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HomeMy WebLinkAboutWind Power Opportunities Around the Lake & Peninsula Borough App Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 1 of 14 9/2/2008 Application Forms and Instructions The following forms and instructions are provided for preparing your application for a Renewable Energy Fund Grant. An electronic version of the Request for Applications (RFA) and the forms are available online at http://www.akenergyauthority.org/RE_Fund.html The following application forms are required to be submitted for a grant recommendation: Grant Application Form GrantApp.doc Application form in MS Word that includes an outline of information required to submit a complete application. Applicants should use the form to assure all information is provided and attach additional information as required. Application Cost Worksheet Costworksheet.doc Summary of Cost information that should be addressed by applicants in preparing their application. Grant Budget Form GrantBudget.xls A detailed grant budget that includes a breakdown of costs by task and a summary of funds available and requested to complete the work for which funds are being requested. Grant Budget Form Instructions GrantBudgetInstr.pdf Instructions for completing the above grant budget form.  If you are applying for grants for more than one project, provide separate application forms for each project.  Multiple phases for the same project may be submitted as one application.  If you are applying for grant funding for more than one phase of a project, provide a plan and grant budget for completion of each phase.  If some work has already been completed on your project and you are requesting funding for an advanced phase, submit information sufficient to demonstrate that the preceding phases are satisfied and funding for an advanced phase is warranted.  If you have additional information or reports you would like the Authority to consider in reviewing your application, either provide an electronic version of the document with your submission or reference a web link where it can be downloaded or reviewed. REMINDER:  Alaska Energy Authority is subject to the Public Records Act, AS 40.25 and materials submitted to the Authority may be subject to disclosure requirements under the act if no statutory exemptions apply.  All applications received will be posted on the Authority web site after final recommendations are made to the legislature. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 2 of 14 9/3/2008 SECTION 1 – APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) Lake and Peninsula Borough Type of Entity: Borough Government Mailing Address PO Box 495, King Salmon, AK 99613 Physical Address Same Telephone 907.246.3421 Fax 907.246.6602 Email ljcotten@gci.net 1.1 APPLICANT POINT OF CONTACT Name Lamar Cotten Title Borough Manager Mailing Address PO Box 495, King Salmon, AK 99613 Telephone 907. 301.8737 Fax 907.272.5076 Email ljcotten@gci.net 1.2 APPLICANT MINIMUM REQUIREMENTS Please check as appropriate. If you do not to meet the minimum applicant requirements, your application will be rejected. 1.2.1 As an Applicant, we are: (put an X in the appropriate box) An electric utility holding a certificate of public convenience and necessity under AS 42.05, or An independent power producer, or X A local government, or A governmental entity (which includes tribal councils and housing authorities); Yes or No 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 or No 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 or No 1.2.4. If awarded the grant, we can comply with all terms and conditions of the attached grant form. (Any exceptions should be clearly noted and submitted with the application.) Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 3 of 14 9/3/2008 SECTION 2 – PROJECT SUMMARY Provide a brief 1-2 page overview of your project. 2.1 PROJECT TYPE Describe the type of project you are proposing, (Reconnaissance; Resource Assessment/ Feasibility Analysis/Conceptual Design; Final Design and Permitting; and/or Construction) as well as the kind of renewable energy you intend to use. Refer to Section 1.5 of RFA. This project is a regional Resource Assessment/Feasibility Analysis/Conceptual design of Wind Power opportunities around the Lake & Peninsula Borough. We have bundled several communities into one package so as to reduce administrative overhead for the Borough, Contractors and Granting Agencies. 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. This project is a regional Resource Assessment/Feasibility Analysis/Conceptual design of Wind Power opportunities around the Lake & Peninsula Borough. It is designed to build upon existing wind resource assessment efforts, including wind met tower data in some communities, as well as data from existing micro-scale (10kW) wind turbines that are in operation. The communities included in this package are: Pedro Bay Port Alsworth Egegik Iliamna-Newhalen-Nondalton Port Heiden Pilot Point In addition to the Borough Management and staff working closely with the local utilities, the Borough intends to hire HDR as their lead engineering consulting firm for these assessments. The intended outcome of this work is a set of bid documents for a regional Engineering, Procurement and Construction (EPC) contract. 2.3 PROJECT BUDGET OVERVIEW Briefly discuss the amount of funds needed, the anticipated sources of funds, and the nature and source of other contributions to the project. Include a project cost summary that includes an estimated total cost through construction. The Borough is requesting $184,000 in grant funds for this regional wind resource assessment, or less than $40,000 per community for met towers, data collection and analysis, local electric and heating load assessment, a study of individual community wind/diesel system integration, Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 4 of 14 9/3/2008 site selection (land issues, right-of-way, preliminary geotech), permitting, environmental assessment, final cost estimate and bid documents in preparation for letting a regional EPC contract for bid. At this point in the process, if all of the communities continue to exhibit cost effective wind power potential, we anticipate the construction phase will cost on the order of $8 million. See attached spreadsheets for the Screening Study estimates. 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. Based on the screening study, we anticipate total annual fuel savings from all six communities on the order of $930,000 on a capital investment of $8 million for a simple payback of 8.6 years. The project benefits associated with the reduction in diesel fuel purchases by local electric utilities will be especially helpful to local businesses and commercial enterprises, such as fishing and tourism, that have been especially hard hit by the high cost of energy since they are without PCE support. 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.) $8,000,000 2.5.2 Grant Funds Requested in this application. $184,000 2.5.3 Other Funds to be provided (Project match) $40,000 2.5.4 Total Grant Costs (sum of 2.5.2 and 2.5.3) $224,000 2.5.5 Estimated Benefit (Savings) $930,000 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.) $930,000 in avoided fuel purchases that will be reflected in lower electric rates to residents, commercial and government customers and the PCE program. See Project Cost Worksheet Attachment B Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 5 of 14 9/3/2008 SECTION 3 – PROJECT MANAGEMENT PLAN Describe who will be responsible for managing the project and provide a plan for successfully completing the project within the scope, schedule and budget proposed in the application. 3.1 Project Manager Tell us who will be managing the project for the Grantee and include a resume and references for the manager(s). If the applicant does not have a project manager indicate how you intend to solicit project management Support. If the applicant expects project management assistance from AEA or another government entity, state that in this section. Lamar Cotten, the Lake & Peninsula Borough will be the project manager for the Borough and he will hire HDR, a large well-known engineering firm to act as the engineer of record and owner’s representative on these and other renewable projects in the Borough . 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.) Please see Project Schedule Attachment D 3.3 Project Milestones Define key tasks and decision points in your project and a schedule for achieving them. Please see Project Schedule Attachment D 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. Please see Resumes Attachment A 3.5 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. The Borough Manager will manage communication on the project, including benchmark memos to updates to the Authority. Any consultants or vendors brought into the project will provide the Borough Manager with weekly updates via email. 3.6 Project Risk Discuss potential problems and how you would address them. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 6 of 14 9/3/2008 Fuel price risk. We will continue to monitor the long run outlook of the price of fuel oil. To the extent that it appears likely that it will continue its most recent decline, we will revisit the need for the project as we seek funding for the construction portion of the project and again before bid award. Capital project cost risk. We will be diligent in our preparation of design and bid documents to mitigate against undue uncertainty in the bid price and an HDR representative will monitor the construction project to ensure all communications are clear and concise to reduce uncertainty and unnecessary costs. 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. Based on the Screening Study, the wind resources adjacent to the communities where we intend to develop a cost effective wind-diesel hybrid system are: Pedro Bay – Class 7 wind Newhalen – Class 6 wind Pilot Point – Class 5 wind Port Alsworth – Class 5 wind Egegik – Class 5 wind Port Heiden – Class 4 wind Please see attachments E through H for detailed information 4.2 Existing Energy System 4.2.1 Basic configuration of Existing Energy System Briefly discuss the basic configuration of the existing energy system. Include information about the number, size, age, efficiency, and type of generation. The existing diesel systems range in size from 60kW John Deere gen sets up to roughly 500kW Cat gen sets. This study will examine each local central power station to ensure a reliable cost effective integration of Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 7 of 14 9/3/2008 wind resources with the existing diesel power plant. Additional information about individual communities and their gen sets can be found in the Denali Commission diesel gen set condition inventory. 4.2.2 Existing Energy Resources Used Briefly discuss your understanding of the existing energy resources. Include a brief discussion of any impact the project may have on existing energy infrastructure and resources. The communities in this grant application primarily rely upon diesel gen sets to produce electricity. Their basic annual electrical production and fuel usage is described in the attached Application Cost Worksheet. For additional detail, please see the attached spreadsheets from the Screening Study Attachments E through H 4.2.3 Existing Energy Market Discuss existing energy use and its market. Discuss impacts your project may have on energy customers. The basic rates for electricity in these communities range from $0.45/kWh up to $0.80/kWh – the highest rates reflecting remote rural locations which receive fuel deliveries by plane. In high penetration wind systems, which are possible in several of the communities where it appears that Class 5, 6 and & 7 wind resources may be available, a 80% grant funded project could reduce rates by as much as 50% Base Rate = 80c/kWh Cost of Power Adjustment = 60c/kWh Replace half of diesel kWhs with wind at 80% grant funding; cost of power adjustment = $20c/kWh New Rate = 20c/kWh non fuel + 20c/kWh COPA = 40c/kWh, a 50% savings over the status quo. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 8 of 14 9/3/2008 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 goal of this phase of the project is to develop a cost effective wind-diesel hybrid system that meets the needs of the local community. 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 Borough will take the lead in working with local land owners to obtain permission to perform recon activities and if the resource assessment yields attractive results, the Borough will obtain right of way and land leases as appropriate. 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 The Borough will retain HDR to obtain all necessary permits. 4.3.4 Environmental Address whether the following environmental and land use issues apply, and if so how they will be addressed:  Threatened or Endangered species  Habitat issues  Wetlands and other protected areas  Archaeological and historical resources  Land development constraints  Telecommunications interference  Aviation considerations  Visual, aesthetics impacts  Identify and discuss other potential barriers Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 9 of 14 9/3/2008 The Borough will retain HDR to identify environmental and land issues that may apply and develop and execute a plan to obtain all necessary permits. 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 Please see attached Screening Study Attachments E through H The basic sources for the data on wind and wind-diesel hybrid system cost and performance include: NREL Wind Maps AEA Wind Web Page Met data from 10KW micro wind installations Quotes from vendors in the February 2008 renewable grant submissions, updated to reflect current quotes in the market 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 Anticipated O&M costs are expected to be supplied by local maintenance workers in consultation with a regional wind training program. The annual O&M costs are included in the screening study estimates. 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 4.4.4 Cost Worksheet Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 10 of 14 9/3/2008 Complete the cost worksheet form which provides summary information that will be considered in evaluating the project. See Cost Worksheet Attachment B The basic sources for the data on wind and wind-diesel hybrid system cost and performance include: NREL Wind Maps AEA Wind Web Page Met data from 10KW micro wind installations Quotes from vendors in the February 2008 renewable grant submissions, updated to reflect current quotes in the market Additional information was obtained by reviewing PCE reports from the past three years. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 11 of 14 9/3/2008 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 Borough management will be working toward the development of a regional assistance model, ala a wind/diesel hybrid “circuit rider” to assist local staff with ensuring adequate and timely maintenance of local infrastructure. 4.4.6 Analysis and Recommendations Provide information about the economic analysis and the proposed project. Discuss your recommendation for additional project development work. Based on the Screening Study of the Lake & Peninsula Borough Screening Study, the Borough is pursuing funding for the resource assessment/feasibility/conceptual design for wind diesel hybrid systems in communities where it appears cost effective. See attached Screening Study Spreadsheets for the recon level economic analysis Attachments E through H 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 Please see attached Screening Study spreadsheets for the recon level economic analysis attachments E through H For all of the communities in this package, we estimate annual fuel savings on the order of $930,000. 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 Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 12 of 14 9/3/2008 Consistent with this phase of the project, the Borough anticipates providing on the order of 20% match, typically reflecting a combination of in-kind support, including Borough employee and contractor assistance with local data gathering, including land and right of way issues. The Borough also expects the local utility to work together with the borough to seek grant and loan funding for those projects which appear to be the most cost effective. Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 13 of 14 9/3/2008 SECTION 7 – ADDITIONAL DOCUMENTATION AND CERTIFICATION SUBMIT THE FOLLOWING DOCUMENTS WITH YOUR APPLICATION: A. Resumes of Applicant’s Project Manager, key staff, partners, consultants, and suppliers per application form Section 3.1 and 3.4 B. Cost Worksheet per application form Section 4.4.4 C. Grant Budget Form per application form Section 6. D. An electronic version of the entire application per RFA Section 1.6 E. Governing Body Resolution per RFA Section 1.4 Enclose a copy of the resolution or other formal action taken by the applicant’s governing body or management that: - authorizes this application for project funding at the match amounts indicated in the application - authorizes the individual named as point of contact to represent the applicant for purposes of this application - states the applicant is in compliance with all federal state, and local, laws including existing credit and federal tax obligations. F. CERTIFICATION The undersigned certifies that this application for a renewable energy grant is truthful and correct, and that the applicant is in compliance with, and will continue to comply with, all federal and state laws including existing credit and federal tax obligations. Print Name Lamar Cotten Signature Title Borough Manager Date 10.08.08 Renewable Energy Fund Grant Application AEA 09-004 Grant Application Page 14 of 14 9/3/2008 List of attachments: A – Resumes B – Cost Worksheet C – Budget Form D – Project Schedule E through H – Wind Screening Spreadsheets I – Borough Resolution J – Diesel Price Projections