunder and withdraw from this process by providing no less than thirty (30) days prior written notice to the other parties to this Agreement. Prior Approval Any amendment, revisions, addenda, extensions, or reaffirmation of this Agreement must be in writing and be approved and signed by the Mayor of the MOA and the responsible parties of each institution listed below. Miscellaneous Nothing in this Agreement gives, is intended to give, or shall be construed to give or provide any benefit or right not held by or made generally available to the public, whether directly, indirectly or otherwise, to third persons unless such third persons are individually identified by name herein and expressly described as intended beneficiaries of the terms of this Agreement. This Agreement constitutes the entire understanding between the parties with respect to the subject matter described herein and all prior or contemporaneous oral or written communications, understandings, or agreements among the parties hereto with respect to such subject matters are hereby superseded in their entirety. Signatures In Witness hereof, the parties hereto executed this Agreement on the date(s) set forth below, For the Municipality of Anchorage For Providence Alaska Medical Center Mayor Chief Executive Officer Signature: By____________________________ Signature: By________________________ Name: Mark Begich Name: Al Parrish Date: ________________________________ Date:_______________________________ For University of Alaska Anchorage For Alaska Pacific University Chancellor President Signature: By _________________________ Signature: By________________________ Name: Fran Ulmer Name: Doug North Date: _______________________________ Date: _______________________________ For South Central Foundation For Anchorage School District President and Chief Executive Officer Superintendent Signature: By _________________________ Signature: By________________________ Name: Katherine Gottlieb Name: Carol Comeau Date: _______________________________ Date: _______________________________ For Alaska Psychiatric Institute For Green Star of Alaska Chief Executive Officer Executive Director Signature: By _________________________ Signature: By________________________ Name: Ron Adler Name: Sean Skaling Date: _______________________________Date: _______________________________ (Note: The document was signed but that copy was not available at the time of this printing.) © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 5 11/10/2008 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. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 6 11/10/2008 SECTION 1 – APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) University of Alaska Anchorage (UAA) and Municipal Light & Power (ML&P) Type of Entity: University of Alaska Anchorage is a Government Entity Municipal Light & Power is an Electric Utility holding a certificate of public convenience and necessity under AS 42.05 Mailing Address University of Alaska Anchorage 3890 University Lake Drive, Suite 110 Anchorage, Alaska 99508 Attn: Michael W. Smith Municipal Light & Power 1200 East 1st Avenue Anchorage, Alaska 99501 Attn: Eugene Ori Physical Address Same Telephone UAA: 907-786-4912 ML&P: (907) 263-5339 Fax UAA: 907-786-4901 ML&P: (907) 263-5349 Email UAA: anmws3@uaa.alaska.edu ML&P: oriEA@muni.org 1.1 APPLICANT POINT OF CONTACT Name UAA: Michael W. Smith ML&P: Eugene A. Ori Title UAA: Director Facilities Planning and Construction ML&P: Assistant Generation Manager Mailing Address University of Alaska Anchorage 3890 University Lake Drive, Suite 110 Anchorage, Alaska 99508 Attn: Michael W. Smith Municipal Light & Power 1200 East 1st Avenue Anchorage, Alaska 99501 Attn: Eugene Ori Telephone UAA: 907-786-4912 ML&P: (907) 263-5339 Fax UAA: 907-786-4901 ML&P: (907) 263-5349 Email UAA: anmws3@uaa.alaska.edu ML&P: oriEA@muni.org 1.2 APPLICANT MINIMUM REQUIREMENTS Please check as appropriate. If you do not to meet the minimum applicant requirements, your application will be rejected. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 7 11/10/2008 1.2.1 As an Applicant, we are: (put an X in the appropriate box) ML&P 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 UAA A governmental entity (which includes tribal councils and housing authorities); Yes 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.) © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 8 11/10/2008 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. Project summary Anchorage Municipal Light & Power (ML&P), Providence Health Systems-Alaska (Providence) and the University of Alaska Anchorage (UAA) are preparing to add new equipment to existing systems to improve efficiency. The existing systems are ML&P’s generating fleet and heat recovery boilers in place of conventional boilers serving Providence and UAA. The new and replacement equipment is contained in a combined heat and power project for the benefit of the three organizations. The Project will contain two or more gas turbine generators each with a heat recovery boiler and a thermal distribution system that will connect Providence Hospital and UAA buildings to the plant. The existing ML&P plant that produces electricity for Providence and UAA currently wastes heat. The existing generating system operated by Anchorage Municipal Light & Power is being expanded and modified to include heat recovery equipment adjacent to the two campuses. The project is based upon the concept and business plan submitted with this application and includes a request for grant funds for a portion of Final Design, Permitting and Construction costs. The project expands the capability of an existing electric generating system with the addition of new equipment and will replace existing equipment that is less efficient than the proposed system. Combined heat and power production improves the fuel efficiency of the current electric generating process by more than 10% and uses waste heat rather than natural gas fired boilers to heat the hospital and campus. This reduces the amount of natural gas consumed at the buildings connected to the system by 100%. The project uses waste heat, conservation and efficiency improvements to meet the definition of a renewable energy project. 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 will be co-located with a planned parking garage on University land, adjacent to and west of Providence Hospital. The project will contain two gas turbine generators each with a heat recovery boiler and a thermal distribution system that will connect Providence Hospital and UAA buildings to the plant. It will serve the UMED district with thermal energy and the exclusive service territory of ML&P with electricity. ML&P, UAA and Providence are involved in the grant project. Other institutions may become involved as thermal customers to the project based upon their own schedule and requirements. 2.2 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 project cost is expected to cost $55 million dollars. The anticipated source of funds are: □ Renewable Energy Fund Grant: $35 million □ Debt secured by purchase agreements with the Project: $20 million ML&P, UAA and Providence have each completed independent, preliminary studies at their own expense and are equally sharing the cost of preparing this grant application. Each believes that a project could be developed that serves their best interest and that the greatest benefit will be achieved by all three parties © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 9 11/10/2008 cooperating to plan, finance and operate a single facility. 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. The benefit for the participants include: □ Providence Alaska and UAA and possibly other UMED district members could reduce their heating costs by over half. For UAA that is over $500,000/year. □ Renew the infrastructure through replacement of equipment that is about 40 years old. □ Efficient deployment of staff and equipment to meet the operational requirements of the three institutions. The benefits to the Environment of Alaska and the Anchorage basin include: □ Reduced Carbon Footprint by nearly 15,500 metric tons CO2 of both campuses by using waste heat for space heating. □ Reduces NOX related to the combustion of fuel by about 60 tons/year. □ Providence is investing to serve as a regional center and this facility improves the viability of critical life support systems in the event of catastrophe. □ A training site for energy system operators and maintenance personnel that enables Alaskans to service and operate state of the art systems throughout the region. 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.) $ 55,000,000 2.5.2 Grant Funds Requested in this application. $ 35,000,000 2.5.3 Other Funds to be provided (Project match) $ 20,000,000 2.5.4 Total Grant Costs (sum of 2.5.2 and 2.5.3) $ 55,000,000 2.5.5 Estimated Benefit (Savings) $ NPV of $4 million $ 36 million NPV in reduced gas purchases. $15 million in UAA boiler replacements $10 million in avoided back-up facility development at Providence 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.) $ 26,000 annually for 15,500 metric tons CO2 at the current market price of $1.75/ Tonmetric on CCX . Reduces NOx by 60 Tons/year © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 10 11/10/2008 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. The project will be managed by: University of Alaska Anchorage 3890 University Lake Drive, Suite 110 Anchorage, Alaska 99508 Michael Smith, Director Facilities Planning and Construction 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.) October 2008 – December 2008: Phase I – Reconnaissance Requirements January 2009 – June 2009: Phase II – Feasibility Analysis and Conceptual Design Requirements July 2009 – December 2009: Phase III – Final Design and Permitting Requirements January 2010 – March 2011: Phase IV – Construction Requirements 3.3 Project Milestones Define key tasks and decision points in your project and a schedule for achieving them. Phase I – Reconnaissance Requirements Milestone 1: Reconnaissance / Complete Grant Application Phase II – Feasibility Analysis and Conceptual Design Requirements Milestone 2: Predesign: Issue Program / Conceptual Design Milestone 3: Issue Schematic Design Phase III – Final Design and Permitting Requirements Milestone 4: Issue Design Development Documents Milestone 5: Issue Construction Documents Phase IV – Construction Requirements Milestone 6: Contractor Mobilized Milestone 7: Utility Piping 10% / Building Earthwork Complete Milestone 8: Utility Piping 25% / Building Footings Complete Milestone 9: Utility Piping 40% / Building Foundation Complete Milestone 10: Utility Piping 55% / Structural Building System 75% © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 11 11/10/2008 Milestone 11: Utility Piping 70% / Building Enclosed Milestone 12: Utility Piping 85% / MEP Equipment On Site Milestone 13: Utility Piping complete / MEP Equipment Hook-up 75% Milestone 14: Interior Finishes 50% Milestone 15: Site Work Complete Milestone 16: Interior Finishes Complete Punch List Milestone 17: Certificate of Occupancy Milestone 18: Commissioning Report 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. University of Alaska Anchorage, Michael Smith, Director of Facility Planning Municipal Light and Power, Eugene Ori, Assistant Generation Manager Providence Health and Services–Alaska, Richard Beam, Director of Energy Management Providence Alaska Medical Center, Robert Wilson Hammel Green and Abrahamson, Inc. Doug Maust, Principal Hammel Green and Abrahamson, Inc. Livingston Slone Architects Tentative Hoefler Consulting Group Permitting, Brian Hoefler, President The project will be developed using a collaborative process between the design team and owner group. For the first stage of design a contractor will be selected based upon qualifications, providing pre- construction services with the design team to establish budget pricing for the Project and subsystems. Construction documents will be prepared for bidding by contractors of a single stipulated sum to deliver the Project. Currently, the University is working with Livingston Slone to develop pre-design architectural concepts of a parking structure that will adjoin this Project. It is considered in this Project’s best interest to include the architectural, structural and civil scope of work for the portion of the building that will contain this Project together with the agreement for architectural services to develop plans and specifications for the garage. The balance of the design work (mechanical and electrical) will be selected separately, based upon qualifications. Construction services will be managed by the University on its property and by Providence on their Property. (The majority of construction is on University Property.) 3.5 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. Hammel, Green and Abrahamson, Inc. will provide quarterly progress reports to the three institutions that are developing the project and they will jointly take the responsibility of commenting on and forwarding those reports to the Authority. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 12 11/10/2008 3.6 Project Risk Discuss potential problems and how you would address them. The project faces the risk of: □ Construction cost over-runs and construction inflation. They will be managed through planned use of the Project Resources as described in Section 3.4, above. □ Operational risk will be insured against normally insurable risks and other risk will be mitigated with redundant equipment and related emergency operating plans. □ The project size is dependent upon forecast thermal loads. They could be under or overstated and cause the project to be either under utilized or oversubscribed. This risk is being addressed by: o 1) Careful analysis of current loads o 2) The ability to serve other institutional customers o 3) The ability to add equipment. □ Fuel price risk is a minimal issue for the project and in the event that fuel costs rise, the project economics improve. SECTION 4 – PROJECT DESCRIPTION AND TASKS • Tell us what the project is and how you will meet the requirements outlined in Section 2 of the RFA. The level of information will vary according to phase of the project you propose to undertake with grant funds. • If you are applying for grant funding for more than one phase of a project provide a plan and grant budget for completion of each phase. • If some work has already been completed on your project and you are requesting funding for an advanced phase, submit information sufficient to demonstrate that the preceding phases are satisfied and funding for an advanced phase is warranted. 4.1 Proposed Energy Resource Describe the potential extent/amount of the energy resource that is available. Discuss the pros and cons of your proposed energy resource vs. other alternatives that may be available for the market to be served by your project. The project uses natural gas energy as its source of fuel and derives its benefit to the community by using that fuel more efficiently than it is today. Natural gas is currently being used by ML&P to generate electricity for the benefit of all of its customers, inclusive of Providence and the University. ML&P is obligated to provide electrical energy services to these customers because they fall within its exclusive service territory. The utility is redeveloping its generating assets and currently has the resources in place to provide electricity reliably. . Enstar has pipe line capacity to meet the current thermal energy requirements of these customers and has recommended that a new high pressure line be installed to serve this plant. The UMED campuses consume 385,000 MCF of natural gas to heat the campus and ML&P consumes approximately 363,000 MCF of natural gas on behalf of the UMED campuses for a total consumption of 747,000 MCF. This project will reduce the consumption of natural gas for the UMED campuses to approximately 400,000 MCF or by approximately 45%. Given that Anchorage is a maintenance area for CO emissions, other renewable fuels such as wood were not considered as a source of heat nor were wind energy because of its intermittent © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 13 11/10/2008 availability. 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. UMED campus buildings use package boiler that are fired with natural gas to meet their thermal energy requirements. Providence fires 150 PSI boilers with natural gas and it uses #2 Fuel Oil to back up its natural gas supply. Oil is used less than 1% of the year. The plant operates at a seasonal efficiency of 80%. Providence Alaska Medical Center (PAMC) uses plant steam for most heating- tasks (including building heat, domestic hot water, laundry services, snow/ice melt systems at building entrances, indirect heating for building humidification. and indirect heating for dietary-steam-kettles), and also directly for process steam for flash sterilization in the Operating Rooms Central Core and the sterilization processes in the Sterile Processing Department. With the exception of Building "A", the entire contiguous main hospital complex relies on steam generated by the central boiler plant located in Building "J" which is situated in the western portion of the facility. High pressure (150 psig) steam is produced by four dual-fuel fired boilers (primarily natural gas-fired, with back-up fuel oil firing available), without the steam being superheated. The plant steam is also distributed at lower pressures (80 psig and 10 psig) through the use of pressure reducing stations. The four high-pressure boilers in use in the central boiler plant are D-type Water Tube boilers: □ Boiler # 3 is a 1974 Keeler Boiler rated at 27,500 lbs steam/hr □ Boiler # 4 is a 1974 Keeler Boiler rated at 27,500 lbs steam/hr □ Boiler # 5 is a 1990 Nebraska Boiler rated at 35,000 lbs steam/hr □ Boiler # 6 is a 2000 Cleaver-Brooks Boiler rated at 35,000 lbs steam/hr □ (The older previous Boilers #'s 1 and 2 have been removed from the plant.) UAA uses natural gas to fire approximately 40 boilers on its campus. The average age of its boiler fleet is greater than 30 years old and beyond their normal service life. The seasonal efficiency of the sum of the boiler plants is about 70%. (The boilers are too small to monitor individual performance.) ML&P meets the13 MW demand for electricity of the UMED District using generating assets across the metropolitan area. The average age of the existing fleet is 40 years and the average plant efficiency is approximately 10,000-11,000 BTU/KWH. The utility is currently planning to replace equipment in its current fleet with a combined cycle plant that will improve efficiency by 15-20% and the generating assets of this facility which will be approximately 10% more efficient than its existing assets for the production of electricity. 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. This Project maximizes the value of the energy infrastructure in the UMED district, while improving energy efficiency by nearly 40%. ML&P has invested in a robust network of generating assets and a transmission and distribution system. It has a sales and service staff in place to operate and maintain these assets. The University has old equipment in many of its buildings that needs to be replaced. It also has two Energy Modules with operating boilers in place. This Project will connect to these Energy Modules and to the other buildings on campus to deliver heat from this Project. It will use the existing Energy Modules for back-up. The University’s new science building at the northwest edge of campus will also have new boilers that are relatively large compared to other buildings on campus. The boilers in the science building will be become Energy Module 3 and be used for back-up with the completion of this project. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 14 11/10/2008 Similarly, the hospital operates a boiler plant and will be maintained as a back-up resource to this Project. This redundancy allows Providence to meet JHACO redundancy requirements and allows the Hospital to serve Alaska as a Regional Trauma Center. 4.2.3 Existing Energy Market Discuss existing energy use and its market. Discuss impacts your project may have on energy customers. The existing market is dependent upon natural gas, oil, and to a limited degree, propane. This project will reduce the demand for natural gas by approximately 315,000 MCF every year and that amount will increase as UAA and Providence grow. It is expected that within the next decade, the price for natural gas in Anchorage will approach market price of natural gas in other markets. For example, in 2008 market price has been as high as $14/MCF and as low as $8.50/MCF, inclusive of transportation for customers served through the Henry Hub. (This example I used since it is commonly used as an indices for pricing gas in Anchorage.) This range of prices exceeds the cost of natural gas in the Anchorage area by 15-100%. Because these two customers and most others in Anchorage rely upon natural gas, conservation is the best way to manage the cost associated with its use and its longevity as a resource. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 15 11/10/2008 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 The Project is planning to use two five megawatt gas turbines to generate power. A natural gas fired duct burner and a heat recovery boiler will be installed In the exhaust stream of each turbine. The Project will be constructed so that it can be expanded to accommodate future load growth on the campus by adding equipment in a similar configuration. The equipment capacity factor is anticipated to be 86% (temperature corrected) in a bottom cycle control mode. This means that 86% of the time, all waste available heat from the turbines will be recovered for use in the UMED district. We anticipate generating 77,000 MWHe of electricity and 51,000 MWHthermal energy for export as a result of result of operating the CHP Plant in a bottom cycle mode. We anticipate generating an additional 34,000 MWHthermal from the duct burners for export. (Parasitic losses are not included in the thermal output numbers, but are accounted for in the efficiency calculations.) The conversion efficiency of the duct-burners is 97% or a 17% improvement over conventional boilers. The improved efficiency is the result of combusting natural gas in the oxygen rich and hot flue gas (excess air) leaving the gas turbines. There are no apparent barriers to the Project. However, electric rates paid to the Project must be approved by the Regulatory Commission of Alaska and all necessary permits must be obtained. The Project believes that the project conforms to all existing expectations required for these approvals. The system integration plan is for the Project to load follow the thermal demand (bottom cycle) on the UMED campus. Because the amount of electric power generation of the Project is small compared to the total generation of ML&P, ML&P will reduce production of electricity at other plants to accept the power generated at the Project. (The power generated at the Project is somewhat greater than the normal consumption of the University and Providence.) There are four parts to the system delivery method for this Project. 1. The fuel for the project will be brought to the site through an Enstar high pressure line that is adequately sized. Fuel oil may be brought to the site by Providence from their storage facilities. 2. Electricity will be delivered to the distribution system to facilities controlled and managed by ML&P. 3. Steam will be delivered by direct buried pipe to Providence’s the main steam header in their existing boiler plant. Providence will maintain and operate back-up equipment to this Project in their boiler room. Condensate will be returned to the Project. 4. Hot water will be heated in steam to water heat exchangers in the Project and piped over Providence Drive in a planned pedestrian bridge. A piping network will be constructed as part of the project to each building on the University campus and to the Energy Modules. The University will maintain back-up facilities in the Energy Modules and the new Science Building. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 16 11/10/2008 Under study is selecting a turbine that can use either propane or fuel oil to back up the natural gas supply. The project is not dependent upon finding an acceptable solution, however, it would provide a more robust energy solution to Providence during emergency events and improve Providence’ ability to better serve the community during a time of need. 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 land is owned by the University and the building for the Project will also be owned by the University. The University has agreed to be part of the Project. 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 Potential significant permits that could be required for the cogeneration project are: □ Air Quality Construction Permit (Alaska Dept. of Environmental Conservation) □ Coastal Consistency Review (Alaska Dept. of Natural Resources/Municipality of Anchorage) □ Flood Hazard Permit (MOA) □ 404 Wetlands Permit (Corps of Engineers) □ Conditional Use Permit (MOA) □ Building Construction Permits (MOA) □ There are also several other routine permits and certifications likely to be required. Anticipated Permitting Timeline □ Pre-permitting activities such as preliminary meetings with regulatory agencies and preparation of permit applications would occur from January 2009 – June 2009. □ Filing of applications, negotiations, and permit receipt would occur from July 2009 – December 2009. Identify and Discussion of Potential Barriers □ Construction within the flood plain or across Chester Creek will present engineering challenges that can be addressed with proper design. Alternatively avoiding construction within the flood plain or across the creek would limit impacts. □ Small turbines are known for producing elevated emissions at low loads. Proper load management should be addressed in the air permit application in order to assure regulators that the facility is designed to operate efficiently. □ If a propane tank is required for backup fuel supply, it may trigger a risk management plan and/or homeland security requirement. It will also need to be addressed during the conditional use permit process. 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 © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 17 11/10/2008 • Archaeological and historical resources • Land development constraints • Telecommunications interference • Aviation considerations • Visual, aesthetics impacts • Identify and discuss other potential barriers □ Threatened or endangered species. USFWS and ADF&G will be consulted to determine whether any threatened or endangered species occur in the project vicinity. If so, nesting or other sensitive sites will be identified to be avoided during construction. □ Habitat, wetlands, and other protected areas. The project is located near Chester Creek and its floodplain. Wetlands and the FEMA floodplain will need to be delineated and if the project is within the boundaries, proper wetlands and habitat protection measures will be required. Ways to avoid the floodplain and wetlands will be considered. □ Archaeological and historical resources. The State Historical Preservation Officer will be consulted. However, archaeological and historical resources are not expected to occur within the project area. □ Land development constraints. The land is zoned PLI (public lands and institutions, which is the same as most of the hospital and university campuses. Installing a small powerplant with cogeneration beneficial uses for the hospital and university should be considered a compatible use. The process for obtaining a conditional land use permit from the Municipality will validate the compatible use. □ Telecommunications interference. There should not be any interference with telecommunications. □ Aviation considerations. Primary airport flight paths are generally not over the UMED district. However, medevac helicopters need direct access to the heliport at Providence hospital. The power plant should not interfere with any helicopter or fixed wing air traffic. □ Visual and aesthetic impacts. Zoning requires visual enhancement landscaping, which will be designed into the project. 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 □ Cost are detailed in the attached business plan. □ In summary, approximately $500,000 has been spent by the three parties to develop Phase 1 information. □ The total anticipated cost for this phase that is directly related to the grant Phases 2-4 is $55 million. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 18 11/10/2008 □ The request for grant funding is $35 million. □ Matching funds include a $20 million loan. Related capital projects not directly associated with the grant application are $13 million for a pedestrian bridge, $3 million for building interfaces and heating system improvements, $12 million for improving the electrical system on Providence’s campus. □ No in-kind investment is being made. □ The planned cost assigned to this project is $55,500,000. 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 □ The Project self funds its O&M cost from operating revenue. In 2009 dollars the cost of Operations and Maintenance is expected to be approximately $1.7 million. □ There is no request for grant funding for operations. Approximately $250,000 (5% of annual cash flow) may be set aside in a Project account to manage operating cash flow. 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 power buyer for the project is ML&P and the revenue is expected to be approximately $5 million annually. □ The thermal energy customers for the project are UAA and Providence and the revenue is expected to be approximately $3 million annually. □ Back-up services may be provided to Providence and the potential revenue is approximately $750,000 annually. Note: The income forecast is based upon rates that all three parties have reviewed and the rates may change in response to discussions between the three parties, the change in price of natural gas (the underlying commodity) and general inflation. The business plan reflects anticipated changes. □ The proposed rate of return from the grant-funded project has been measured in net present value (NPV) after debt service and a discount rate equal to ML&P’s rate of 8.3 percent. The NPV given the assumptions we have made is approximately $4 million. 4.4.4 Cost Worksheet Complete the cost worksheet form which provides summary information that will be considered in evaluating the project. The worksheet is attached. Renewable Energy Fund RFA AEA 09-004 Application Cost Worksheet Page 1 Application Cost Worksheet 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 The Applicant should demonstrate that the renewable energy resource is available on a sustainable basis. Annual average resource availability. 98% 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 Note: ML&P is a part of the railbelt grid. Therefore in speaking with Butch White, we understand that this section can be left blank. Information about the existing boilers at UAA can be provided by the applicant if requested. ii. Rated capacity of generators/boilers/other iii. Generator/boilers/other type 2 at 5 MW plus two boilers at 60,000 lb/hour iv. Age of generators/boilers/other Boilers more than 30 years old on average v. Efficiency of generators/boilers/other About 70% at UAA and 80% at Providence b) Annual O&M cost i. Annual O&M cost for labor $550,000 inclusive of service contract on turbines ii. Annual O&M cost for non-labor $1,920,000 inclusive of plant operators c) Annual electricity production and fuel usage (fill in as applicable) i. Electricity [kWh] 73,000 MWH using 194,000 MWHgas 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] ii. Electricity [kWh] iii. Propane [gal or MMBtu] Renewable Energy Fund RFA AEA 09-004 Application Cost Worksheet Page 2 iv. Coal [tons or MMBtu] v. Wood [cords, green tons, dry tons] vi. Other 35,000 MWHgas 3. Proposed System Design a) Installed capacity 9200 kWe and 2190 BHP b) Annual renewable electricity generation i. Diesel [gal or MMBtu] ii. Electricity [kWh] 7.1 MWH (Conservation) iii. Propane [gal or MMBtu] iv. Coal [tons or MMBtu] v. Wood [cords, green tons, dry tons] vi. Other 51 MWH thermal Recovered Heat 4. Project Cost a) Total capital cost of new system $45,811,683 b) Development cost $9,162,337 c) Annual O&M cost of new system $1.7 Million d) Annual fuel cost $3,677,366 5. Project Benefits a) Amount of fuel displaced for i. Electricity 68,900 MMbtu per year and 1,378,800 MMbtu total ii. Heat 73,900 MMbtu per year and 599,900 MMbtu total iii. Transportation 0 b) Price of displaced fuel $23.67/MMBtu c) Other economic benefits Carbon Reduction 15,020 Mtons CO2/year @ $1.75 /Mt CO2 = $26,285 d) Amount of Alaska public benefits $15 Million avoided capital cost for new boilers on University Campus and more than $10 million potential avoided cost on Providence campus. 6. Power Purchase/Sales Price a) Price for power purchase/sale $52/ MWH Electric and $10.25/MMBTU thermal Renewable Energy Fund RFA AEA 09-004 Application Cost Worksheet Page 3 7. Project Analysis a) Basic Economic Analysis Project benefit/cost ratio JW / DM Payback $4 million NPV @ Discount rate = 8.3% © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 19 11/10/2008 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. □ The manager of the operation will be an ML&P employee. □ An executive committee will oversee the manager and provide policy and investment direction. The committee will be made up of one person from each of the three organizations. The executive committee will be chaired by an independent third party. □ The project currently has three customers: ML&P, UAA and Providence. o The project will sell all of the electricity it produces to ML&P. o The project will sell thermal energy delivered by hot water to UAA. o The project will sell steam and back-up electrical services to Providence. □ The project will purchase gas for the turbines through ML&P and it will be delivered to the site by Enstar. □ The project will purchase gas for the duct burners and it will be delivered to the site by Enstar. □ Licensed Boiler operators will man the plant. □ Service contracts will be secured through competitive selection of pre-qualified companies for the maintenance of sophisticated or complex equipment. □ Training in the facility will be managed through UAA. □ The grant will serve as the cash investment. □ The balance of the cost will be financed and repaid by project revenue. □ Energy rates will be set to encourage conservation and dividends equal to excess earnings after all obligations and reserve funding will be returned to the customers. 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 Project’s cash budget is attached. Currently the plant is fully subscribed and both campuses have growth. The Project is being planned for 100% expansion and new equipment will be added as thermal loads grow. Timing capital investment will be based upon income forecasts related to the sale of thermal energy. 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 □ Potential annual fuel displacement over the lifetime of the evaluated renewable energy project is $36 million. □ Anticipated annual revenue streams for one year of operation in 2009 dollars include: □ The sale of electricity $4 million □ The sale of thermal energy $3 million □ The sale of back-up services $750,000 © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 20 11/10/2008 □ Potential additional annual incentives: None. □ Potential additional revenue streams □ Carbon credits can be sold through a variety of channels or retired. In the CCX their current market value is approximately $26,000. □ Other avoided costs □ Avoided capital investment to replace small boilers on the UAA campus of approximately $15 million. □ Avoided capital investment to construct back-up diesel generator facility by Providence of more than $10 million. □ Reduced fuel purchases in excess of $30 million over the life of the project. The non-economic public benefits to Alaskans over the lifetime of the project □ Air quality improvement □ Reduced demand for locally produced natural gas. □ NOx reduction of 60 tons/year □ More robust power supply for Providence Alaska Medical Center □ Facility to provide technical training 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 more than $200,000 in planning dollars spent individually by the three parties to develop individual plans. Each of the three parties followed that work with a commitment to invest up to $100,000 (total of $300,000) to complete Phase 1 study as defined by this grant process, which also includes preparation and submittal of this application. The Project is expected to cost $55,000,000 for design and construction. The Project is requesting a grant of $35,000,000. The Project will incur approximately $20,000 debt that will be serviced by the Project and will be securitized by long term sales contracts to the three customers. UAA will make an additional investment to connecting existing and new buildings to the system at a cost of approximately $100,000 each for approximately 27 buildings or about $3 million. UAA will make and additional investment to build a pedestrian bridge across Providence Drive at a cost of approximately $13 million which may carry piping over the road. Providence Hospital will modify its electrical system and other engineered systems to meet the objective of being a regional trauma center at the cost of approximately $12,000,000. The three parties to this project are committed as customers of the Project for the term of the Project life. Alaska Energy Authority ‐ Renewable Energy FundBUDGET INFORMATION Federal Funds State FundsLocal Match Funds (Cash)Local Match Funds (In‐Kind)Other FundsTOTALS$0.00 $0 $320,682 $0.00 $0.00 $320,682$0.00 $0 $641,364 $0.00 $0.00 $641,364$0.00 $0 $1,282,727 $0.00 $0.00 $1,282,727$0.00 $1,534,564 $710,209 $0.00 $0.00 $2,244,773$0.00 $1,213,882 $710,209 $0.00 $0.00 $1,924,091$0.00 $858,905 $355,105 $0.00 $0.00 $1,214,010$0.00 $1,540,258 $887,761 $0.00 $0.00 $2,428,019$0.00 $2,576,715 $1,065,314 $0.00 $0.00 $3,642,029$0.00 $3,258,068 $1,597,970 $0.00 $0.00 $4,856,038$0.00 $3,939,421 $2,130,627 $0.00 $0.00 $6,070,048$0.00 $4,698,326 $2,410,732 $0.00 $0.00 $7,109,058$0.00 $7,122,488 $3,728,598 $0.00 $0.00 $10,851,085$0.00 $3,258,068 $1,597,970 $0.00 $0.00 $4,856,038$0.00 $2,399,163 $1,242,866 $0.00 $0.00 $3,642,029$0.00 $1,540,258 $887,761 $0.00 $0.00 $2,428,019$0.00 $858,905 $355,105 $0.00 $0.00 $1,214,010$0.00 $100,000 $50,000.00 $0.00 $0.00 $150,000$0.00 $75,000 $25,000.00 $0.00 $0.00 $100,000 $34,974,019 $20,000,000 $54,974,019Milestone # or Task #1234567891011121314$64,136 $128,273 $256,545 $448,955 $384,818 $242,802 $485,604 $728,406 $971,208 $1,214,010 $1,421,812 $2,170,217 $971,208 $728,406$6,414 $12,827 $25,655 $44,895 $38,482 $24,280 $48,560 $72,841 $97,121 $121,401 $142,181 $217,022 $97,121 $72,841$16,034 $32,068 $64,136 $112,239 $96,205 $60,700 $121,401 $182,101 $242,802 $303,502 $355,453 $542,554 $242,802 $182,101$9,620 $19,241 $38,482 $67,343 $57,723 $36,420 $72,841 $109,261 $145,681 $182,101 $213,272 $325,533 $145,681 $109,261$16,034 $32,068 $64,136 $112,239 $96,205 $60,700 $121,401 $182,101 $242,802 $303,502 $355,453 $542,554 $242,802 $182,101$198,823 $397,645 $795,291 $1,391,759 $1,192,936 $752,686 $1,505,372 $2,258,058 $3,010,744 $3,763,430 $4,407,616 $6,727,673 $3,010,744 $2,258,058$9,620 $19,241 $38,482 $67,343 $57,723 $36,420 $72,841 $109,261 $145,681 $182,101 $213,272 $325,533 $145,681 $109,261$320,682 $641,364 $1,282,727 $2,244,773 $1,924,091 $1,214,010 $2,428,019 $3,642,029 $4,856,038 $6,070,048 $7,109,058 $10,851,085 $4,856,038$3,642,029RFA AEA09-004 Budget Form Alaska Energy Authority ‐ Renewable Energy Fund15 16 17 18 TOTALS$485,604 $242,802 $30,000 $20,000 $10,994,804$48,560 $24,280 $3,000 $2,000 $1,099,480$121,401 $60,700 $0 $0 $2,736,201$72,841 $36,420 $4,500 $3,000 $1,649,221$121,401 $60,700 $4,500 $3,000 $2,743,701$1,505,372 $752,686 $108,000 $72,000 $34,108,892$72,841 $36,420 $0 $0 $1,641,721$2,428,019 $1,214,010 $150,000 $100,000 $54,974,019RFA AEA09-004 Budget Form $52/MWHDRAFTUMED District CHPAnchorage, AlaskaPreliminary AnalysisTurbine Pro Forma OutputNovember 4, 2008Project Cash Flow - Version Solar Mercury 50-6000RYEAR: -1012345678910111213142008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023REVENUESElectricity PPA Price$52.00$53.56 $55.17 $56.82 $58.53 $60.28 $62.09 $63.95 $68.61 $73.60 $78.95 $84.69 $90.85 $97.46Electricity Sold, MWH72,892 72,892 72,892 72,892 72,892 72,892 72,892 72,892 72,892 72,892 72,892 72,892 72,892 72,892 Electric Energy Payment3,790,386 3,904,098 4,021,221 4,141,858 4,266,114 4,394,097 4,525,921 4,661,699 5,000,809 5,364,588 5,754,830 6,173,459 6,622,541 7,104,291 CFI Price$1.75 $1.80 $1.86 $1.91 $1.97 $2.03 $2.09 $2.15 $2.22 $2.28 $2.35 $2.42 $2.50 $2.57CFI's Generated15,017 15,017 15,017 15,017 15,017 15,017 15,017 15,017 15,017 15,017 15,017 15,017 15,017 15,017 CFI Payment26,279 27,068 27,880 28,716 29,577 30,465 31,379 32,320 33,290 34,288 35,317 36,377 37,468 38,592 Thermal Price35.0000 36.0500 37.1315 38.2454 39.3928 40.5746 41.7918 43.0456 47.0969 51.5294 56.3792 61.6853 67.4909 73.8429 Thermal Energy Sold, MWH85,278 85,278 85,278 85,278 85,278 85,278 85,278 85,278 85,278 85,278 85,278 85,278 85,278 85,278 Thermal Energy Payment2,984,730 3,074,273 3,166,502 3,261,498 3,359,345 3,460,126 3,563,932 3,670,851 4,016,338 4,394,341 4,807,920 5,260,424 5,755,516 6,297,203 Backup Service Payment750,000 712,500 676,875 643,031 610,880 580,336 551,319 523,753 497,565 472,687 449,053 426,600 405,270 385,007 Float Earnings- - - - - - - - - - - - - - Interest Income- 10,000 10,000 10,361 10,715 11,074 11,438 11,813 12,060 12,302 12,539 12,936 13,251 13,743 14,410 TOTAL REVENUE- - 7,561,395 7,727,938 7,902,839 8,085,818 8,276,990 8,476,463 8,684,363 8,900,683 9,560,304 10,278,443 11,060,055 11,910,110 12,834,537 13,839,503 EXPENSESProjectSolar Mercury 50-6000RO&M80,000 82,400 84,872 87,418 90,041 92,742 95,524 98,390 101,342 104,382 107,513 110,739 114,061 117,483 Insurance32,000 32,000 32,000 34,967 34,967 34,967 38,210 38,210 38,210 41,753 41,753 41,753 45,624 45,624 Conventional Boiler Fuel- - - - - - - - - - - - - - Duct Burner Fuel35,461 35,461 35,461 35,461 35,461 35,461 35,462 35,462 35,462 35,462 35,462 35,462 35,462 35,462 GTG Fuel193,429 193,429 193,429 193,429 193,429 193,429 193,429 193,429 193,429 193,429 193,429 193,429 193,429 193,429 Fuel3,677,366 3,787,688 3,901,319 4,018,360 4,138,912 4,263,080 4,390,974 4,522,704 4,956,762 5,438,301 5,972,724 6,566,058 7,225,021 7,957,106 Service Agreement546,690 546,690 546,690 546,690 546,690 563,091 579,984 597,383 615,305 633,764 652,777 672,360 692,531 713,307 Reserve Fund25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 Leaseholder payments200,000 216,600 234,578 254,048 275,134 297,970 322,701 349,486 378,493 409,908 443,930 480,776 520,681 563,897 Power Use- - - - - - - - - - - - - - Reserve Fund- - - - - - - - - - - - - - Project PersonnelManagement100,000 103,000 106,090 109,273 112,551 115,927 119,405 122,987 126,677 130,477 134,392 138,423 142,576 146,853 Staffing1,000,000 1,030,000 1,060,900 1,092,727 1,125,509 1,159,274 1,194,052 1,229,874 1,266,770 1,304,773 1,343,916 1,384,234 1,425,761 1,468,534 (300,000) (300,000) (300,000) (300,000) (300,000) (200,000) (200,000) (200,000) (200,000) Accounting/Planning Oversight60,000 61,800 63,654 65,564 67,531 69,556 71,643 73,792 76,006 78,286 80,635 83,054 85,546 88,112 TOTAL OPERATING EXPENSES - - 5,649,946 5,814,068 5,983,993 6,162,937 6,345,224 6,650,498 6,866,384 7,086,716 7,613,455 8,395,535 9,031,531 9,731,288 10,505,691 11,354,807 Cash flow available for debt service1,911,449 1,913,870 1,918,845 1,922,881 1,931,766 1,825,964 1,817,979 1,813,967 1,946,849 1,882,909 2,028,524 2,178,823 2,328,846 2,484,696 RATE STABILIZATION FUNDAddition (subtraction) to Operating Reserves250,000 - 9,031 8,833 8,988 9,104 9,367 6,186 6,041 5,925 9,915 7,877 12,307 16,683 21,053 Operating Reserves250,000 250,000 259,031 267,864 276,852 285,956 295,324 301,509 307,551 313,476 323,391 331,269 343,576 360,259 381,311 DEBT SERVICECREB Bond- - - - - - - - - - - - - - Muni Bond1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 TOTAL DEBT PAYMENTS- 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 Coverage1.34 1.34 1.35 1.36 1.37 1.31 1.31 1.31 1.40 1.36 1.46 1.56 1.66 1.77 Remaining CREB Bond- - - - - - - - - - - - - - Remaining Municipal Bond24,383,387 23,992,143 23,581,336 23,149,990 22,697,076 22,221,517 21,722,179 21,197,875 20,647,355 20,069,310 19,462,362 18,825,067 18,155,907 17,453,289 Warranty Expense- - - - - - - - - - - - Capitalized Warranty Fund- 25,000 50,000 75,000 100,000 125,000 150,000 175,000 200,000 225,000 250,000 275,000 300,000 325,000 350,000 Remaining Warranty Fund- 25,000 50,000 75,000 100,000 125,000 150,000 175,000 200,000 225,000 250,000 275,000 300,000 325,000 350,000 Construction Interest Expense (Cap CREB)- - - - - - - - - - - - - - - Capitalized Interest- - - - - - - - - - - - - - - Remaining Capitalized Interest- - - - - - - - - - - - - - - Interest Expense (Cap Muni)- - - - - - - - - - - - - - Capitalized Interest- - - - - - - - - - - - - - Remaining Capitalized Interest- - - - - - - - - - - - - - - Net cash flow after debt service - - 301,035 294,425 299,599 303,480 312,248 206,184 201,381 197,512 330,511 262,580 410,234 556,102 701,750 853,231 SECURITIZED CASH FLOWNet cash flow to investor- - - - - - - - NPV of cash flows to investor at- NET CASH FLOWS AVAILABLE TO PROJECTNet cash flow201,381 197,512 330,511 262,580 410,234 556,102 701,750 853,231 Cumulative cash flow- - - - - - 201,381 398,892 729,403 991,984 1,402,217 1,958,319 2,660,069 3,513,300 NPV Cash Flow4,117,534$ NPV Rate Stabilization Fund$3,078,446.59Project Discount Rate8.30%1/211/5/2008 11:34 AM $52/MWHDRAFTUMED District CHPAnchorage, AlaskaTurbine Pro Forma OutputProject Cash Flow - Version Solar Mercury 50-6000RYEAR:REVENUESElectricity PPA PriceElectricity Sold, MWHElectric Energy PaymentCFI PriceCFI's GeneratedCFI PaymentThermal PriceThermal Energy Sold, MWHThermal Energy PaymentBackup Service PaymentFloat EarningsInterest IncomeTOTAL REVENUEEXPENSESProjectO&MInsuranceConventional Boiler FuelDuct Burner FuelGTG FuelFuelService AgreementReserve FundLeaseholder paymentsPower UseReserve FundProject PersonnelManagementStaffingAccounting/Planning OversightTOTAL OPERATING EXPENSESCash flow available for debt serviceRATE STABILIZATION FUNDAddition (subtraction) to Operating ReservesOperating ReservesDEBT SERVICECREB BondMuni BondTOTAL DEBT PAYMENTSCoverageRemaining CREB BondRemaining Municipal BondWarranty ExpenseCapitalized Warranty FundRemaining Warranty FundConstruction Interest Expense (Cap CREB)Capitalized InterestRemaining Capitalized InterestInterest Expense (Cap Muni)Capitalized InterestRemaining Capitalized InterestNet cash flow after debt serviceSECURITIZED CASH FLOWNet cash flow to investorNPV of cash flows to investor atNET CASH FLOWS AVAILABLE TO PROJECTNet cash flowCumulative cash flowNPV Cash FlowNPV Rate Stabilization FundProject Discount Rate151617181920Totals2024 2025 2026 2027 2028 2029$100.39 $103.40 $106.50 $109.70 $112.99 $116.3872,892 72,892 72,892 72,892 72,892 72,892 7,317,420 7,536,943 7,763,052 7,995,944 8,235,823 8,482,898 117,057,990$ $2.65 $2.73 $2.81 $2.89 $2.98 $3.0715,017 15,017 15,017 15,017 15,017 15,017 39,750 40,942 42,170 43,436 44,739 46,081 706,133$ 76.0582 78.3399 80.6901 83.1108 85.6041 88.1722 85,278 85,278 85,279 85,279 85,279 85,279 6,486,122 6,680,708 6,881,132 7,087,569 7,300,199 7,519,208 99,027,938$ 365,756 347,468 330,095 313,590 297,911 283,015 9,622,711$ - - - - - - -$ 15,252 16,276 17,323 18,151 19,013 19,900 272,558$ 14,224,301 14,622,339 15,033,773 15,458,690 15,897,685 16,351,102 226,687,330$ 121,007 124,637 128,377 132,228 136,195 140,280 2,149,630$ 45,624 49,855 49,855 49,855 54,478 54,478 836,183$ - - - - - - 35,462 35,462 35,462 35,462 35,462 35,462 193,429 193,429 193,429 193,429 193,429 193,429 8,195,821 8,441,697 8,694,950 8,955,800 9,224,476 9,501,212 123,830,330$ 734,706 756,747 779,450 802,833 826,918 851,726 13,206,331$ 25,000 25,000 25,000 25,000 25,000 25,000 500,000$ 610,701 661,389 716,284 775,736 840,122 909,852 9,462,283$ - - - - - - -$ - - - - - - -$ 151,259 155,797 160,471 165,285 170,243 175,351 2,687,037$ 1,512,590 1,557,967 1,604,706 1,652,848 1,702,433 1,753,506 26,870,374$ 90,755 93,478 96,282 99,171 102,146 105,210 1,612,222$ 11,716,354 12,295,458 12,684,265 13,087,645 13,510,901 13,945,505 184,432,202$ 2,507,947 2,326,880 2,349,508 2,371,045 2,386,783 2,405,597 42,255,129$ 25,597 26,158 20,709 21,552 22,172 22,626 270,125$ 406,908 433,066 453,775 475,327 497,499 520,125 7,084,069$ - - - - - - -$ 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 32,208,267$ 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 1,610,413 32,208,267$ 1.79 1.70 1.73 1.75 1.78 1.80 - - - - - - 16,715,540 15,940,903 15,127,535 14,273,499 13,376,760 12,435,185 - - - - - - 375,000 400,000 425,000 450,000 475,000 500,000 375,000 400,000 425,000 450,000 475,000 500,000 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 871,937 690,309 718,385 739,080 754,198 772,558 9,776,737$ - - - - - - 871,937 690,309 718,385 739,080 754,198 772,558 4,385,237 5,075,545 5,793,930 6,533,010 7,287,208 8,059,766 2/211/5/2008 11:34 AM © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 21 11/10/2008 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 © © © © © © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 30 11/10/2008 Please note that Kit Duke and Butch White agreed that the University of Alaska will submit the following unsigned draft letter with this application and the University’s Board of Regents will considers this Grant Application at their December 1-2, 2008 meeting. In the event that they approve the Application, the President can sign the letter and submit it for final inclusion. University of Alaska Resolution © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 31 11/10/2008 UNIVERSITY OF ALASKA ANCHORAGE PRELIMINARY ADMINISTRATIVE APPROVAL Name of Project: UAA, Providence Hospital & ML&P Combined Heat and Power Plant Location of Project: Anchorage Campus Project Number: 564290(09-02) Total Project Cost: $30,000,000 Approval Required: President INTRODUCTION Preliminary Administrative Approval (PAV) represents provisional approval of a project subject to further review and analysis of the programmatic need, budget, and other factors. It also represents authorization to plan the project through the facility needs analysis, programming, and scoping, including development of a Project Agreement or a Facilities Pre-Design Statement. PAV is a prerequisite for inclusion in the Six-Year Capital Plan unless otherwise approved by the Board. A PAV is required for all projects. The level of approval required shall be based upon Total Project Cost (TPC) as follows: • TPC > $2 million will require approval by the university President • TPC ≤ $2 million will require approval by the university’s Chief Finance Officer (CFO) or designee. Prior to requesting a PAV, the MAU may commit up to $50,000 in unrestricted funds for initial planning, conceptualization, scoping, and design, including contracted architectural, engineering and consulting services. The CFO may authorize the commitment of up to $250,000 in unrestricted funds or available capital funds for this purpose in special circumstances. Except as may be authorized by the CFO or designee for capital projects under $0.5 million, no employee, officer, or agent may commit the university to planning or other obligations in connection with a proposed capital project that are in excess of $250,000 or have an equivalent non-cost impact on the university without Formal Project Approval. BODY OF THE APPROVAL © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 32 11/10/2008 1. Background UAA has been investigating the feasibility of providing electricity to the campus and heating the campus buildings with the waste heat from natural gas fired turbine generator, with both Providence Hospital and ML&P as partners. If the project is successful, the university will have the ability to reduce its natural gas consumption by up to 50% and save approximately $1,000,000 in annual operating cost based on the 2008 cost of natural gas. Both UAA and Providence currently have an electrical requirement for 5 megawatts each, and have individually concluded that a combined heat and power plant will save money for each institution on both fuel and operating expense. In addition, UAA will soon be faced with major renewal of the existing boilers in almost all of the buildings on the West Campus as they approach 40 years in age. Installation of the central heat and power plant will allow the university to minimize this expensive replacement. The current plan for the facility is that UAA will own and furnish the site and will own the building in which the equipment is housed. ML&P will own the electrical generating equipment and will supply the gas for fuel. Providence and UAA will each own the heat exchangers required by their respective campus. Operation of the electrical generating facility will be ML&P’s responsibility and may be by a third party operator. UAA will not become a utility operator. This power plant will be connected to the electrical grid like all other ML&P generating stations and will cause no changes in the existing electrical service to the UAA campus. UAA and Providence will continue to be service customers of ML&P. 2. Preliminary Project Scope The project will be based on installing at least two 5 megawatt turbine generators with heat exchangers on the exhaust that will deliver both steam heat for the hospital’s heating needs and hot water for the university. The hospital will build a laundry facility on the site to make use of the steam heat as close to the source as possible. Since the new UAA Medical/Health Science campus will eventually require parking structures to accommodate parking on the limited site, the plan is to incorporate the power plant and possibly the laundry into the parking structure in order to minimize the impact of these utility functions on the academic campus. The hot water distribution to the UAA campus is planned to be in the pedestrian bridge connections between the Health Science Campus and the main part of campus in the Wells Fargo Sports Complex 3. Programmatic Need Addressed by the Project The power plant will be used for educational purposes for vocational training on gas turbine generators by ML&P. There should be follow up with Provost and Dean of CTC. As UAA grows the electrical and heating needs will continue to grow. Providence Hospital also has growth interests. 4. Estimated Total Project Cost Analyze the impact on students, faculty, and constituents to be served: The business plan with Project Cost is being developed by our Program Management Consultant along with Sources of Funds, Sources of Revenue/Income, Operating Costs and Cash Flow Model © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 33 11/10/2008 5. Proposed Cost and Funding Source(s) This should describe the cost and funding source(s) for the next phase of the project and for eventual completion of the project. Planning cost for Grant Application and joint UAA, Providence Hospital and ML&P Feasibility Study $300,000 (divided into three equal parts among the three participants) UAA portion ($100,000) is from the Utility and Infrastructure appropriation for the Health Science Building The power plant will cost approximately $25,000,000 and the UAA distribution piping will cost an additional $30,000,000. The university and our partners are applying for a State of Alaska Renewable Energy Grant for $35,000,000 and a business model is being developed that will help define the cost of the project, sources of funds, sources of revenue, long term operating and maintenance costs and a cash flow model. 6. Maintenance and Operating Costs (M&R) Outline the facilities maintenance and operating costs impact including a provision for renewal and replacement (R&R) costs: Annual operating cost for heating the campus may be reduced by approximately $1,000,000 when all existing buildings are connected to hot water distribution system. 7. Backfill Plan Outline the plan for re-allocation or disposition of vacated space including estimates of associated costs of consequential relocation, renovation, and related activities, if any: Not applicable 8. Incremental Costs Describe the incremental costs of program and service enhancements: • UAA Land will be used for the project. • A parking garage for the next phases of HS Campus buildings be sited in proximity to the power plant to keep this area industrial. • Pedestrian Crossing(s) yet to be funded over Providence could carry the distribution piping. 9. Other Cost Considerations The hot water distribution lines for UAA will be a separate project it is currently estimated at about $30M. UAA will borrow the construction funds and pay back through energy savings. 10. Schedule for Completion Grant Proposal Submission Nov. 2008 Project Economic Feasibility Study April 2009 Project Development Apr. – Oct. 2009 Project Design Oct. 2009 – Oct. 2010 © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 34 11/10/2008 Plant Construction Oct. 2010 – Oct. 2011 Distribution Construction Oct. 2010 – Oct. 2012 11. Supporting Documents Attached: MLP, Providence, UAA Agreement to study CHPP Talking Points for Combined Heat and Power © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 35 11/10/2008 Providence Health & Services, a not-for-profit Catholic health care ministry, has been meeting the health care needs of Alaskans since the first Sisters of Providence arrived in Nome in 1902. Today, over 4,000 employees serve Alaskans in facilities in six communities. Through the LifeMed air ambulance service, a partnership with Yukon-Kuskokwim Health Corporation, Providence serves Alaskans from around the state, bringing them to the state’s largest hospital, 364-bed Providence Alaska Medical Center (PAMC), when they need a higher level of medical care. Providence is the only health care organization in Alaska providing a full continuum of care – from the state’s only Level III Newborn Intensive Care Unit to palliative care and hospice services for those at the end of life. Continuing a legacy of service today, Providence provided over $51 million in donated health care and other services in 2007. Examples of these dollars in action include direct contributions that enable local non-profits to care for those in need. Providence has provided the evening meal at the Brother Francis Shelter for many years. Providence community benefit dollars also fund health care services that otherwise would not exist in Alaska, such as the pediatric subspecialty clinic, which brings up sub specialists from out of state so that Alaska kids can stay home for care. The community benefit total of $51 million included over $16 million in charity care, almost $30 million in uncovered costs of government sponsored health care, over $700,000 in subsidized health services, over $700,000 in health professions education, $1.9 million in community health improvement and $1.2 million in cash and in-kind donations. As Alaska’s largest hospital, PAMC serves as an important link in city-wide emergency response efforts, participating in emergency response coordination and drills. In the event of a serious emergency, it is imperative that the physical plant at PAMC remain operational. This project improves the likelihood of mechanical and electrical survivability in the event of a disaster, allowing the hospital to continue its mission of caring for those in need. When the 1964 earthquake hit, Anchorage residents camped outside of Providence (then in its old location on L Street) because they felt safe there. Today, Providence plays an even larger role in the health and well-being of Alaska. Providence committed to service – and deeply connected to the communities it serves. © HGA 2008 Renewable Energy Fund Grant Application AEA 09-004 Grant Application 36 11/10/2008 11. Approval Bill Spindle, Vice Chancellor Date Joseph Trubacz, Chief Finance Office Date Mark Hamilton, President Date Approval Notes This approval is based on the following assumptions: This Preliminary Administrative Approval allows for co-development of the ML&P, UAA, Providence CHPP project to determine economic feasibility and serves as University authority to apply for a Renewable Energy Grant thru the State of Alaska in the fall of 2008. IDTask NameDurationStartFinish1Phase I – Reconnaissance Requirements 66 daysWed 10/1/08Wed 12/31/082Phase I66 daysWed 10/1/08Wed 12/31/083Proposed Energy Resource 22 daysWed 10/1/08Thu 10/30/084General description of the extent and amount of the renewab22 daysWed 10/1/08Thu 10/30/085Existing Energy System 22 daysWed 10/1/08Thu 10/30/086Basic configuration (number, size, age, and type of gensets 22 daysWed 10/1/08Thu 10/30/087Capital and replacement costs 22 daysWed 10/1/08Thu 10/30/088Annual O&M cost and schedule22 daysWed 10/1/08Thu 10/30/089Annual fuel consumption and fuel price22 daysWed 10/1/08Thu 10/30/0810Load information (peak, minimum, average, and future trend22 daysWed 10/1/08Thu 10/30/0811Plans for system upgrades 22 daysWed 10/1/08Thu 10/30/0812Residential and commercial electrical service rates 22 daysWed 10/1/08Thu 10/30/0813Avoided cost of energy 22 daysWed 10/1/08Thu 10/30/0814Proposed System Design 22 daysWed 10/1/08Thu 10/30/0815Description of renewable energy technology specific to proje22 daysWed 10/1/08Thu 10/30/0816Alternative system discussion 22 daysWed 10/1/08Thu 10/30/0817Optimum installed capacity 22 daysWed 10/1/08Thu 10/30/0818Annual generation 22 daysWed 10/1/08Thu 10/30/0819Anticipated barriers 22 daysWed 10/1/08Thu 10/30/0820Basic integration concept 22 daysWed 10/1/08Thu 10/30/0821Proposed System Costs 22 daysWed 10/1/08Thu 10/30/0822Total anticipated project cost for this phase 22 daysWed 10/1/08Thu 10/30/0823Projected capital, O&M, and fuel costs 22 daysWed 10/1/08Thu 10/30/0824Projected debt financing if applicable22 daysWed 10/1/08Thu 10/30/0825Project Benefits 22 daysWed 10/1/08Thu 10/30/0826Annual fuel displacement and savings over the project life 22 daysWed 10/1/08Thu 10/30/0827Annual revenue from energy sales, tax credits, green tags, a22 daysWed 10/1/08Thu 10/30/0828Discussion of non-monetary benefits 22 daysWed 10/1/08Thu 10/30/0829Energy Purchase/Sale 22 daysWed 10/1/08Thu 10/30/0830Identification of potential energy market 22 daysWed 10/1/08Thu 10/30/0831Potential energy purchase and sales rates 22 daysWed 10/1/08Thu 10/30/0832Land Ownership 5 daysWed 10/1/08Tue 10/7/0833Landowner(s) identified and contacted 5 daysWed 10/1/08Tue 10/7/0834Permits 26 daysWed 10/1/08Wed 11/5/0835List of applicable permits 26 daysWed 10/1/08Wed 11/5/0836Anticipated permitting timeline 26 daysWed 10/1/08Wed 11/5/0837Potential regulatory barriers 26 daysWed 10/1/08Wed 11/5/0838Environmental 60 daysWed 10/1/08Tue 12/23/0839Complete environmental screening60 daysWed 10/1/08Tue 12/23/0840Threatened and Endangered species and other habitat 60 daysWed 10/1/08Tue 12/23/0841Fisheries and wildlife protection60 daysWed 10/1/08Tue 12/23/0842Water and air quality impacts 60 daysWed 10/1/08Tue 12/23/0843Wetland and protected areas 60 daysWed 10/1/08Tue 12/23/0844Archaeological and historical resource impacts 60 daysWed 10/1/08Tue 12/23/0845Land development constraints 60 daysWed 10/1/08Tue 12/23/0846Telecommunications and aviation impacts 60 daysWed 10/1/08Tue 12/23/0847Visual and aesthetics resource impacts 60 daysWed 10/1/08Tue 12/23/0848Other environmental barriers 60 daysWed 10/1/08Tue 12/23/0849Analysis and Recommendations 27 daysWed 10/1/08Fri 11/7/0850Basic economic analysis of alternatives 26 daysWed 10/1/08Wed 11/5/0851Recommendations for additional project development work26 daysWed 10/1/08Wed 11/5/0852Submit AEA Grant Application0 daysFri 11/7/08Fri 11/7/0853Phase II – Feasibility Analysis and Conceptual Design Requireme131 daysThu 1/1/09Thu 7/2/0954Phase II129 daysThu 1/1/09Tue 6/30/0911/7SepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebMarApr200920102011Anchorage Municipal Light & Power and University of Alaska Anchorage - Energy Conservation ProjectPage 1 IDTask NameDurationStartFinish55Proposed Energy Resource 20 daysThu 1/1/09Wed 1/28/0956Site-specific assessment of available energy resource follow20 daysThu 1/1/09Wed 1/28/0957Existing Energy System 70 daysThu 1/1/09Wed 4/8/0958Annual load profile—power projects may require onsite mea30 daysThu 1/1/09Wed 2/11/0959Load growth projections 20 daysThu 1/1/09Wed 1/28/0960Transmission system layout and capacity 61 daysThu 1/1/09Thu 3/26/0961Retirement schedule 20 daysThu 3/12/09Wed 4/8/0962Proposed System Design 127 daysThu 1/1/09Fri 6/26/0963Identification and analysis of system alternatives 10 daysThu 1/1/09Wed 1/14/0964Recommended alternative including discussion of impacts o5 daysThu 1/15/09Wed 1/21/0965Assessment of project site, including geotechnical character10 daysThu 1/1/09Wed 1/14/0966Annual energy production profile 10 daysThu 1/1/09Wed 1/14/0967Conceptual system design 62 daysThu 1/1/09Fri 3/27/0968Conceptual integration design52 daysThu 1/15/09Fri 3/27/0969Issue Program/ Conceptual Design0 daysFri 3/27/09Fri 3/27/0970Schematic system design 65 daysMon 3/30/09Fri 6/26/0971Schematic integration design65 daysMon 3/30/09Fri 6/26/0972Issue Schematic Design0 daysFri 6/26/09Fri 6/26/0973Identification of remaining technical barriers 15 daysThu 1/29/09Wed 2/18/0974Project Costs 80 daysFri 3/13/09Thu 7/2/0975Conceptual level cost estimates15 daysFri 3/13/09Thu 4/2/0976Schematic level cost estimates 15 daysFri 6/12/09Thu 7/2/0977Annual O&M and fuel costs 5 daysFri 6/12/09Thu 6/18/0978Other project costs including leases, taxes, insurance, and fi5 daysFri 6/12/09Thu 6/18/0979Project Benefits 15 daysFri 5/29/09Thu 6/18/0980Annual fuel displacement and savings over the project life 5 daysFri 6/12/09Thu 6/18/0981Detailed analysis of revenue from energy sales, tax credits, g15 daysFri 5/29/09Thu 6/18/0982Discussion of non-monetary benefits 2 daysFri 6/5/09Mon 6/8/0983Energy Purchase/Sale 10 daysFri 6/19/09Thu 7/2/0984Preliminary energy purchase or sales agreement 10 daysFri 6/19/09Thu 7/2/0985Land Ownership 30 daysThu 1/1/09Wed 2/11/0986Assessment of site control requirements for proposed projec20 daysThu 1/1/09Wed 1/28/0987Authorization from land owners for onsite feasibility activities10 daysThu 1/29/09Wed 2/11/0988Permits 100 daysThu 1/1/09Wed 5/20/0989Obtain authorizations from all applicable agencies for any us100 daysThu 1/1/09Wed 5/20/0990Environmental 40 daysWed 1/21/09Tue 3/17/0991Site-specific assessment of resources that may be significan20 daysWed 1/21/09Tue 2/17/0992Plan for addressing potential environmental impacts 20 daysWed 2/18/09Tue 3/17/0993Analysis and Recommendations 82 daysThu 1/1/09Fri 4/24/0994Comprehensive economic and financial analyses of alternati1 dayThu 1/1/09Thu 1/1/0995Recommendations for project design and construction activit10 daysThu 1/1/09Wed 1/14/0996Draft operational and business plan 20 daysMon 3/30/09Fri 4/24/0997Phase III – Final Design and Permitting Requirements 162 daysWed 7/1/09Thu 2/11/1098Phase III132 daysWed 7/1/09Thu 12/31/0999Renewable Energy Resource 10 daysWed 7/1/09Tue 7/14/09100Updated data to confirm that resource is still available 10 daysWed 7/1/09Tue 7/14/09101Existing Energy System 120 daysWed 7/1/09Tue 12/15/09102Final engineered and approved energy system configuration120 daysWed 7/1/09Tue 12/15/09103Proposed System Design 132 daysWed 7/1/09Thu 12/31/09104Design Development62 daysWed 7/1/09Thu 9/24/09105Issue Design Development0 daysFri 9/25/09Fri 9/25/09106Final engineered and approved system design70 daysFri 9/25/09Thu 12/31/09107Final engineered and approved integration design 70 daysFri 9/25/09Thu 12/31/09108Interconnection study 10 daysFri 9/25/09Thu 10/8/093/276/269/25SepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebMarApr200920102011Anchorage Municipal Light & Power and University of Alaska Anchorage - Energy Conservation ProjectPage 2 IDTask NameDurationStartFinish109Issue Construction Documents0 daysThu 12/31/09Thu 12/31/09110Project Costs 90 daysFri 9/11/09Thu 1/14/10111Design Development stimate of project cost 20 daysFri 9/11/09Thu 10/8/09112Final engineer’s estimate of project cost 20 daysFri 12/18/09Thu 1/14/10113Project Benefits 30 daysFri 10/9/09Thu 11/19/09114Detailed financial analysis based on chosen business structu30 daysFri 10/9/09Thu 11/19/09115Power Purchase/Sale25 daysFri 11/20/09Thu 12/24/09116Final operational and business plan 25 daysFri 11/20/09Thu 12/24/09117Land Ownership 30 daysWed 7/1/09Tue 8/11/09118Final land use authorizations obtained 30 daysWed 7/1/09Tue 8/11/09119Permits 100 daysFri 9/25/09Thu 2/11/10120All necessary permits obtained 100 daysFri 9/25/09Thu 2/11/10121Environmental 50 daysFri 10/23/09Thu 12/31/09122All environmental issues resolved 50 daysFri 10/23/09Thu 12/31/09123Analysis and Recommendations 25 daysFri 11/20/09Thu 12/24/09124Final operational and business plan 25 daysFri 11/20/09Thu 12/24/09125Phase IV – Construction Requirements 324 days?Fri 1/1/10Thu 3/31/11126Phase IV261 daysFri 1/1/10Fri 12/31/10127Renewable Energy Resource 1 day?Fri 1/1/10Fri 1/1/10128Monitoring to verify and update projections and system effici1 day?Fri 1/1/10Fri 1/1/10129Existing Power System 1 day?Fri 1/1/10Fri 1/1/10130Coordination of conversion, integration, or surplus of existing1 day?Fri 1/1/10Fri 1/1/10131Proposed System Design 210 daysFri 1/1/10Thu 10/21/10132Construction plan and schedule10 daysFri 1/1/10Thu 1/14/10133Commissioning plan and schedule20 daysFri 1/15/10Thu 2/11/10134Modifications to final design during construction 200 daysFri 1/15/10Thu 10/21/10135Project Costs 300 daysFri 1/15/10Thu 3/10/11136Reports as required by permitting agencies 300 daysFri 1/15/10Thu 3/10/11137Environmental 300 daysFri 1/15/10Thu 3/10/11138Reports as required by permitting agencies 300 daysFri 1/15/10Thu 3/10/11139Permiting 1 dayFri 1/1/10Fri 1/1/10140Reports as required by permitting agencies 1 dayFri 1/1/10Fri 1/1/10141Analysis and Recommendations 65 daysFri 10/22/10Thu 1/20/11142Update business plans and power purchase agreements as 25 daysFri 10/22/10Thu 11/25/10143Final project report including as-built specifications and draw20 daysFri 11/26/10Thu 12/23/10144Periodic operation and maintenance reports as required by g20 daysFri 12/24/10Thu 1/20/11145Construction324 daysFri 1/1/10Thu 3/31/11146Contracts / Permits / Mobilization21 daysFri 1/1/10Fri 1/29/10147Construction240 daysMon 2/1/10Fri 12/31/10148Contractor Mobilized0 daysFri 1/29/10Fri 1/29/10149CHP Earthwork Complete - Utility Piping 10%0 daysFri 2/26/10Fri 2/26/10150CHP Footings Complete - Utility Piping 25%0 daysFri 3/26/10Fri 3/26/10151CHP Foundation Complete - Utility Piping 40%0 daysFri 4/30/10Fri 4/30/10152CHP Structure 75% - Utility Piping 55%0 daysFri 5/28/10Fri 5/28/10153CHP Enclosed- Utility Piping 70%0 daysFri 6/25/10Fri 6/25/10154CHP MEP Equipment On Site- Utility Piping 85%0 daysFri 7/30/10Fri 7/30/10155CHP MEP Hookups 75%- Utility Piping Complete0 daysFri 8/27/10Fri 8/27/10156CHP Interior Finishes 50%0 daysFri 9/24/10Fri 9/24/10157CHP Site Work Complete0 daysFri 10/29/10Fri 10/29/10158CHP Punchlist0 daysFri 11/26/10Fri 11/26/10159CHP Certificate of Occupancy0 daysFri 12/31/10Fri 12/31/10160Commissioning Report0 daysThu 3/31/11Thu 3/31/11161Phase V – Commissioning64 daysMon 1/3/11Thu 3/31/11162Analysis and Recommendations 64 daysMon 1/3/11Thu 3/31/1112/311/292/263/264/305/286/257/308/279/2410/2911/2612/313/31SepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebMarApr200920102011Anchorage Municipal Light & Power and University of Alaska Anchorage - 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