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REPORTS,
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[ALASKA POWER AUTHORITY
EXTERNAL REVIEW PANEL
SUSITNA HYDROELECTRIC PROJECT
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AP R I L,1982
JUN 2;;1992
January 24,1981
SUSITNA HYDROELECTRIC PROJECT
EXTERNAL REVIEW PANEL
REPORT NO.1
INTRODUCTION
The Panel met with representatives of the Alaska Power Authority Board
and its staff and representatives of Acres American in Anchorage on
January 22-24,1981 for discussions on studies for the Susitna Hydro-
electric Project.On January 22nd,Power Authority staff members gave
the Panel a general background of the project and studies which are
underway,and Acres representatives described the current status of
these studies.A site inspection of the project was made on January
23rd.Discussions of the Panel IS findings were held in the morning of
January 24th,and this report which summarizes the Panel IS opinions and
recommendations was prepared that afternoon.
GEOTECHNICAL INVESTIGATIONS
We recognize that the field exploratory program for the 1981 season may
be modified somewhat depending upon relative priorities assigned to the
Devil Canyon vs Watana damsites as well as FERC requirements.With this
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in mind,we would like to offer the following suggestions for your con-
sideration.
Devil Canyon Site
The general geotechnical conditions at this site are reasonably well
known as a result of the availabiltiy of rock outcrops and the borings
done to date.The field geologic mapping scheduled for the coming
season will provide further basic information and should be carried out
as planned.At this time local geologic structures will be mapped and
can be projected to those borings already completed.The geometry of
these geologic features can then be used to orient the proposed under-
ground structure to a degree adequate for this stage of the project.
We believe that the proposed borings could be reduced or eliminated
entirely based upon the above comments and especially because Devil
Canyon may be deferred well into the future.It appears that the field
program at Watana requires a greater degree of study and the borings
planned for Devil Canyon might better be drilled at the upstream site.
Watana Site
The field exploration program at the damsite consists primarily of
geologic mapping,borings,and locating sources of borrow material.We
agree with the general approach of Acres;however,we would like to see
more emphasis placed upon defining the properties of the materials in
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the old river channel on the right abutment and upon the rock conditions
at the proposed underground chamber location.
The buried channel leaves the existing river valley just upstream of the
damsite and crosses the right abutment exiting downstream in Tsusena
Creek.The base of the channel is believed to be about 400 feet below
reservoir level and is likely filled with pervious alluvial deposits and
perhaps some glacial till.
Once the proposed seismic profiling has been completed we suggest that
at least two borings (rather than the one currently planned)be drilled
into this feature.Sampling of the alluvial materials should be done to
a degree sufficient to obtain an estimate of permeability and a flow
net analysis made.This will serve to check the initial Corps of Engineers
estimate that seepage through the channel is of no importance to the
project.At a future stage in the project development a deep well
pumping test may be advisable.
The proposed underground chambers are located in the left abutment and
lie between recognized zones of poor quality rock.At present little is
known of the rock conditions in the actual chamber site.We therefore
recommend that two deep angle holes be drilled early in the summer
program to cross the chamber site.If rock conditions are generally
good,then the design can proceed to feasibility level.If not,and if
serious concern exists about the technical feasibiltiy of the chambers,
then exploratory adits will be required.In our experience adits provide
much more precise information on actual rock conditions than a larger
number of borings.
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In summary,it appears that more borings will be required at Watana than
currently planned.If those included for Devil Canyon are relocated to
Watana,our preliminary estimate might be a net increase of about $250,000
in drilling costs.
SEISMIC STUDIES
Since Alaska is one of the most seismically active areas in the United
States,the investigation for the Susitna Project has appropriately
devoted much attention to the seismicity of the region in which it would
be constructed,the location of active faults which could affect the de-
sign of the dams and the determination of the intensity of ground shaking
to which the project facilities might be subjected.
The study is on-going but to date no faults with known recent displace-
ment (i .e.displacement in the last 100,000 years)have been found to
pass through the proposed sites for the dams.However,four features in
the vicinity of the Watana site and nine features in the vicinity of the
Devil Canyon site have been judged to require additional investigations
to better define their potential effect on dam design considerations.
In the vicinity of the Watana dam site these features are:
""'"(1)The Talkeetna thrust fault,
(2)The Susitna feature,,-
(3)The Fins feature,and
""""(4)a feature designated KD3-7 which follows the channel of
the Susitna River in this area.-
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Of these features,the Talkeetna thrust and the KD-7 feature are likely
to have greatest significance for the design of a dam at the Watana
site -the Talkeetna thrust because it could well determine the level of
design earthquake ~haking if it were found to be active and the KD3-7
feature because its passes directly through the proposed dam and could
lead to a significant off-set potential if its activity were established.
In general,however,both the Watana dam and the Devil Canyon dam appear,
on the basis of present evidence,to be located within a tectonic unit
designated the Talkeetna Terrain which seems to be a coherent unit,free
of kno\'tn active fault displacements \'Jithin the crust and subject only to
major strain releases (major earthquakes)along the fault systems
bounding the Terrain.Within the Terrain minor strain releases,causing
small earthquakes,appear to be occurring randomly within the crust.If
these conditions are confirmed by subsequent investigations,they could
be considered a highly favorable feature of the project location.
Under these conditions,the strongest earthquake shaking which could
affect either of the proposed dams would be caused by a major earthquake
generated on the Benioff zone which underlies the Terrain at depths
varyi ng from 25 mil es in the southeastern part of the regi on to over 60
miles at the northwestern part of the region.The maximum accelerations
at the proposed dam sites for such an event are of the order of 0.4g.
Present assessments of the seismic geology and the potential intensity
of ground shaking could be changed considerably,however,if some of the
more prominent features,currently considered to be inactive,but con-
cerning which considerable uncertainty on this question exists,\'/ere
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found to have undergone recent displacements.For the Watana dam,the
most important of these features appear to be the Talkeetna thrust and
KD3-7 and it is therefore suggested that primary attention be directed
to determining the potential activity of these features as early as
possible in the 1981 study program.
It is also important to establish that no active faults pass through or
in very close proximity to the Devil Canyon site since the presence of
such faults could have a major effect,not only on the design criteria,
but also on the type of dam which could be constructed at this site.
At the present time,reservoir-induced seismicity does not appear to be
a significant problem in view of the coherence of the Talkeetna Terrain.
This would change however,if active faults were found to exist in the
vicinity of the dam sites and the clarification of the potential activity
of the 13 features about which uncertainty exists is important for this
reason.
Once the seismic geology of the Talkeetna Terrain is established,the
seismic design criteria for the dams can be established and suitable
design sections selected and validated.In the meantime,for prelim-
inary planning purposes,it \'JOuld seem appropriate to use a design
cross-section for the Watana Dam similar to that used for the Oroville
Dam in California which has already been subjected to a detailed in-
vestigation of seismic stabil ity and found to be adequately strong to
withstand the strongest levels of earthquake shaking which can currently
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be anticipated for the dams of the Susitna project.
HYDRAULICS AND HYDROLOGY
The field program for surveys and collection of hydrologic data,generally,
appears to be adequate.After analysis of available existing and collected
data,it may be found necessary to collect some additional field data,
particularly with respect to downstream river channel conditions.
Special attention should be given to reservoir capacities,reservoir
timber,reservoir slides,nitrogen supersaturation and downstream river
channel conditions.
Reservoir Capacity
The reservoir capacity curves which have been used in the studies to
date are based on survey maps with 50 and 100 foot contour intervals.
Recent surveys have been completed from which more accurate capacity
curves will be developed.If those curves show actual reservoir capa-
cities to be substantially less,(say 10 per cent or more),than capa-
cities which were used,then the effect of the smaller capacities on
project costs and benefits should be determined.In the case of Watana
Dam,the dam would need to be raised somewhat to retain the same power
benefits.If the dam is not raised,greater reservoir drawdown would be
required to maintain a high level of power production.Sufficient check
studies should also be made to determine whether the smaller reservoir
capacities would affect the best system development.
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Reservoir Timber
Consideration should be given to the possible blockage of spillways and
reservoir outlets by large masses of floating timber which in all pro-
bability would occur if a large amount of the reservoir is not cleared.
Masses of floating timber will have detrimental environmental effects as
discussed later in this report.A determination will need to be made on
what extent the reservoir should be cleared.
Reservoir Slides
Although a potential for slides in the reservoirs which would cause
excessive height waves at the dams is not evident,this should be veri-
fied by field investigations.
Nitrogen Supersaturation
There should be no major problems with the hydraulic design of the
spillways and outlet works,except possibly for detrimental effects due
to nitrogen supersaturation.The deep stilling basins and high-velocity
flow with entrained air may cause excessive nitrogen to be introduced
into the flow which would be harmful to downstream fish.A flip bucket
which produces a deep plunge pool may also produce a nitrogen super-
saturation problem.A flip bucket which would deflect flows horizon-
tally into the downstream channel would minimize this problem but may
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cause excessive channel erosion downstream of the dam.It is suggested
that studies by the Corps of Engineers to minimize the nitrogen super-
saturation problem on the Columbia River be reviewed for guidance on
whether there will be such a problem on the Susitna River and,if so,
how best to resolve it.
Downstream River Channel
The determination of future project effects on the downstream Susitna
River channel configuration is an extremely difficult task.Estimates
can be made of the possible changes in channel regime due to flow changes
by sediment transport and flow analyses,but localized conditions often
significantly affect channel changes.This may be particularly true in
cold climates.It would be well if analytical or other contemplated
studies were supported by studies of actual channel conditions before
and after project construction elsewhere in Alaska or Canada.
SYSTEM DEVELOPMENT
The Panel is impressed with the many combinations of project units being
considered for determining the best system development.We believe that
all viable combinations are being considered.The depth of studies for
the alternatives,subject to modifications and additions suggested in
this report,should be sufficient for selecting the optimum development .
ENVIRONMENTAL QUESTIONS
Environmental questions concern fisheries,wildlife and recreation.
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Additional comments on environmental matters will follow receipt of
reports of on-going studies.
Fisheries
The two impoundments will change many miles of running grayling stream
into impounded still water that will probably support many grayling and
other species such as lake trout.The sport fishing in Devil Canyon
reservoir might be substantially enhanced.Water levels in the Watana
reservoir will fluctuate too much to support a desirable recreational
fishery.Fortunately,few salmon reach the upper Susitna River for
spawning.Possible effects of the impoundments will be down river,
where breeding salmon spawn in many tributaries.The altered flow re-
gime,following impoundment,may change the topograpy of the channel as
well as the chemistry of the water.Dissolved nitrogen would be particu-
larly harmful.Settling out of particulate matter might alter the
surnmer behavi or of salmon fry.Wi nter fl ows mi ght be mil ky whereas now
they are clear.Data derived from other similar impoundments should be
examined to anticipate and minimize problems.We urge that re1event
records from allover the world (Canada,Scandanavia,Russia,Argentina,
etc.)be assemble and scrutinized.
Wild1 ife
The impoundment areas will obviously be lost to occupation by moose,
caribou,bears and many small animals.~,1oose normally .are forced off
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the higher slopes by deep snow and resort to the river banks,but this
retreat will not be possible if the river banks are flooded.There will
be some definite loss in moose numbers around the impoundments.Down-
stream,the stabilization of flows may dampen the process of cut-and-
fill which is the primary process of renewal of willow browse for winter
moose food.Additional reduction of moose numbers is possible there.
Caribou will be little affected by the impoundments if the water areas
are kept clear of debris.However,unless the timber is stripped from
the impoundments there might be an unsightly tangle of logs floating to
the surface which would endanger the lives of swimming caribou and de-
spoil the impoundments for boating,fishing,and general recreation.
Bears,other furbearers and carnivores,and many birds and small mammals
would lose the impoundment areas as habitat,but the effect would be
minimal in terms of regional populations of the more abundant species.
No rare or endangered species have been identified in the project area.
Waterfowl might be adversely affected in the Susitna delta area by
reduction of flood flows in summer,which normally fill many potholes
and oxbows.
All the above problems should be addressed.
Recreational
Access roads to the dam sites will permit public entry to country that
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currently is de facto wilderness.This will give many people access to
the reservoirs for fishing and to the surrounding countryside for hunting
and general recreation.It will sacrifice the wilderness value,and
doubtless will lead to reduction in numbers of big game animals by
increasing hunting pressure.Planning for regulated recreational
development is suggested.
Some Further Studies Recommended
(1)Design spillways to minimize nitrogen intake.
(2)Assemble data on downstream effects on salmon and on moose
habitat at other impoundments in similar terrain.
(3)Study water regimes in Susitna delta to see if reduced
summer flows in the impounded watershed will materially
affect waterfowl habitat .
(4)Plan to strip impoundment areas of trees and compute added
cost to project.
(5)Plan recreational development of impoundment areas to opti-
mize public values and minimize adverse over-development.
ECONOMIC FEASIBILITY AND FINANCING
The following are some of our very preliminary thoughts and concerns
in the areas of:
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Demand and markets for electricity
Economic evaluation of the Susitna Project
Financial viability
Demands and Markets
Both the ISER and subsequently modified Acres'results show a degree of
uncertainty in the range of projected demands for electricity by consumers
in the Rai1be1t Region.These range from a low of 6,200 GWH by the year
2010 to a high of 13,500 GWH with a 1980 consumption of about 2,400 GWH .
Clearly,this demand forecast has a large impact on the need for the
Susitna project,where one dam site alone would generate about 3,100 GWH
per year.
Some of the fundamental questions are:
Under the low demand forecast is there an economic need for the
Susitna project at all?
If there is a need,can the project be substantially delayed
without an economic or environmental loss?
To refine the range of forecasts,the approach to forecasting could be
improved in several ways.
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Specifically include the potential impact of upward trends in
the cost of electricity in the demand estimates for electricity.
Anchorage currently has some of the least costly electricity
in the nation~and as prices increase,this will clearly have
a moderating impact on demand.In the Fairbanks area~the ISER
report indicates that since 1975 there has been a per customer
decline in electricity use.Is this decline influenced by higher
electricity rates in Fairbanks?
Perform a more detailed investigation on the uses of electricity
in the commercial sector and the projected demand for electricity
by these office buildings,retail establishments,government
institutions and the like.A definition of use patterns and a
comparative analysis of trends in Alaska versus other states and
provinces in Canada would be helpful.This analysis is suggested
as a major share of the projected growth in electricity demand and
corresponding need for the Susitna Project in related to growth
in electricity use in the cornmercial sector.This growth is calcu-
lated to be a result of both employment gains and increased used
per employee.In the lower 48,with the advent of higher elec-
tricity prices there has been an acceleration in conservation
through technology.IBM,Honeywell ,Johnson Control ~etc.,are
advertising and installing control computers in buildings which
reduce power requirements by upwards of 20%.Is a forecast that
assumes a definite increase on a per employee use basis appropriate?
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Test the sensitivity of the forecast to a reasonable set of
assumptions in the growth in selected energy intensive indus-
tries such as:
-mining (Beluga coal,for example)
-petrochemicals
Because of the high level of variability in any forecast,this
panel recommends the "uncertainty"be specifically included in
all economic evaluations.
Economic Evaluations
The purpose of the economic analysis should initially be to test the
sensitivity of the conclusions to a reasonable range of assumptions con-
cerning the key variables.Since the economic tradeoffs are between a
capital project (Susitna)and lower capital but higher operating costs
of coal and gas units,the range of cost of capital needs to be fully
explored.In particular,since the probable economic alternatives to
the Susitna project are coal or gas generation,the reasoning and analysis
behind the estimates of the capital costs,fuel escalation rates and
hours of operation for each alternative need to be defined for review
and tests of reasonableness.Furthermore,since we are dealing with an
uncertain market,the size of anyone power plant addition will impact
the economic choice and mix of power plants.
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The proposed project will be paid for by the ultimate customer in actual
dollars;assumptions on inflation need to be included in economic analyses.
However,from a comparison viewpoint,these inflated dollars can be
discounted to a constant 1981 basis.The plea here is for consistency
between the economic and financial calculations.The availability of
tax-exempt bonds for one alternative vis~a-vis the other will also
influence the competitive economics.
There are also some primary concerns as they relate to costs and esca-
lation rates of the coal and gas alternatives,together with assumptions
on federal policy as to the use of gas in power generation.Again,a
range of cases needs to be examined in this area.
We understand that Acres is employing a computer model to assist in this
economic evaluation,and we are available to assist Acres in defining a
set of cases to be run by the model to explore the range of possibil-
ities.As any model has a set calculation procedure that may be in
error,it is advisable to test the model against other approaches.In
this respect EPRI (Electric Power Research Institute)has developed
other models that are currently being used by U.S.utilities.
Financial Viability
The financing of the Susitna project will be of a scale and magnitude
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that will challenge and possibly surpass the ability of anyone under-
writer.Revenue bonds,guarantees by the state and other financing
mechanisms need to be fully explored.Every attempt should be made to
obtain funding through a tax-exempt vehicle,which will effectively
lower the ultimate electric rates to customers in the Railbelt Region.
In addition,the ability to obtain tax-exempt financing could signi-
ficantly increase the economic competitiveness of the Susitna project.
We understand Acres is working in this area,and we cannot comment
further on their work until we have an opportunity to review their
findings.However,we would like to emphasize the importance of the
financing to the success of the project.
FUTURE ~lEETINGS
Further meetings of the External Review Panel are planned as follows:
March 20 and 21,1981
June 3 to 6,1981
October 6 to 8,1981
San Francisco,California
Anchorage,Alaska
Anchorage,Alaska
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The panel expresses its appreciation to the members and staff of the
Alaska Power Authority and the staff of Acres American Incorporated for
the many courtesies extended to the Panel during the course of the 3 day
meeting .
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Merlin D.Copen
A.Starker Leopold
Dennis M.Rohan
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Jacob H.Douma
H.Bolton Seed
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March 20,1981
Mr.Charles Conway
Chairman of the Board
Alaska Power Authority
333 West 4th Avenue,Suite 31
Anchorage,Alaska 99501
De ar t·1 r.Con way :
The External Review Panel met with representatives of the
Alaska Power Authority Board of Directors and its staff and
representatives of Acres American in San Francisco on March 20,
1981 to discuss the feasibility studies for the Susitna Hydro-
lectric Project.Prior to the meeting,Panel members studied
Acres reports on Review of Available hydrology Material,Review
of Previous Design Development Studies and Reports and Project
Overview.A first draft of the report from the Alaska Power
Authority to the Governor and Legislature was reviewed before the
meeting and a second draft was received during the meeting.APA
staff members briefed the Panel on the draft report and the
Acres representative presented an update of feasibility study
events since the January,1981 meeting.
This letter expresses the Panel's opinion whether,based on
information available on four critical issues,the feasibility
studies should continue to completion in April,1982,or be ter-
minated now.The Panel concurs that the four critical issues
concern the power demand forecast,seismic risk,environmental
impacts and economic feasibility.Our present opinions concer-
ning these issues are summarized below.
The load forecasts have an inherent assumption of continued
growth in the commercial market for electricity,and implied
expansion in the service sector of the Rail Belt economy.If
the economy develops in this manner,and real electric rates do
not increase substantially and there is no major change in con-
servation,then the range of forecasts suggested by ISER seems
reasonable.
The Susitna Project is probably competitive on a direct
economic basis with power generated from coal.Insufficient
information is available at this time to evaluate the attactive-
ness of the Susitna Project vis-a-vis other alternatives such as
gas or tidal power.
Charles Conway,
Chairman of the Board
~1arch 20,1981
Page 2
Based on the field investigations completed to date,both
the Watana and Devil Canyon sites appear to be well suited for
the hydroelectric developments proposed.The initial studies
have defined the general site and rock conditions at the sites
and the general seismic geology of the area in which the pro-
posed dams are to be constructed.The seismic design require-
ments appear to be well within the state-of-the-art for construc-
tion of facilities of this type.Important geologic features
have also been recognized which merit further attention and
investigation programs have been proposed which are well conceived
and should provide a sound basis for feasibility design and cost
estimates as well as insuring an ample level of seismic safety.
Some excellent studies are under way concerning ecologic
conditions in the Susitna basin and possible environmental
effecti of hydro development.Above the dams there will be inun-
dation of habitats occupied seasonally by moose,caribou,bears,
and various lesser species,and there will be modification
of the stream flow below the dams which could affect the habitats
of salmon,moose and waterfowl.On-going studies should be con-
tinued,with amplification of hydrological studies in the Susitna
River to better understand possible downstream effects on flora>
fauna and the riverbed itself.Based on present knowledge however,
there are no obvious environmental threats so serious as to sug-
gest abandonment of continued planning for the hydro project.
Thus in non-economic terms,Alaska is fortunate to have the
hydroelectric power potential in areas where the technical,social
and environmental impacts appear to be of a manageable nature.
The potential for developing renewable,non-polluting hydro-
electric power has definite advantages which,though the economic
implications require detailed study,are not always amenable to
direct economic evaluation.
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Charles Conway,
Chairman af the Board
t1arch 20,1981
Page 3
In summary,it appears that definite answers cannot yet be
given to all of the issues involved in evaluating the geo-
technical,environmental,economic and market aspects of develo-
ping the Susitna Project.However,we believe that the work
accomplished to date shows sufficient promise for the future
welfare and interests of Alaska and that it is clearly desir-
able to continue the present studies,supplemented by appropri-
ate additional investigations,to their 1982 completion date.
Sincerely yours,
Jacob H.Douma
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Dennis M.Rohan
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Absent gut responded
Andrew H.Merritt
.~\.·0~tt~L
H.Bolton -Seer
June 5,1981
SUSITNA HYDROELECTRIC PROJECT
EXTERNAL REVIEW PANEL
REPORT NO.2
INTRODUCTION
The Panel met with representatives of the Alaska Power Authority,Acres
American,Terrestrial Environmental Specialists,Inc.,and the Fish and
Game Department in Anchorage on June 3-5,1981 for discussions of on-going
studies for the Susitna Hydroelectric Project.On June 3rd,representatives
of Acres American,TES and ADF&G described the current status of these
studies,after which separate group discussions were held on geotechnical,
hydraulics and hydrology,and environmental subjects to review specific
problem areas in more detail.A site inspection was made by Dr.Merritt on
June 4th and 5th to review the field geotechnical exploration program.Dr.
Rohan met with representatives of Battelle on June 2nd,Chugach Electric
Association on June 4th and Union Oil on June 5th to discuss alternatives
to the Susitna project.This report,which summarizes the Panel's opinions
and recommendations,was prepared on June 4th and 5th and discussed with
representatives of the Power Authority staff and Acres.Dr.Seed was not
able to attend the meeting.
GEOTECHNICAL INVESTIGATIONS
Following Dr.Merritt's l~day visit to the Watana and Devil Canyon sites,
discussions were held at High Lake concerning the on-going field program
and preparation of information appropriate for the feasibility design.The
following comments summarize these discussions and are offered to aid in
the timely completion of the field program.
General -The preparation of finalized geologic maps and profiles is not
keeping pace with the rapid accumulation of field information.This
situation is compounded by the recent acquisition of a large quantity of
field geologic data collected by previous Corp of Engineers work which was
never reduced and presented in final form by the Corps.Moreover,the
original Corps boring logs need to be reviewed (re-logged)to assure that
all field information is presented in a consistent manner.
A schedule for completion of the various phases of work for the summer
program has been prepared to assure that the necessary information is
analyzed in time for the next phase of feasibility design.The External
Review Panel will be prepared to review this work during our October
meeting.
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Wa tana Site
Field geologic mapping is underway,the results of which will be used to
best locate the remaining exploratory borings.Present structure layouts
indicate that the "Finsll shear zone should not intersect any tunnels or
open cuts.Special attention is being given to the projection of the
"FingerbusterJl shear zone concerning its possible intersection of the
downstream portion of the tailrace tunnels.Present information suggests
that thi s zone 1.i es downstream of the proposed underground powerhouse;
however,exploratory borings are planned to confirm this interpretation.
Additional seismic surveys will be done to better define the geometry of
the buried channel on the right abutment and additional borings and pumping
tests are planned for the next phase of exploration.
Devil Canyon Site
The geologic mapping is well advanced at this site and no new shear zones
have been identified on the abutments.Boring BH-7 has confirmed the
presence of a shear zone (previously recognized)beneath the topographic
lineation on the left abutment.This feature wll be receiving careful
attention during the upcoming Task 4 study.
Numerous open stress relief joints have been recognized in the upper por-
tion of both abutments and are apparently more prevalent on the left side.
The field geologists will be mapping these features in detail to assist in
preliminary layouts of the required excavation for the arch dam.
Four borings remain to be drilled at Devil Canyon;2 will pass beneath the
river to explore for geologic structures and 2 more drilled into the abut-
ments near the river to determine general rock quality.If the river hole
in progress encounters favorable conditions,then the second hole may not
be required for the feasibility design.Considering the excellent rock
exposures,the two remaining borings may best be drilled at the upper
elevations (on the left side)rather than close to the valley bottom as
presently planned.These holes should be directed to cross the stress
relief joints to determine their presence at depth.The drill advance can
be carefully watched to determine the presence of open joints.A borehole
camera would provide the most direct method of assessing the presence and
magnitude of these features and is being considered by Acres'personnel.
SEISt~IC STUDI ES
Seismic studies have evaluated all known and detectable faults and line-
aments in the project area.The 1981 field program calls for a study of
thirteen features identified as signifcant in the 1980 investigations.
In order to firm up design for the major structures in the project,it is
essential that conclusions regarding the significance and impact of each of
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these features be reached as soon as practicable.Delay in completing this
work and evaluating the parameters required for design will have an impor-
tant effect on meeting the project schedule.
HYDRAULICS AND HYDROLOGY
The field program for surveys and collection of hydrologic data is con-
sidered to be adequate for the current feasibility study.Modifications to
the original scope of work involve studies of navigation effects.However,
after analyses of available existing data and data to be collected,it may
be found necessary to collect some additional short-term information to
firm up tentative conclusions in one or more areas.Specific comments on
some areas of data collection are presented below.
Flood Flows
Stream flow data are being obtained at a sufficient number of existing,
reactivated and newly installed gaging stations throughout the drainage
area to enable a reliable determination of flood flows.Studies to date
indicate that the Corps PMF is about 20,000 cfs too low.A report on flood
discharges will be issued for review in a few weeks.Some 80 water level
cross-sections have been taken in the Susitna River.HEC programs are
being developed for free surface and ice covered water levels for various
size floods.Reports will be issued on free surface water levels in July
and ice covered conditions somewhat later.These studies should establish
reliable bases for determining river tailwater levels at the dams and water
surface profiles in downstream reaches of the Susitna River.
Sediment Data Collection
The river sediment measuring program has not been started.This program
should be defined and started as soon as possible under the guidance of the
USGS or a private river sediment expert.It is essential that bed load
measurements be made during this runoff season to enable a reasonable
assessment of the effects that depletion of sediment loads by construction
of the dams would have on downstream river conditions.The Panel is con-
cerned that the necessary sediment data may not be available in time for
inclusion into the June 30,1982 feasibility report.
Reservoir Capacity
Recent reservoir surveys have been completed from which more accurate capa-
city curves have been developed.At Watana,the revised curve indicates
one to two percent less reservoir capacity between elevations 1700 and
2100,but the capacity is essentially the same as shown by the original
curve at maximum pool elevation 2200.This small difference does not re-
quire revisions in the design development studies.However,the revised
capacity curve should be used in final design.
At Devil Canyon,the revised reservoir capacity curve based on the latest
3
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-
-
-
-
survey indicates significantly greater capacity than the initial capacity
curve,being approximately 30 percent greater at elevation 1500.Since
power operation would be near maximum pool nearly 100 percent of the time,
the revised greater capacity would have little influence on design develop-
ment studies.However,the greater capacity curve should be used in final
design and reservoir filling and drawdown studies.
Energy Output
The firm energy output for the Watana/Devil Canyon system has been deter-
mined by routing actual stream flows which occurred for the 1969-79 period
through the system.Since this was by far the period of lowest stream flow
over 70 years of record,the Panel concurs that this is a satisfactory
basis for establishing firm energy output.
DESIGN DEVELOPMENT
Acres described various alternative schemes for optimizing design of the
main dams,coffer dams,saddle dams,spillways,power facilities and
diversion tunnels for the two dams.The Panel was very impressed with the
many specific alternatives which will be studied to arrive at the most
functionally satisfactory and economical plan.We desire to emphasize,
however,that full consideration should be given to the effects on ease of
construction and construction schedules,as well as costs,for the various
alternatives.Specific comments follow on some of the design features that
will be considered in the optimization studies.
Multiple Level Outlets
There is some question whether multiple level outlets will be required in
the power intakes,particularly at Watana Dam.Some experience in several
Alaska lakes indicates that a marked thermal stratification may not occur
in the two reservoirs and that the reservoir waters may never be free of
turbidity,in which case multiple level outlets would not effectively
enhance downstream water temperatures or quality.The Panel is of the
opinion that sufficient studies should be made of other lakes to make a
better assessment of what is most likely to occur in Watana and Devil
Canyon reservoir.If the studies are inconclusive,then the Panel suggests
that multiple level outlets be provided at both dams,since their costs
would not be excessive and prototype experience may prove them to effec-
tively enhance water temperatures and quality downstream of the dams.An
exception to this statement,however,is that in the event Devil Canyon
will be constructed earlier than anticipated due to greater power demand,
then multiple level outlets may not be required at Watana Dam.
Low Level Outlet
Acres has given preliminary consideration to providing low level outlets at
both dams for lowering the reservoirs in the event of an emergency.Based
4
--------
on general guidance information used by the Corps of Engineers,a low level
outlet capacity of approximately 100,000 cfs would be required.This would
require construction of an additional large gated tunnel at great cost.A
low level outlet was provided at Mica Creek Dam in British Columbia by
providing a tunnel plug and gates in the diversion tunnel which would allow
substantial lowering of the reservoir in a period of 8 months.The Panel
believes that this type of low level outlet should be installed in the
diversion tunnels at Watana and Devil Canyon.This low level outlet would
provide for regulation of initial reservoir filling,minimum flow release
when the powerhouse is not in operation and emergency lowering of the'
reservoir over a substantial period of time for repairs in the event that
seepage problems should develop.
Service Spillway
One alternative scheme for Watana provides for a service spillway with a
stilling basin designed for a 1 in 10,000 year flood and a fuse plUg
spillway to handle additional flows up to the PMF.While there may be some
reduction in cost by reducing the size of the service spillway and increasing
the size of the fuse plug spillway,the Panel is of the opinion that the
service spillway should not be made smaller than required for a 1 in 10,000
year flood.However,some reduction in cost can be made by designing the
stilling basin to function as a hydraulic jump basin for a smaller discharge,
say 50 percent of the 1 in 10,000 year flow,and sweep out of the basin for
larger discharges,if this would not endanger the stilling basin structure.
Spillway Outlets in Arch Dam
Although technically feasible,the Panel suggests that consideration be
given to eliminating the spillway outlets through the arch dam at Devil
Canyon and the concrete lined plunge pool near the toe of the dam by in-
creasing the size of the service spillway.If there is not a substantial
increase in cost,the Panel would prefer to eliminate the outlets through
the arch dam.
Watana Dam
An embankment structure has been selected for feasibility studies at the
Watana site.It appears that very little effort has been expended to study
other types of dams for this site.A preliminary design has been prepared
for an arch dam,but,to our knowledge,essentially no attempt has been
made to compare the cost of these two structures,to evaluate construction
time or difficulties,or to otherwise evaluate potential alternatives.
As a basis for proceeding with feasibility studies,we consider it important
that economic comparisons be prepared for viable alternative dam types for
the Watana site.
Devil Canyon Dam
An arch dam appears to be the most appropriate structure for the Devil
Canyon site.This conclusion has been reached by essentially all inves-
tigators,and,we assume,is based on comparisons with other dam types for
5
'~~~~'----------'f""F'-'-rI-"-----------~--------
.-
.....
-
I~
-
the site.
Acres has developed a satisfactory arch dam design for the Devil Canyon
site.Stress levels appear to be acceptable for all .normal loading con-
ditions studies.A dynamic response spectrum analysis,assuming 0.5 gravity
ground acceleration and a 5 percent damping rate,was conducted.The re-
sulting stresses indicate that construction joints in the upper part of the
dam would open intermittently.Some horizontal surface cracking may also
occur on both faces.
We believe this loading to be extremely conservative.A damping rate of 10
percent is more appropriate for this situation,and a ground acceleration
no greater than 0.4 gravity appears to be more realistic.
ENVIRONMENTAL CONSIDERATIONS
Substantial progress is being made in the study of various environmental
considerations,such as the current status of fish and wildlife populations,
cultural resources (archaeologic remains),vegetation types,and alternative
location of access roads.Some crucial environmental issues,however,have
not been adequately addressed.These will require extra attention in the
1981 field season.In this category are downstream effects of the dams on
the river channel itself with potential secondary effects on fisheries and
wildlife,effects of the dams on water turbidity,and possible effects of
leaving standing timber in the impoundment areas .
Fisheries
Studies of fish population in the Susitna River Basin were late in starting
in 1980,but considerable data were accrued through the fall and winter
(1980-81).An accelerated program is underway in June 1981,which by 1982
should yield a preliminary picture of the existing situation.
The Susitna River above Devil Canyon apparently supports a substantial
population of grayling,but few if any salmon are able to ascend the stream.
Presumably,the grayling and probably lake trout will thrive in the impound-
ments.The question of whether they will constitute an important recrea-
tional fishery depends on the ultimate clarity or turbidity of the im-
pounded waters.Even if the water is turbid,there will be some sport
fishing at the mouths of clear streams entering the impoundments.
The lower Susitna River and its many tributaries and back waters carry
substantial populations of salmon that support an important commercial
fishery in Cook Inlet,as well as a sport fishery in the river channels and
at the river mouth.There are additional populations of grayling and
rainbow trout in many of the tributaries.On-going studies are intended to
shed light on the relative importance of the various tributaries,backwaters
and main channels in supporting fish life.Of particular significance in
this regard is gaining an understanding of the possible effects of the
impoundments on downstream hydrology.This can best be prognosticated by
6
--m--------------------~·__ri----__
-
measuring the bed load of sediment now carried by the Susitna and its
various tributaries.When the silt load from the upper Susitna is cut off
by the dams,what will be the changes in the conformation of the lower
river and the chemistry and turbidity of the water?Data on bed load must
be obtained before this important issue can be predicted.
Wil dl ife
The Alaska Department of Fish and Game is making commendable progress in
studying populations of moose,caribou,black and grizzly bears,wolves and
dall sheep.The moose will be directly affected by loss of winter range in
the Watana impoundment.In time,there may bea compensatory development
of new willow stands bordering the impoundment.Black bears will be all
but eliminated from the Watana impounded area by flooding of denning areas
and loss of protective timber.Caribou may be somewhat affected by disrup-
tion of seasonal migration to calving grounds.Dall sheep,grizzly bears,
and wolves will probably be only peripherally affected by disturbance of
their wilderness habitat.
The University of Alaska and the Alaska Cooperative Wildlife Research Unit
are studying populations of furbearers,non-game mammals,and birds.As
far as we know these studies are progressing satisfactorily.
Downstream Hydrology
Change in the amount of bed load carried by the Susitna River may affect
fisheries and wildlife in a number of ways.There is some indication that
the backwa tersand bi 11 abongs of the lower Sus itna may be important rea ri ng
areas for juvenile salmon.Summer flooding of these backwaters,sloughs,
and ponds creates extensive waterfowl habitat.Peak floods cut into
timber stands and deposit open bars which are colonized by willows that
constitute winter forge for moose.Understanding the dynamics of the lower
river is essential in predicting long-term effects of the Susitna project
on wildlife.
The need for additional hydrologic studies -especially bed load studies -
was discussed in the March meeting of the External Review Panel in San
Francisco.But as of June 1981,no firm plan of action has been imple-
mented.The Panel urges immediate action to assure that some useful data
on bed load will be available for consideration in October,1981.Without
it,there will be no way that downstream effects can be evaluated.
Water Chemistry and Turbidity
The water quality program is being prepared for Acres American by R &M
Consultants.No results have been made available to the Panel,nor even a
list of specific questions being investigated.From the standpoint of
fisheries it is important to know what may be the future turbidity of the
reservoirs and the Susitna River below.
7
,~
In summer,a substantial flow of turbid water will enter Watana Reservoir
from the glacier above.Heavy materials will be deposited in the reservoir
head,and smaller particles will be carried on toward the dam.To what
extent will the water clear as it approaches Watana dam?Will the water in
Devil Canyon reservoir be clear or cloudy?And what of water passing Devil
Canyon dam into the mainstream of the river below through summer and
winter alike?Clouded water blocks the passage of light and reduces or
precludes the growth of phytoplankton which form the base of the aquatic
food chain.The productivity of these waters for fish will be an inverse
function of turbidity.Are adequate studies underway to prognosticate
post-project water conditions?
Timber in Impoundment Area
At the January,1981 meeting of the Panel,the suggestion was made that
consideration be given to stripping the timber from areas to be impounded,
for the purpose of reducing the load of floating trash in the reservoirs.
Has this idea been considered?Has the cost been estimated?
Nitrogen Supersaturation
To protect fish life in the Devil Canyon reservoir and in the river below,
the design of both dams -including penstocks and overflow structures -
must minimize or preclude the incorporation of nitrogen into solution if
current studies by Mr.Milo Bell suggest this possibility.
Access Roads
Selection of the route or routes for constructing access roads should
avoid,insofar as possible,disturbance.of caribou or Dall sheep.These
two species are expecially susceptible to environmental disturbance.The
area south of the two reservoirs is of particular importance to sheep.The
calving ground of caribou adjoins the upper reaches of Watana impoundment
on the north.
ECONOMIC FEASIBILITY AND FINANCING
Battelle Pacific Northwest is responsible,under separate contract,to
review and analyze alternatives to the Susitna project.Dr.Rohan met on
June 2,1981 at BattelleJs office with Mr.Swift,the project manager and
several of his staff to review Battelle's progress and to gain a better
understanding of their approach.Battelle has addressed its initial effort
at understanding the gas supply situation,and in improving the demand
forecasting methodology.Copies of working draft reports on these subjects
are being forwarded for review by the External Review Panel.Because the
results of the Battelle study will be employed in Acre's final report due
in April 1982,it is recommended that the Alaska Power Authority monitor
the timeliness and \lJOrk quality of Battelle.
8
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....
-
From the initial Battelle meeting it was learned that Battelle's approach
to comparing alternatives is not totally consistant with the work of Acres.
In this respect,it clearly is advisable that Battelle and Acres meet in
the near future to arrive at a common basis to make economic comparisons of
the various alternatives.
Because of the high level of uncertainty in estimating a)the future
markets for electricity,b)the capital costs and construction time to
build power plants,c)the availability and prices for fossil fuels and,
d)future regulatory environments,it is recommended that all economic
analysis incorporate this uncertainty.Techniques for making economic
comparisons under uncertainty are well known and include sensitivity analysis,
probabilistic assessments and decision analysis.Acres I current approach
needs some improvement as it is narrowly focused.The External Review
Panel would like to review in October,progress in developing a consistant
approach to evaluating alternatives under uncertainty.
The issue of financing mechanisms for the Susitna project and the corre-
sponding electric rates to the customers needs further analysis.Because
of the financial risks,it is likely that the Susitna project cannot be
financed without support in the form of equity participation,guarantees
and the like by the State of Alaska.A determination of available and
likely financing mechanisms needs to be further developed by Acres and
available for review in October.
If the Susitna project is financed through direct state funding,and the
corresponding rates for electricity are set less than the cost of gas or
oil heating,there will be economic incentives to convert to electric heat.
This would greatly accelerate the demand for electricity and have a major
impact on Susitna and other power projects.The full impacts of this case
need to be investigated.
From an economic viewpoint,it appears that gas is the competitive alter-
native to the Susitna project.Chugach Electric Association,which repre-
sents about half the power requirements for the Railbelt region,is favorably
disposed to this gas alternative.The gas,reserve situation and future
prices for gas needs further investigation.Particular emphasis should be
given to understanding potential long term contracting agreements for gas
from the oil and gas companies.
The Panel would like to examine the criteria that FERC will employ in the
market and economic area to be certain that Acre1s report fully addresses
these issues.
AGENDA FOR NEXT MEETING
The next meeting of the Panel is tentatively scheduled for the week of
October 5,1981 at the Acres Buffalo location.The Panel desires to make
the following recommendations regarding this meeting:
9
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1.A site visit should be made by Panel members who desire to do so
before the October 5th before the full meeting.
2.Geotechnical problems should be resolved and discussed in more
detail.
3.Results of design development studies for various alternatives
schemes should be discussed in more detail.
4.Environmental study results should be presented and discussed
more fully.
5.Battelle should present the results of their studies for Panel
consideration.
6.Consideration should be given to having a FERC representative
attend the meeting if this will be useful in speeding up their
review process and earlier license approval.
CLOSING REMARKS
The Panel expresses its appreciation to the staff of the Alaska Power
Authority and the staff of Acres American Incorporated for the many cour-
tesies extended during the meeting.
;,
Jacob H.Douma
Ciu&lIJO QJ~
Andrew H.Merritt
,~
enni s r,1.Rohan
10
H.Bolton Seed-~==
Octoher 8,1981
SUSITNA HYDFOELECTPIC PROcTFCT
EXTERNAL REVIEW Pl\NETr
REPORT NO.3
INTPoDucrrIoN
The third meeting of the External Review Panel for the
Susitna hydroelectric Project wns convened on October 6-8,
1981 at the Acres American office in Buffalo.In addition
to Panel Members,representatives of the Alaska Power
Authority and Acres American were present.Various members
of the Acres American staff presented discussions regarding
progress in geotechnical areas,seismicity,hvdraulics,
hydrology,and design.The djscussions were well prepared
and presented in such manner as to give a maximum amount of
information in a reasonable time.
Prior to the meeting Panel Members received a document
entitled "Susitna Hydroelectric Project,External Review
Board,Meeting #3,Information Package,October 6-8,1981~.
During the meeting other printed information was presented
to the Panel as required.
The Panel appreciates
Staff in planning and
and successful meeting.
the efforts of the A.cres American
preparing for this very informative
-
2
SEISMICITY AND SEISMIC GEOLOGY
Excellent progress has been made c1urinCT the summer months in
resolving most of the uncertainties regarding the possible
presence of active faults in the vicinity of the dam sites,
in developing an adequate model of t,he seismic geology of
the region,and in assessinc::r the maximum levels of
earthquake shaking which could result from events occurring
along the major seismic sources.These studies have led to
the followina preliminary conclusions:
v~ATANA DAIvl S ITF.
Four malar lineaments were 'oriqinallv idcntifien as heinq
possible faults in the vicinitu of the clam:
(I)The Talkeetna Thrust Fault
(2)The Fins Feature
(3)The Susitna Feature
(4)The Watana River Feature
Field geologic studies during the past several months have
developed evidence indicating that:
and
(1 )
(2 )
(3 )
(4 )
The Talkeetna Thrust Fault is not an active fault.
The Watana River Feature is not a fault.
The Susitna Feature is not a fault.
The Fins Feature may well be a fault but it is
relatively short in length and,since there are
apparently no other active faults in the area,it
is very unlikely that it could be active.In any
case its length would preclude the possibility of
it being the source of a significant earthquake.
In consequence,there are apparently no active faults
crossing the site and the major sources of earthquake
shaking at the site may he attributed to earthquakes
occurring on the Benioff Zone unCierlying the site at depth,
the Denali fault,the Castle l'1ountain Fault,and smaller
local earthquakes occurring with no apparent surface
expression in the crust of the Talkeetna terrain.
Considerations of fault distances ane'!possible earthquake
magnituCies leads to the conclusion that the approximate
maximum levels of shakinq from the different sources will be
as follows:
SourcE"
Benioff Zone
Benioff Zone
Denali Fault
Local Event
Closest Distance
:co 63 km
==48 km
~70 km
*
~1aqni tude (Hs)
'"8~'i
'"7 ~7
'"8+
*
Peak Ace.(Mean)
'"0.35g
:::O.32g
:co O.22g
*
*Information to he proviClee'!ln Final wee Pennrt
3
Seismic geology considerations have led Woodward-Clvde
Consultants to suggest that the maximum local earthquake
which needs to be considered is a Magnitude 5~to 6 event
occurring at a distance of about 10 km from the site.Such
an event would produce a peak acceleration (mean value)of
about 0.35g and would therefore not be a controlling event.
However,the Panel believes that in view of the past seismic
history and other considerations it would probably be
prudent to'consider the possibi-li ty of a somewha't la rger
event C1.t c"51 ightly shorter distance.In this case the
local earthquake would be responsible for the maximum
acceleratjons likely to develop at the dam site.This does
not mean however,that it will necessarily control the
design.
For the Benioff Zone event,
this stage,the motions
Consultants for preliminary
entirely appropriate.
DEVIL CANYON SITE
which seems to be controlling at
recommended bv Woodward-Clyde
design evaluations appear to be
At the end of 1980,nine lineaments were identified in the
vicini ty of the Devi 1 Canyon site which could possibly be
active faults.Field geologic studies during the past 6
months heve led to the conclusion that only 3 of these
features are faults,that the three features recognized as
faults are inactive,and that in any case they are so short
in length that they could not generate earthquakes which
would b0 controlling events with regard to earthquake
motions at the dam si te.Thus since there are no acti ve
faults In the vicinity of the dam site,the desiqn
earthquake motions will be determined bv similar
considerations to those applicable for the Watana site.The
Panel agrees with these conclusions.
Consideration of the most significant seismic sources of
ground shaking leads to the following:
Source
Benioff Zone
Benioff Zone
Denali Fault
Local Event
Closest Distance
c:'90 km
-S8 km
--G4 km
*
Haonitude (Ms)
c:'8~
c:'
7 1_
I ':::-
c:'8+
*
Peak !'~cc.(Hear
~O.3q
_.O.3g
~0.2 4g
*
As for the VJatana si te,there is a need to establish very
soon the significant characteristics of the local earthquake
lin the crust of the Talkeetna Terrain)in order to finalize
the seismic criteria to be used for project design.
*To be provided ill Fin2:11 viCC Report
4
In light of the information presented at this meeting and on
the basis of past experience,the PaneJ believes that
through the use of appropriate design and construction
procedures,dams with ample margins of seismic safety can be
cons rue ted at both sites.The Panel helieves,however,
that the question of seismic effects due·to local crustal
earthquakes should be resolved in the next few weeks so that
more definitive design studies can be completed.
POCK ENGINEERING CONSIDERATIONS
As a result of discussions durinq this meeting as well as
observations made in the field bv Panel member Merritt
during the period of 23-25 September,we have the following
comments regarding present designs.
'dATANA
Every effort should be made to reduce the height of the cut
slope at the inlet to the diversion tunnel.The structures
can probably be moved closer to the river and perhaps
shifted slightly in a downstream direction.
The surface excavation at the outlets of the tailrace
tunnels and spillway structures is likewis~very extensive.
Further detailed examination is warranted to minimize
possible slope stability problems.
*To be provided in Final wec Report
,....
Recent borings in the proposed underground powerhouse slte
encountered a zone of soft hy~rothermally altered diorite.
This is not acceptable material to have in a major
underground excavation.Some shifting of these openings is
required.Considering all borings made in the right
abutment,the general quality of the diorite is auite high
and we foresee that acceptable rock can be found for the
proposed structures.
DEVIL CANYON
The o,raywack.e and argilli te at this site appear to be of
acceptable quality for the proposed underground structures.
No maj or shear zones have been recognized in these areas.
The underground openings have been oriented with respect to
the major known joint systems and bedding planes.The
present layout is acceptable and it is recognized that some
slight shift could result based upon the results of future
exploration.
The axis of the proposed surface spillway on the right
abutment will nearly paralle]the strike of the bedding of
the rock.The required cuts will daylight the bedding which
dips at about 50 degrees into the excavation.Potential
----------------"""'r---
major rock stability problems could
be solved by simple rock hoI tinq
likewise requires your review.
BURIED CHANNEL
5
resuJt which miqht not
measure s .Th i S oe sign
....
I
The results of all geophysical surveys compJeted to date
have defined a major channel beneath the plateau on the
right abutment at the Watana site.The channel is
approximate Iv 15,000 ft wide when measured with respect to
that portion of the bedrock channel below the proposed
reservoir pool level.The deepest portion of the channel
lies about 450 ft below pool level;however,perhaps as much
as 60-70%of the channel lies 100 ft or less helow maximum
pool level.
The borings completed during the Corps of Engineers study
indicated that the channel is filled with glacial till,
au t"vash,and perhaps lacustr ine deposits.The boring logs
show that boulders (some as large as 12 ft)can be expected
in these heterogeneous deposits,either as individual units
or as thi.ck layers.Contour maps made of the bedrock
surface suggest a wide entrance channeJ or channels upstream
of the damsite and a relatively narrow exit int.o 'I'susena
Creek downstream of the damsite.
The buried channel on the north slope of t.he reservoir at
Watana Dam is much greater in extent than was anticipated a
year ago and represents one of the greatest.uncertainties
associated with the Watana Dam project.Major problems
posed by the presence and extent of this channeJ are
(1)The magnitude of possible seepage Josses through
the channel.
(2)The possibilj.ty of oiping within the channel
resulting from seepage from the reservoir towards
Tsusena Creek.
(3)The possibility of seismic instability in the
soils comprising the buried channel under strong
earthquake shaking.
It appears that.problems (1)ano (2)above could be
eliminated bv construction of a cut-off walJ and grout
curtain throuqh the soils filling the channel.However,the
provision of such a cut-off wouJo not solve any problems of
seismic instability on the upstream side of the wall.
since very J i ttle information lS avaiJ able concerning the
nature of the soils forming the channel fill it is not
possible to assess the magnitude of the seismic instability
problem,if indeed it exists at all,.or the need for an
extensive cut-off wall,currently projected to be about
15,000 feet long and varving from a few feet to 450 feet in
depth.However,it is clear that both the possibilitv of
,,__..'~~IIlI '----~--_____"''''''"",,'''1'''---:_.-------'111'.,~------,------
6
seismic instability and the cost~of a cut-off would be
dramRtically reduced if the reservoir level were about 100
feet lower than currently planned.Such Cl lowering could
reduce the length of the cut-off to about 4,000 feet,
facilitate its construction,and by lowering the water table
in the soils,increase their seismic stabilitv.In view of
these advantages,together with the fact that economic
advantages associated with the top 50 to 80 feet of Watana
Dam do not appear to be very grou.t,the Panel believes that
careful consideration should he given to the potential
benefits of reducing the height of Watana Dam bv 50 to 100
feet.Such a reducecl heiqht might also facilitate layout
problems for the dam.
The Panel cannot be sure that a rpduction in dam height
would be ac1vantageous but bel ioves that a carefu]study of
the question is warranted in the next several months.
\'JA'rANA DAM EHBA.NKMENT
The Panel believes that the preliminary design section
selected for Watana Dam is satisfactory and will produce a
stable and economical structure.It J_S suggested however,
that consideration be given to the following items:
(2)Deformations of the upstream shell of the dam due
to strong earthquake shaking can be ~inimized
ei ther by densifying the shell material to such
extent that high pore pressures cannot develop or
by using hiahlv pervious rock-fill which will
dissipate any pore pressures resulting from
earthquake shaking almost as rapidly as they
develop.Consideration should be given to using
gravel-fill and rock-fill in the upstream shell in
such a way as to optimize their use from a seismic
design point of view.
If the shells are constructed of densely compacted
gravel or rockfill and the core of a much more
compressible sandy-sil ty-clay,there is a danger
of deleterious stress redistribution due to
differential settlements.Consideration should be
given to minimizing this possiblitv by:
(1)
and/or
(a)
(b)
inclining thp core slightly upstream,
providing this can be done without
jeopardizing stability.
locating a reJatively incompressible
core material which is adequately
impervious.Such a materia]appears to
be available as a GC material in one of
the borrow ar~as.
'..
",,'4~~_..__....•..~"~....._~_,..•_..•_~_.~
7
(3)
( 4 )
There 1S apparently lce in the rock ioints in the
abutments at Watana Dam ~ite and this will have to
be thawed before groutinq.It would be desirable
to determine whether construction costs have
allowed for this.
It appears that there mew well be permafrost in
the foundation soiJ.5 for the saddle-dam.When
this melts it coulc leave the soils in a very
loose condition which may be adequate for static
stabi 1 i ty but inacleQua te for sei smic stabi 1 i ty.
It would be desirable to explore ·this possibility
further and examine the need for excavation of
frozen foundation soils prior to saddle-dam or
dike construction.
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DEVIL CANYON DAM
Sufficient study has been completed to adequately support
the present arch dam design for feasibility purposes.
However,the linear feature through the pond areas where the
wing dam will be located should be further explored in the
near future.Similar considerations to those discussed for
the Watana Site should be given to t.he foundation soils
under the Devil Canyon wing dam.
WATANA DAM DIVERSION TUNNELS
Two diversion tunnels are proposed for diverting up to a 1
in S-year flood during construction of Watana Dam.One
tunnel would be located at a low level so that it wouJd flow
full at all times.The second tunneJ,Jocated at a higher
level,would have free flow.After diversion the lower
tunnel would be plugged.Two plugs would be constructed in
the upper tunnel with gated outlets through them to permit
relea se 0 flow flows unti 1 Devi 1.Canyon is completed and
serve to lower the reservoir in case of an emergency.The
Panel concurs in the general concept of the diversion
tunnels and modification of the high level tunnel for use as
a low-flow and emergency release out.let,suh-;ect to
refinements discussed by Acres.
Spillway flows at \'Jatana Dam would b",handled by three
separate fJow release structures.Discharges corresponding
up to a 1 1n lOO-year flood woulc be released through.a
low-level tunnel controlled by three or more Howell-Bunger
or sim1lar valves located at the downstream end of the
t.unnel.Discharges corresponc'1ing to floods in excess of 1
in IOO-years and up to 1 in IO,OOD-years would flow through
".........~....__•_._,_""""'a..:lOliO_....Q~';~r-b 11 +-0 ('p';1 ,r.,z~):.7 j +-tQ...,.,;;.fO 1 j n bll C lr "'j-~b.6lroo sin
8
The Panel concurs in the proposed concept of handling
spillway flows.Release of floods up to I in IOO-years by
low level valves would maintain the nitrogen supersaturation
level to an acceptable limit.The Panel suggests that fixed
cone valves as installed by the Corps of Engineers at New
Melones Dam be used,since their greater rigidity makes them
more sui table for high-head operation.The smaller chute
spillway flows would reduce erosion in the downstream river
channel.Hydraulic model tests will be required to
determine the extent of material that should be
pre-excavated in the plunge pool area.In view of the
infrequency and short duration of spillway operation and the
relatively high quality of rock in the steep river banks,
the Panel is of the opinion that excessive erosion would not
occur due to service spi 11wa.y operation.l'li th respect.to
the emergency spillway bypass channel,the Panel is
concerned over the 45-ft height of the fuse plug.This high
pI ug would need to be designed a s a small earth dam to
retain the power pool at maximum levels ano also be capable
of failure as a fuse plug when it is overtopped.It is
suggested that the entrance to the bypass channel be
widened,thereby requiring a smaller height of fuse plug.
This would also reduce the amount of reservoir lowering in
the event of fuse plug failure.
DEVIL CANYON DIVERSION TUNNEL
One diversion tunnel is proposed for Devil Canyon Dam to
divert flows up to a 1 in 50-year flood during dam
construction.The tunnel would be plugged after it is no
longer needed for diversion.The Panel suggests that this
tunnel could be used for spillway flow releases in an
alternative spillway design discussed hereinafter.
DEVIL CAJ'IYON SPILLWA_YS
As for Watana Dam,spillway flows at Devil Canyon would be
handled by three separate f]ow release structures.Flows up
to the 1 in IOO-year flood would be released by four or five
outlets through the base of the concrete arch dam controlled
by Howell-Bunger or other typE':'high pressure valves.
Discharges in excess of 1 :in lOO-years ano up to ]in
IO,OOO-years would flow through an open chute spillway with
a high level flip bucket.Discharges in excess of the 1 in
IO,OOO-year flood up to the PMF would pass through a bypass
channel controlled by a fuse plug.
The Panel concurs in the concept of handling the spillway
f 10\',1s subj ect to the question rai sed below.Release of
small flows through valves at the base of the dam will
prevent excessive nitrogen supersaturation in the downstream
river channel,as well as reduce discharges and flow
frequency and duration in the chute/flip bucket spillway,
thereby reducing plunge pool erosion.Based on a ground and
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9
air inspection of the river channel at the Devi]Canyon Site
by Panel member Douma and Acres representatives on
September 17,1981,the Panel is of the opinion that the
very high quality rock in the canvon walls should not
experience excessive erosion due to spillway operation.In
this case,pre-excavation of streambed material and
weathered rock is probably not required.The Panel is
concerned,however,over the deep sidehill rock cut required
for construction of the spillway chute.It suggests that
consideration he given to provic'Jing spillway tunnels,as
required l instead of the chute spillway.In this alternate
plan,the diversion tunnel and probably only one additional
tunnel vlOuld be required.With respect to the emergency
bypass channel spillway,the Panel is concerned over the
57-foot high fuse plug for the reasons stated for the Watana
fuse plug.Consideration should be given to increasing the
length and reducing the height of this fuse plug as
described for Watana.
DEVIL CANYON POWERHOUSE TAILRACE
The Panel concurs in extendinq the tailrace for the Devil
Ca.nyon powerhouse about 1l.;mile to take advantage of the
additional approximately 30 feet of head.
CLOSING RENAFKS
The )anel requests that the topics raised in this report be
thoroughly discussed in the next External Review Board
Meeing t.entatively scheduled for the week of January 11,
1982 in Anchorage.
The Panel greatly appreciates the
to it by the staff of the Alaska
staff of Acres American,Inc.
many courtesies extended
Power Authori ty and the
(,"\,'/r,0 n "
"_'J"_'-J,£IJ.),..u_'I.(".:0...J _.Q..<"'~
Andrew H.Merritt1..tl'I,.,{;:>t'c-·~~,
Jacpb H.Douma H.Bolton SeeP'.
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January 13,1982
SUSITNA HYDROELECTRIC PROJECT
EXTERNAL REVIEW PANEL
REPORT NO.4
INTRODUCTION
The fourth meeting of the External Review Panel for the Susitna
Hydroelectric Project was convened on January 12-13,1982 at the Alaska
Power Authority office in Anchorage.In addition to Panel ~1embers,
representati ves of the Alaska Power Authority and Acres Ameri can were
present.Vari ous members of the staff presented di scuss ions regardi ng
progress in geotechnical areas,seismicity,hydraulics,design,and
economi cs.
Prior to the meeting Panel Members received documents entitled
IIS us itna Hydroelectric Project,External Review Board,Meeting #4,
Informati on Package,January 12-13,1982 11
;IIS US itna Hydroel ectri c
Project,Acres Specialist Consultants Panel,Report,November 18,1981 11
;
and IIFinal Report on Seismic Studies for Susitna Hydroelectric Project,
February 1982,prepared by Woodward-Clyde Consultants ll
•
A separate meeting was held in Bellevue,Washington on January 14
and 15,1982 to review Battelle's preliminary findings of alternatives
to the Susitna project,and to be briefed on the status of Acres'work
regarding demand forecasts,economic evaluation,risks analysis,and
financing considerations.Representatives from Alaska Power Authority,
Acres,Battelle,and Dr.Rohan from the External Review Board attended
the meeting.A report on that meeting is attached.
Similarily,a separate series of meetings were held in Anchorage,
Alaska to review the project environmental aspects.Representatives
from Alaska Power Authority,Susitna Hydroelectric Project Steering
Committee,Acres American Incorporated,various resource management
agencies and Dr.Leopold attended these meetings.A report of those
meetings is attached.
The Panel appreciates the efforts of the Acres Ameri can staff in
planning this meeting and preparing the discussions presented therein.
SEISMICITY AND SEISMIC GEOLOGY
The seismic geology and seismicity studies have progressed satis-
factorily since the last meeting of the Panel.At that time,the major
sources of earthquake ground motion had been determined and the only
remaining uncertainty was the establishment of the significant charac-
teristics of the local earthquake (occurring in the crust of the Tal-
keetna Terrain)which could affect the design of the dam.
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Woodward-Clyde Consultants have addressed this issue in their draft
of the "Final Report on Seismic Studies for Susitna Hydroelectric
Project"and in their presentation at this meeting.They term this
source lithe detection level earthquake ll and conclude that such earth-
quakes would have a magnitude of 6 and could possibly occur very close
to either dam site.
Based on this conclusion and other known sources of earthquake
ground motions,recommendations have been presented concerning the level
of ground motions which project structures should be designed to with-
stand.These are presented in terms of mean response spectra and the
Panel considers the recommendations for mean ground motions to be
entirely appropriate.We would note,however,that "cr itical ll struc-
tures such as major dams are normally designed to withstand earthquake
motions at about the 80 percentile level and the characteristics of such
motions should be developed and considered in evaluations of the seismic
stability of the project structures.
The Panel has considered the characteristics of possible motions
resulting from earthquakes on the various sources (Benioff Zone,Denali
Fault,Castle Mountain Fault,and Talkeetna Terrain)and concludes that
it is feasible to design both the gravel-fill dam at Watana and the
concrete arch dam at Devil Canyon,as well as the appurtenant struc-
tures,to safely withstand the effects of such earthquake shaking.
WATANA DAM EMBANKMENT
The Panel believes that the design section for Watana Dam,presen-
ted at this meeting,is satisfactory and will produce a stable and
economical structure.With regard to the questions raised in our
previous report,we note that:
(l)It is proposed to construct the core with the well-graded
glacial moraine material from Borrow Area 110 11 •This material
is satisfactory for construction of an impervious core and
further studies of its properties can be made in the design
stage.
(2)It has been decided to use an essentially vertical core with a
width sufficiently large to prevent arching of the core caused
by differential settlements between the core and the shell
materials.
(3)It is proposed that the upstream shell be constructed of
compacted clean river alluvium gravels,this material being
processed to ensure that not more than 10%of the material is
less than 3/8"in size,in order to provide a high coefficient
of permeability and thereby facilitate rapid dissipation of
any pore water pressures generated by a seismic event.This
treatment,together with placement in 2 ft.lifts,should
ensure adequate stability for static and seismic loading
conditions.
2
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(4)The crest level of the dam and associated reservoir levels
have been lowered by 30 feet so tha t the saddl e dike has no
water retaining function except in the case of the probable
maximum project flood.This change greatly reduces the
significance of foundation stability associated with the
thawing of permafrost zones in the foundation of the saddle
dike after reservoir filling.
BURIED CHANNEL
In our Report No.3,we noted potential problems posed by the
buried channel to be as follows:
(1)Nagnitude of seepage losses through the mixed glacial and
alluvial deposits.
(2)Piping of these materials towards Tsusena Creek.
(3)Seismic instability of the soils under strong earthquake
shaking.
Acres has addressed these concerns and has concl uded that:a)
seepage losses are not significant,b)piping can be controlled if
necessary by filter blankets placed on the slopes adjacent to Tsusena
Creek,and c)seismic instability or liquefaction is not a problem,
especi a lly since the saddl e dam has been reduced in hei ght and the
reservoir level lowered 30 feet.
At this stage in the project,only limited information is available
on the engineering and geological properties of the materials within the
channel.Thus any present assessment of seepage,piping,and lique-
faction potential is based upon the broadest assumptions.
The External Review Panel continues to believe that the behavior of
the buried channel under full reservoir as well as seismic events is
important to the performance of the project.However,the 1ack of
specific knowledge of material properties at this time does not compro-
mise project feasibility.In our opinion,technical solutions are
available to handle the concerns mentioned above at a reasonable cost.
These solutions might include a filter blanket,partial or complete
cut-off,pumping to reduce porewater pressures,or possible densifi-
cation of loose soils.The potential for liquefaction increases with
the height of the reservoir or increase in water level in the channel
soils.Thus any further economically justifiable reduction in dam
height has positive geotechnical benefits.
The External Review Panel gives its unqualified support to on-going
exploration within the channel area.We agree with Acres that borings
are required to define the extent and properties of the various antici-
pated deposits.We also believe that once defined,large scale pumping
tests will be required to determine general values of permeability.
Acres has noted that buried channels have been found on other projects
which have not permitted large water losses or caused piping when the
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reservoi r was fi 11 ed.They have agreed to document these cases and
present this information prior to our receipt of the feasibility report.
DEVIL CANYON DAM
The Panel requested in its Report No.3 that the 1 inear feature
through the pond areas adjacent to the Devil Canyon damsite,where the
wing dam will be located,be further explored in the near future.Acres
agrees that the investigation is necessary but,because of time limita-
tions,they are unable to conduct this work prior to submission of their
Feasibility Report.They do not believe that delaying this inves-
tigation will affect the feasibility of the project.We concur.
WATANA DAM SPILLWAYS
In its Report No.3 the Panel concurred in the concept of handling
spillway flows at Watana Dam by three separate flow release structures,
as follows:discharges corresponding to floods up to the 1 in 100-year
flood through a tunnel controlled by downstream valves;discharges
corresponding to floods in excess of 1 in 100 years and up to 1 in
10 ,ODD-years through a gated chute spi 11 way with a fl iP bucket;and
discharges in excess of the 1 in 10,OOO-year flood up to the probable
maximum flood through an emergency fuse plug spillway.
The Panel suggested that fixed cone valves be used instead of Howel
Bunger valves for the tunnel spillway because fixed cone valves give
better service for high-head operation.The Panel also suggested that
consideration be given to adopting a wider entrance and lower fuse plug
for the emergency spillway.These two suggestions have been adopted.
The Panel concurs in the general layout of a manifold at the downstream
end of the 28-foot diameter low flow spillway tunnel with six 8-foot
diameter conduits each terminating with a 96-inch fixed cone valve.We
also concur in the proposed wider entrance to the emergency spillway
with the lower 31-foot high fuse plug.
The service spillway is designed so that in combination with the
tunnel spillway the 1 in 10,000-year flood will have a maximum reservoir
el evati on of 2193.The correspondi ng servi ce spi 11 way di scharge is
114,000 cfs.Since the fuse plug crest would be at elevation 2200,
discharge through the service spillway would continue to increase until
the reservoir level reached about elevation 2202,at which level the
discharge would be 147,000 cfs,which is the discharge being used for
design of the service spillway.Thus,the low-flow tunnel spillway and
service spill~ay would handle a flood somewhat larger than a 1 in 10,000
year flood.The Panel suggests that consideration be given to reducing
the size of the service spillway so that in combination with the tunnel
spi llway the 1 in 10,000-year flood woul d have a maximum reservoi r
elevation of 2202.This should result in a substantial saving in
service spillway cost.
WATANA SERVICE SPILLWAY CHUTE
Consideration should be given to providing concrete paving for a
short distance on the invert of the approach channel upstream of the
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ogee crest.Four aeration slots in the chute invert should be located
at approximately stations 5+00,10+00,14+00 and 17+00.A small ramp
should be located just upstream of each slot.The slots should be open
on top and a bevelled curved surface should be provided from the down-
stream edge of the slots to the main invert slope.The slot design
should be similar to that developed for Tarbela dam at Colorado State
University in a 1:12 scale model and found to function satisfactorily in
the prototype.
DEVIL CANYON SPILLWAYS
In its last report,the Panel suggested that fixed cone valves be
used instead of Howell Bunger valves for the low level spillway outlets.
The Panel al so suggested that the entrance to the emergency spi llway
channe 1 be wi dened and the fuse pl ug hei ght be reduced.These sug-
gestions have been adopted.
The Panel suggested that consideration be given to using one
diversion tunnel and an additional tunnel instead of the gated chute
service spillway for release of spillway discharges between the 1 in
100-year and 1 "in 10,000-year floods.Acres has studied this alterna-
tive and found it to be significantly more costly.The Panel is satis-
fied that a tunnel spillway is not an economic alternative.
SEDIMENTATION AND RIVER MORPHOLOGY STUDIES
Panel member Douma met with R &I~Consultants,Inc.and Acres
representatives in Anchorage on December 9 and 10,1981 to review
reservoir sedimentation,sediment yield and river morphology studies for
the Susitna Hydroelectric Project.A report dated December 10,1981 was
prepared and submitted to the Alaska Power Authority.
The report generally concurs with the study's main conclusions,as
follows:
(1)Reservoir sedimentation would be of little concern to the
'project as less than 5 percent of the reservoir storage would
be depleted in 100 years and much of the depleted storage
would be below the dead storage level.
(2)It will be important to identify locations in the Susitna
River main channel between Devil Canyon and the Chulitna River
confluence where post-project channel conditions may be
detrimenta 1 to the fi shery and whether or not remedi a1 work
can be accomplished at reasonable cost to minimize damage to
fish spawning areas.
(3)Sediment analyses indicate that there will be some change in
sediment loads in the river reach from Devil Canyon to the
Talkeetna confluence but sediment loads in the lower Susitna
River downstream of the confluence will be essentially the
same for pre-and post-proj ect condi t ions due to the long,
wide,gravel flood plain and large sediment loads transported
by other tributary streams into the lower Susitna River.
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(4)Stages of 1.5 to 3.5 feet lower,depending on the reach in the
lower Susitna River,will occur after flow regulation which
should not cause major flooding and navigation impacts.
(5)Under post-project conditions,the frequency of occurrence of
dramati c changes in ri ver morphology wi 11 decrease,resulti ng
in a more stabilized flood plain,a decrease in number of
subchannels and an increase in vegetative cover.
It should be recognized that changes in morphology of the lower
Susitna River due to project construction are extremely difficult to
quantify with a high degree of reliability.The analyses which have
been made,however,lead to a better understanding of the natural
processes and the changes that may occur due to project construction.
Future studies should include monitoring the river conditions by data
collection and observation of changes for a considerable period of time
after project construction.
The External Review Panel is impressed with the excellence of the
studies made by R &M Consultants,Inc.,and bel ieve that the study
conclusions,in spite of the general sparsity of basic data,are quite
reasonable.
CLOSING REMARKS
The Panel is of the 0plnlon that the outstanding topics discussed
in this report must be resolved in the very near future.It is there-
fore suggested that Panel Members meet with the Acres Specialists
Consultants Panel on February 17-18,1982 in Buffalo to reach agreement
with Acres American on the unresolved issues.
The Panel appreciates the courtesies extended to it by the Alaska
Power Authority and Acres American,Inc.
Merlin D.Copen
Jacob H.Douma
6
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March 1,1982
SUSITNA HYDROELECTRIC PROJECT
EXTERNAL REVIEW PANEL
SUPPLEMENT TO REPORT NO.4
Introduction
On January 14th and 15th,staff from A,cres and Battelle met \'/ith
representatives of Alaska Power Authority ann Or.Rohan of the External
Review Panel to Access:
o The preliminary results of the Battelle study.
o The status of Acres'Work in this area.
Prior to the meeting,draft reports were received for review from
both Acres and Battelle ~nd were reviewed by Dr.Rohan.
Battelle Report
The report from Battelle focused on the future demand for power in
the Railbelt region,alternative plans for power generation to meet this
demand,fuel availability and costs,and the comparative economics of
these plans.
In deve 1ooi no a range of 1aad forecasts,Batte"e extended the
modelling approach of ISER and developed three basic cases each based on
a different level of economic growth in Alaska.(Each level of economic
qrowth is related to state revenues and correspondinoly to the outlook
for worl d oil pri ces.).-
Each case provided a projection of the demand for peak power and
energy on a year-by-year basis to the year 2010.Average annual growth
in demand was projected to range from 2.2%to 4.5%per year.This range
seems reasonable.
Price forecasts were developed for oil,gas,and coal.The oil
prices showed a real increase in price from 1%to 3%per year.Because
of currently depressed oil markets,actual oi 1 pri ces over the next
several years could be lower than projected.Future 9as prices were
estimated for gas from the Cook Inlet and the North Slope.These gas
forecasts were based on a combination of requlatorv considerations and
market forces.Coal prices were forecasted to increase in real terms at
about 1%to 3%per year.The range of price forecasts for oil,gas,and
coal is consistent with a consensus forecast of experts in 1980;how-
ever,the higher ranges seem less likely in today's environment.
To meet the pro,iected demand for power,Battelle investigated a
wide variety of energy sources.These sources included a combination of
thermal power from coal and gas;hydropower from Bradley Lake,Chaka-
chamna and Susitna;and wind energy,tides,etc.Separate capital and
operating cost estimates were made for each of these alternatives.
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Battelle's economic analysis compared the levelized annual cost of
power generation for six technically feasible plans.Two of these plans
included the Susitna project as a source of power.Each of the six
plans was designed to meet the power requirements for the medium-load
growth forecast.
Battelle1s primary conclusion regarding the economics was that the
cost of power for all six plans was essentially the same (58 mill/kWh
versus 59 mills/kWh in 1980 dollars).Comparisons of levelized annual
costs were made over a 30-year period,1980-2010.C'n a year-by-year
basis,the two plans thClt included the Susitna as a source of power
showed a slight decline in annual electric costs starting in approxi-
mately the year 2000.All plans would result in a near doubling in the
real cost of electricity by the year 2005.
Battelle's analysis of alternative qeneration schemes and conserva-
tion potential was relatively complete."However,the time horizon of 30
years does not fully capture the true er.onomic benefits of hydro-
facilities,which have useful lives of 50 years or more.In February,
Battelle issued a draft comment report on its findings and incorporated
this longer time horizon.
Acres Report
Representatives from Acres presented their prel iminary economic
analysis,risk assessment,and financial analysis of the Susitna pro-
ject.
Acres I economic analysis compared the present worth of the costs of
a Susitna project with a thermal plan using coal for base load gener-
ation.
Acres'analysis employed a more rigorous optimization approach to
systems planning than did Battelle's analysis.Nevertheless,Acres'
findings are essentially consistent with Battelle's.Over a 30-year
time horizon,both the Susitna and thermal unit projects would have
essentially the same cost.
On a 60-yea r time hori zon,whi ch is more appropri ate,the Acres'
analysis indicated that for the medium-load forecast the Susitna project
would yield a net benefit over the thermal plan of about $1.1 billion
(in 1982 dollars).Poth Acres and Battelle's analysis excludes any
marketing or financial risks.These risks are substantial and could
alter the comparative economic advantages of the Susitna data.
Furthermore,the computed net benefits are highly sensitive to:
o Load forecasts
o Fuel prices escalation
o Real interest rates and discount rate
o Capital cost of the Susitna project
For example,if the real discount rate is increased from 3%to 4%
per year,then the net economic benefits of the Susitna project are
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eroded to zero.As a second example,if the lower load forecast is
used,the benefits of the Susitna dam decreases to $0.2 billion.
Because of this high degree of sensitivity and uncertainty in these
key variables,it was agreed that Jl.cres,in its final report,would (a)
show the sensitivity analysis,and (b)incorporate a probabilistic
assessment of the likelihood of the various economic outcomps.
Acres'analysis of risks was limited,and f'ocuspd on the capital
cost and construction risks in building the Susitna dam.Although the
qual ity of the work on these constructi on ri sks appeared to be excel-
lent,the concept of risk needs to be broadened to incorporate the major
load,marketing,and financial aspects of the Susitna project.
The financial analysis and market assessment study was in its
preliminary stage.Even from its initial work,it is clear that the
financial and marketing risks are critical to the project feasibility.
Unless there is a form of state equity funding or guarantees on a least
50%of capital costs,the project feasibility becomes highly unlikely.
This implies state participation in the amount of at least $2.5 billion
(1982 dollars).
This infeasibility is caused by the problems of marketing the
initial high cost of power generated by the Susitna dam,and general
problems of contracting to organizations with different economic inter-
ests.It is also related to the uncertainties in the market rate of
interest for bonds and the inherent risks of financing large capital
projects in an inflationary environment.
Subsequent to this meeting,there was another meeting with Acres,
the investment advi sors of Al aska Power Authority,representatives of
Alaska Power Authority,and Dr.Rohan.This meeting was helc1 in Seattle
on February 19th to review the substantial progress on the financial and
marketing aspects of the Susitna project.
Respectfully Submitted
Dr:Dennis Rohan
,~
February 4,1982
SUSITNA HYDROELECTRIC PROJECT
EXTERNAL REVIEW PANEL
SUPPLEMENT TO REPORT NO.4
Durin9 the three day period L1anuary 18-19-20,I visited the APA
offices in Anchorage where I had the opportuni~y.to confer with repre-
sentatives of Acres,TES,Mitigation Core Groups (both Fisheries and
Wildlife),and the Susitna Hydro Steering Committee,consisting of
representatives of state and federal agenci es.Additi ona lly,I had
individual meetings with David Spencer and William Wilson of U of A,Al
Carson of Alaska Department of Natural Resources,and David Cline of
National .nudubon Society.Prior to this trip I reviewed a number of
reports on Environmental (Task 7)and Hydrology (Task 3)studies.The
notes which follow are a synopsis of my thoughts on some environmental
issues in the proposed Susitna project.Most of these concern fisheries
and th~river itself below the impoundments.
Fisheries
The section of the Susitna River that will be most altered in flow
characteristics and in morphology is the reach from Devil Canyon dam
down to Talkeetna.The normal summer flow of 25,000 cfs will be with-
held behind the dams and released at a reduced rate which will alter the
shape and depth of the channel and will possibly preclude flooding of
side channels that are important for salmon spawning and rearing.I am
not clear as to the projected post-project flow.In various meetings I
heard reference to flows as low as 5,000 cfs and as high as 12,000 cfs.
The adverse impact on salmon will be minimized if reasonably high summer
flows are permitted during the two months of salmon spawning.Special
care will be required to maintain salmon spawning habitat during the
period when the reservoirs are filling.I would like to see a firm plan
of how flow is to be regulated from the time construction begins on
Watana Dam until Devil Canyon Dam is completed and filled.
Water temperatures in the river below Devil Canyon may be important
in stimulating or inhibiting salmon spawning and fingerling development.
I would like to see better data on present seasonal water temperatures
and a plan for regulating temperature in released water after the
project is completed.It would appear to me that a multiplelevel inlet
from Devil Canyon reservoir would be essential if water temperature is
to be manipulated.I understand that such an inlet is not currently
planned.
The vertical descent of water discharged from both Watana and Devil
Canyon dams is so great as to pose a threat of supersaturation of
nitrogen.I am told that outflow structures ca~be designed to circum-
vent this problem.I want assurance that such is being done.
Assuming that some spawning habitat will be lost between Devil
Canyon and Talkeetna,a mitigation plan should consider the possibility
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of creating artificial spawning channels along this stretch.Needed
first is a careful survey of possible sites where such channels might be
built.I have seen no such data nor any plans for obtaining it.
Concern over changes in turbidity of post-project flows below Devil
Canyon is somewhat allayed by R&M report 3.10 (Jan.1982).Apparently.
summer turbidity will he reduced by settling in the reservoirs.but
winter flows should be nearly clear.as at present.This change does
not seem to threaten salmon reproduction.On the other hand.elimina-
tion of bed load and heavy sediment now carried by the river will affect
the shape of the river below the dams as far down as Talkeetna.In-
stream flow assessments must be continued for several years to fully
understand variations in flow.Some information on bed loadinq was
obtained in 1981 but more data are needed.Below Talkeetna the effects
on the river apparently will be minimal.but assurance on this point
will grow with additional study.
Data on salmon numbers in different parts of the Susitna Basin are
still fragmentary.but a rough estimate is now available of numbers of
fish that start up the river (Susitna Station)and those that pass
Ta"1 keetna to spawn in the upper reaches below Devil Canyon.I have
summarized and averaged data given by Dana Schmidt (report Dec.22.
1981)as follows:
Approximate escapement above:%escapement above:
Species
Coho
Chinook
Sockeye
Pink (odd yr.)
Chum
Susitna Station
33.470
76.258
340.232
113.349
286.363 (est.)
Ta"'keetna
3.522
763 (5 yr.aver)
3.464
2.529
20.835
Talkeetna
10.5%
1.0%
2.2%
7.2%
Assuming that adverse effects on salmon vlill be felt largely or
entirely by the escapement above Talkeetna.the last column depicts the
portions of the total Susitna runs that might be impacted adversely.'
These figures.when improved over time.can serve to guide plans for
mitigation.
As the above table shows.most salmon in the Susitna basin spawn in
tributaries or in the lower river and its channels and sloughs below
Talkeetna.Salmon habitat in the sloughs is probably regulated by water
level in the main river.but possibly also by aquifers that flow through
the ri ver-bottom qravel s.\!Jhere do these aqui fers or;qi nate?Studi es
of water dynamics -in the sloughs are seriously needed ..-
\l,fildl ife
By comparison with the complexities of fisheries studies.the data
on wildlife are relatively straightforward and complete.\l,lithin the
a reas of impoundment.there wi 11 be substanti all osses of moose.black
bears.various fur-bearers and many small vertebrates.Caribou may be
troubled in reaching their traditional calving ground.and wolves ~"ill
---=-,-~~----~--------
be disadvantaged by any decrease in moose or caribou.Caribou and some
other kinds of wildlife would be adversely affected by a road from
\'Jatana Dam to the Denali Highway,for this upper reach of the Susitna
basin is a richly productive habitat.(This road is not being recom-
mended by Acres.)In my opinion,ongoing studies of wildlife species
and problems are generally adequate for purposes of project planning.
Miti gati on
The "Draft Analysis of Wildlife Mitigation Options ll is a w·ell
prepared document that defines possible wildlife losses and lists quite
adequately the available choices for mitigation.For many species
compensation is the only form of mitigation that is possible.In some,
however,1 ike moose and beaver,ha.bitat management procedures outside
the areas of inundation are recommended.This document can serve as a
guide to development of a specific program of mitigation.
By contrast,the "Draft Analysis of Fisheries ~1itigation Options"
seemed to me cursory and incomplete.There are a substantial number of
mitigative measures that might be considered,but these are neither
discussed nor evaluated in any meaningful way.Development of a usable
report on fisheries mitigation options is very much needed.
Respectfully submitted,
A.Starker Leopold
.....1
-
~,
February 18,1982
SUSITNA HYDROELECTRIC PROJECT
ALASKA POWER AUTHORITY
REPORT NO.5
INTRODUCTION
The Alaska Power Authority External Review Panel for the Susitna Hydro-
electric Project met with the Acres Review Panel on February 18,1982.
The Acres External Review Panel had convened independently on Febru-
ary 17.Both meetings were conducted at the Acres American offices in
Ruffalo.
In addition to Panel Members,Robert Mohn of the Alaska Power Authority
and representative of Acres American were present.
The objective of these meetings was to discuss the few remaining topics
regarding the project which required resolution.Various members of
Acres American staff presented discussions regarding geotechnical
questions,seismicity,hydraulics and design.
The Panel appreciates the courtesies extended to it by Acres American
and the planning and preparation of discussion presented in the meetings.
Design Earthquake for Devil Canyon Dam
The studies conducted by Acres I consultants on seismology (Woodward-
Clyde Consultants and Dr.Sykes)have indicated the need to design both
Watana and Devil Canyon Dams for an earthquake occurring in the Tal-
keetna Terrain very close to the damsites and having a magnitude of the
order of M =6i.
For this purpose,it is recommended that both dams be designed to
withstand motions having a peak acceleration of 0.65g,a spectral shape
similar to that presented in the Woodward-Clyde reports,and a duration
of strong shaking of about 8 seconds.These are appropriately conserva-
tive motions for critical structures such as the dams of the Susitna
Project.
For the purposes of engineering anCllysis,the motions used for ex-
citation of an analytical model of a dam may well be different from
those of the Seismic Safety Evaluation Earthquake discussed above.For
the type of analysis being used by Acres to evaluate the seismic safety
of Devil Canyon Dam,the Panel believes that it is appropriate for this
structure to base the analysis on design motions having the followin9
characteristics:
--
F'"
r
I
Peak acceleration:
Damping Ration
Spectral Shape
0.55g
10%
As recommended in Woodward-Clyde
report for 10%damping
1
.....
-
:'JIl1'!llII
The use of these motions for analysis and design purposes is in keeping
with those used for similar earthquakes for critical structures in other
highly seismic regions and will provide the required degree of assurance
of the abi1 ity of Devil Canyon Dam to withstand very strong motions
(peak acceleration =0.65g)in the remote possibility that a local
earthquake of magnitude -6i should occur.
It should be noted that the above recommendation applies only to the
proposed Devil Canyon concrete arch dam and that design motions for
other structures in the Project may be different from that recommended
above,depending on the characteristics of the structures and the
analysis procedure being used for evaluating their earthquake resis-
tance.
Hydraulic Design of Spillways and Outlets
Acres reponded to questions raised by the External Review Panel in its
review of Watana and Devil Canyon drawings which are to be included in
the final draft of the Feasibi1 ity Report.The Panel concurs in the
answers to these questions and the design revisions that have been made
with the exception that it still is of the opinion that the Tarbe1a air
slot design for the spillway chutes would be more effective than the
proposed aeration gall ery with out1 et ducts.However,thi s questi on
will need to be resolved by large-scale hydraulic model tests in the
final design of the spillways.
The Panel concurs that the revised emergency excavated spillway channel
with a long relatively small invert slope to a pilot channel with a
steep slope is superi or to the previ ous1y proposed excavated channel
with several invert drops.It is suggested that in final design the
slope of the excavated channel be reduced as much as is practical in
order to decrease velocities and erosion in this channel.
Liquefaction Potential of Soils in Relict Channel
At its last meeting in January,the Panel requested that Acres investi-
gate the possible effects of earthquake-induced 1 iquefaction in the
surface soils of the relict channel.This question has been addressed
in the report of Acres External Review Panel,dated February 18,1982.
We agree with the recommendations expressed in this report relative to
the liquefaction potential of the soil in the relict channel.
;~.(6Q-0bv,~~--w/"-
H.Bolton Seed Jacob H.Douma
Mer1 in D.Copen
2
-
-
..,..
-
,pII'ilIIIl.
-
February 18,1982
SUSITNA HYDROELECTRIC PROJECT
ACRES AMERICAN EXTERNAL REVIEW PANEL
REPORT NO.4
INTRODUCTION
The Acres American External Review Panel for the Susitna Hydroelectric
Project met with the Alaska Power Authority Review Panel on February 18,
1982.The Acres External Review Panel had convened independently on
February 17.Both meetings were conducted at the Acres American offices
in Buffalo.
In addition to Panel Members,Robert Mohn of the Alaska Power Authority
and representatives of Acres American were present.
The objective of these meetings was to discuss the few remalnlng topics
regarding the project which require resolution.Various members of Acres
American staff presented discussions regarding geotechnical questions,
seismicity.hydraulics and design.
:1
The Panel appreciates the courtesies extended to it by Acres American and
the planning and preparation of discussions presented in the meetings.
....
""'"
Buried Channel
Regarding the feasibility ofWatana Dam,it is our oplnlon that the possible
seepage losses through the buried channel are not large enough to impact
the feasibility of the project.Moreover,possible piping of alluvial
materials can be controlled,if necessary,by weighted filter blankets
placed on the slopes between the reservoir and Tsusena Creek.The cost
of providing the downstream filter should be considered in the feasibility
report.
The present reservoir elevation of 2185 is low eno~gh such that the water
is not required to be permanently supported by the freeboard dike.In
fact,the free-board dike will not be required to resist differential water
levels for the PMF (e1.2202)because the lowest point above the relict
channel is e1ev.2202.
Recently,the possibility of liquefaction of the uppermost layers of the
buried channel fillings has been raised.If these materials 1iquified,
and if large volumes of these materials could move under the gentle slopes
shown in attached section W-16 of Figure 6.34,Task 5 Report;then it would
be hypothetically possible to breach the reservoir.Recent stratigraphy
has been developed for the buried channel which is shown in attached
Figure 1.As shown in Fig.1,the lower unit K is the buried alluvium,
unit J is a preloaded till,unit J1 is an interglacial alluvium,unit I
is a preloaded till,unit H is an alluvium,unit G is a waterlain till
orlucustrine deposit,and units A,B,C,D,E and F are more recent outwash
deposits.It is highly unlikely that liquefaction could be a problem from
the top of unit I downward as shown in the cross section given in Figure 2.
The alluvium in stratum H will be saturated by the reservoir,however,and
more information is needed to conclude whether liquefaction is or is not a
problem in stratum H.Stratum H is buried beneath the water laid till unit
G,which indicates it was saturated under the water levels which produced
unit G and was probably subjected to earthquakes during that time period.
Further development of the pleistocene geology may clarify this point.The
strata above unit G are outwash materials and more information is required
on density,gradations,and blow counts in order to make definite comments
---~---_._------------
.-
.....
Page 2
on liquefaction susceptability.Because of the above,it is advjsable to
consider the possible remedial action shown in Fig.3 where in the worst
case,a compacted dike would be placed in a trench excavated down to the
top of the overconsolidated till,(Unit I).The costs of this remedial
action should be included in the feasibility report,but the decision to
employ or omit this possible remedial action must be delayed until after
more investigations are conducted in the area of the buried channel.
At its meeting held on February 18,1982 the APA review panel made recom-
mendations concerning the design earthquake motions for Devil Canyon con-
crete arch dam.We concur with these recommendations.
--
Alfred J.Hendron
.~(7J,,~
Merlin D.Copen
Ralph B.Peck
r
QUATERNARY STRATIGRAPHY OF THE
BURIED CHANNEL AREA·
SYMBOL UNIT MAXIMUM MATERIAL TYPETHICKNESS
-.~..-.,.-...:..•
A SURFICIAL:..C:_..:'.5'..:'~:'ORGANIC SILTS AND SANDS
&DEPOSITS
,,",
WITH COBBLES AND BOULDERS..J ....
B -,.,;-.--;.~-"..'.:,-~'.-I . -.0_•w·._
C OUTWASH 18'SILTY SAND WITH GRAVEL AND
COBBLES•
.._..
0 ALLUVIUM &.'15'SAND,SILT WITH OCCASIONAL
<.flUVIAL GRAVEL I'"
.DEPOSITS
-
E OUTWASH 55'SILT,SAND,GRAVEL,COBBLES,
&PARTLY SORTED.
F.
G TILl/WATERLAIN 65'CLAYEY SILTY SAND,WITH GRAVEL
TILL AND COBBLES,OFTEN PLASTIC.
H ALLUVIUM 40'SILT,SAND AND GRAVEL,SORTED.
I TILL 60'SILT,SAND,GRAVEL,COBBLES,
/POORLY SORTED.
J1 INTERGLACIAL 45'SAND,GRAVEL WITH OCCASIONAL
ALLUVIUM SILT,SORTED•
..
>J ~...,.,TILL 60'SILT,SAND,GRAVEL .COBBLES,·....:-..'.....~:.~-'.•....."...:.."pqORLY SORTED.,....
....'-.,-",......4 .......-.......~-.-
K ALLUVIUM 160'GRAVEL,COBBLES,BOULDERS,
FEW FINES.
FIGURE I
if
J j J ])11»1 }I J j v J J i
1600
?OOO
2400
~------
SoL OO~I
i 1-~·lSU5U.fl [HHK
--._.~[lH 'GBD
.,t"-:>,IJ.{",fll',;-ilfi --~"
Sl80-2
i
,.~315"
5W-3
i
OM-"
NonMhl t..U),)(IMUM 1~~vn £l 7185 OPE:RAl aNG rNORMAL MAxIMUM
•OA-19 _.OP~~~'tlG I'OOL---=o~~o-=~_-=--=---J_----__----~o--OA-20 •J
"'SI1N'R1 V"-/d1r')f1<~--=------._--~-~----~OA.le_."VEA ''''I -----~-:=-.L.-.-I""'"'~",.,,,,"'~,..'"''.-.-""'''i'',~.=~<~.=-----\'-..,,'_.......,.•"00··-.,.,,_~:.__•-------
......-----
I THIS AREA APPROXIMATELY
3000'UPS1 RE t.M OF Wb.l ANA I
OA ....C[Nl ERLINE -1 "THE FINS"TO TSUSEIM CREEK
SHORTEST F LOW PATH
g;c;.!,()I'l~:JJL
1700
['111:1-ef "l1L;urE "';1
111~L_5 eDofeT
I J 1 I 1 J -)J J i ]))J )]j J J
I
---------------------.
2300 I FREEBOARD DIKE
®
x x x
J
Jl X
:---
Jl x )[1 Jl____Jl
DR-20
TSUSENA CREEK ---r--------r-----1-----r
noD 2400 2600 2BOO 3000
Jl X X
20001800
CREST EL.2210 FT.
-------x x X Jl X II
1600
Jl X
14001200
Jl Jl X X Jl X.Jl
BEDROCK
1000
DR-19
BOO
xxxx,......,.-J.x
600400200
PMF EL 2202 ~=~T----L!-~
AESEAVO'A El ""F!oo~-_~~~--=F"--------==t=j
o
2100
1900 I------=----~~~;.~~~~~~.~---------'1-------------·-1--~-"~-----__._--·------.------------.------------.--",---,,-~---,---,-._--...;
2200
2000
E
L
E
V
A
T
Io
N
I
N
F
E
E
T
HORIZONTAL DISTANCE IN FEET
VERliCAL EXAGGERATION =2
V\fATANA RESERVOIR
FREEBOARD Dll(E
CROSS SECTION
FIGURE 2
1 j }"j }1 1 1 1 j )1 1 j
OVERCONSOLIDATED
DEPOSITS
TOP OF
GROUND
..-"j)
--r------.--!-~
-.:-
------------
It It It It X It It It ItXl<It
ALLUVIUM
l<X l<l<
ALLUVIUM
~..~:..
O\'ERcor~50LlDATED TILL
RESERVOIR LEVEL
2185 FT.
xXX---X-------
-----·OUTWASH·----_t-NORMALLY
.CONSOLIDATED.-:;f~!:Cr<..~:WATERLAIN TILL DEPOSITS..~',·:l~jL·~ls;l .-2:·";I~'..
'..·.,_iLc.-:..~l·.G:o';",:·tC·N .H :'..OunvASH/ALLUVIUM UPPER LIMIT OF
_.==---I GLACIAL<tP OVERCONSOLIDATED TILL OVERCONSOLIDATiON
0·-.....-..'
~
®
It It It
2300
2200
2000
2100
1900
1800
E
l
E
V
A
T
Io
N
I
N
f
E
E
T
600 500 400 300 200 100 o 100 200 3 n !'l 400 500 600 700
HORIZONTAL DISTANCE IN FEET
TOTAL CUT =13 MILLION CU.YD.
DAM VOLUME ~4.5 MILLION CU.YD.
BURIED CHAr~NEL
ALTERf\!ATIVE SOLUTION
fIGURE 3
,~
ALASKA POWER AUTHORITY
334 WEST 5th AVENUE -ANCHORAGE,ALASKA 99501
Mr.Charles Conway,Chairman
Alaska Power Authority
334 West Fifth Avenue,2nd Floor
Anchorage,Alaska 99501
Dear ~1r.Conway:
April 14,1982
Phone:(907)277-7641
(907)276-0001
In response to your letter of February 3 to members of the
Alaska Power Authority External Review Panel for the Susitna
Project and your request for a critical evaluation of the Acres
American Inc.Feasibli ty Report and findings and the responses of
individual Panel members to specific questions,we offer the
following attached comments on the various aspects of the study.
It has been a pleasure working with members of the Alaska
Power Authority staff and Acres American,Inc.on this important
study and we would like to express our appreciation to you and
all concerned for the help and support we have received in
preparing our reports and recommendations over the past two
years.
Sincerely,
EXTERNAL REVIEW PANEL
MEMBERS
1L~~A.Starker~
7:7~K~·~lnis M.Rohan
Attachment:as stated
~tfU-.
C!ObH:Douma
a~\guJQ~~
Andrew H.Meriitt
H.Bol ton seed·
-
ENVIRONMENTAL CONSIDERATIONS
Development of the Susitna Hydroelectric Project will impact the
environment of the Susitna basin in a number of ways.The two reser-
voirs will inundate substantial areas \vhich now support forests and
some kinds of wildlife~the construction camps,roads,and transmis-
sion lines will disturb various upland ecosystems~and the flow of the
Susi tna River below the dams will be mod if ied as salmon spawning and
rearing habitat.A number of on-going studies have shed considerable
light on existing animal populations and vegetational types.Although
some information is still far from complete,it is possible now to
anticipate some of the impacts that the project will impose on these
communi ties.In the aggregate,the total impact will be rela ti vely
small.110reover,by judicious management,it will be possible to mit-
igate some of the habitat losses by improving habitats elsewhere.The
CI iscussions which follow summarize the environmental problems as they
are now understood.
Fleservoir Areas
The two impoundments,with an aggregate area of about 71 square
miles,will obviously be converted from terrestrial to lacustrine hab~
i.tat with a loss of all the plants and wildlife that use these areas
now.Among the larger animals whose numbers will be red uced are
moose,bl ack bear,and several species of mustel id fur-bearers.A
wide variety of small birds and mammals will be evicted.Yet most of
these species are common in this part of Alaska ~there are no known
endangered species of either plants or animals.In the case of the
moose,it is proposed to manipulate vegetation along the lower
Susi tna,by burning or mechanical means,to create more winter range
and hence to increase moose populations there to compensate for losses
of moose in the impoundment areas.A somewhat reduced moose popula-
tion'in the upper Susi tna basin might mean some reduction in the
dependent wolf population.The Watana impoundment intersects a migra-
tion route used by the Nelchina caribou herd.Al though caribou swim
well,and easily cross natural water barriers,there is a possibility
that ice shelving along the shore of the Watana reservoir might inter-
fere with caribou movements.If such a problem is detected,the ice
shelf could presumably be blasted.Of greater importance,perhaps,is
the necessity to clear and remove all the timber from the impoundment
areas to preclude the formation of floating log jams that could create
a truly dangerous barrier to migrating caribou.
The upper Susitna River supports several native fish,
the grayling is the primary game species.Although the river
that are inundated will be lost to grayling production,it is
that the reservoirs themselves may support modest populations
ling and perhaps lake trout.
1
of which
habitats
possible
of gray-
----,--,---=-~----------------------
Downstream Effects
Below the Devil Canyon dam the flow of the river will be substan-
tially al tered from its natural cycle.High summer f lows will be
captured in the reservoirs to supply winter discharge.The red uced
summer flows in the river might adversely affect salmon spawning and
rearing habitat as far downstream on the confluence with the Chulitna
Ri ver,near Talkeetna.Side sloughs that are used as spawning areas
by chum and sockeye and as rearing areas by juvenile coho and chinook
vdll be cut off from flushing flows which normally occur at high
levels of discharge.Considering the total runs of salmon that spawn
in the Susitna drainage and its tributaries,the proportions that uti-
lize the reach between Talkeetna and Devil Canyon are as follows
(figures from Schmidt and Trihey):-
Total Susitna Percentage spawning
Species runs (approx.)above Talkeetna
Coho 33,000 8%
Chinook 76,000 2%-Sockeye 340,000 1%
Pink (odd
years)113,000 3%
Chum 286,000 15%
Chum and coho salmon are the two species that might be adversely
affected by construction of the dams.There are good prospects for
TIli tigation of those potential losses.Thirty-two sloughs have been
identified along this stretch of the river.Mechanical opening of in-
take channels might permit flushing flows at discharge levels planned
for normal power product ion.Occas ional higher flows might be re-
leased,if needed.Addi tionally,artificial spawning channels might
be constructed.If proper multiple outlet structures are installed in
the dams,water temperature can be regulated as well as flows.Much
of the silt in the upper river will settle in the reservoirs,result-
ing in clearer water flowing from Devil Canyon dam,which may be
highly advantageous for rearing of young salmon.All of these mitiga-
tion measures could preserve the salmon runs at nearly pre-project
levels,or potentially at even higher levels.Below Talkeetna,no
significant changes in the salmon habitat are anticipated.
Elimination of peak floods may result in stabilization of bars,
islands,and river banks in the river bottoms below Devil Canyon Dam,
with the result that riparian forest may develop in areas now in wil-
low brush.Such advance in plant succession will be unfavorable to
moose,since willow is a prime \'linter food.This trend can be
reversed by a program of logging of the bottomland forest or by judi-
cious controlled burning.
-
-~
!3ummary
Considering the environmental impacts as a whole,and the possi-
bilities for partial mitigation,it does not appear that environmental
considerations should preclude the development of the Susi tna
Project.
GEOTECHNICAL CONSIDERATIONS
General
The External Review Panel,as a group and individually,has
visited the proposed dam sites,inspected the rock formations,
reviewed the results of the exploration program,and read the
interpretations and conclusions presented by Acres in their
£~easibility Report.~~e recognize that the site exploration has been
done in various stages over the past years and note that the
Feasibility Report has included the pertinent portions of these
earlier studies.
We conclude that the amount of site geologic investigations
completed for the Feasibility Report is adequate to effectively
preclude unknown geotechnical condi tions which would have a major
adverse impact on project design and costs.
Geology and Project Layout
The geologic conditions revealed in outcrops and borings are
generally very favorable for the structures required for the project.
Where local shear zones or other areas of poorer quali ty rock have
been identified,the proposed project features have been positioned to
avoid them to the degree possible.For example,the diversion tunnel
i.nlet structure at Watana has been moved downstream to avoid the
'''Fins''feature,the major underground chambers at Watana have been
moved to the right abutment to avoid the "Fingerbuster"shear zone,
and the orientation of the open cuts and underground chambers have
been located where possible to obtain the most favorable orientation
!,irith respect to the joints and shear zones and thereby avoid major
rock stability problems.
The very good rock conditions revealed in the borings are
favorable for the major underground openings proposed and we foresee
that the excavation and support of the chambers will proceed using
well establ ished construction methods.We expect that subsequent
exploration \ttill provide the information required to establish the
most favorable final position for the chambers as well as providing
more detailed information on the most appropriate excavation and
support methods for the large diameter tunnels and high slopes.
3
.-
-
,~
~pecial Geologic Conditions
The results of the exploration program at both sites have
revealed no geolog ic structures that can not be handled by
conventional methods.Moreover,the field work has been suff ic iently
widespread to embrace the general geologic conditions so that no major
adverse feature is likely to have been overlooked.
One of the most important geologic aspects that will receive
careful attention during future field work is the buried or relict
channels on both abutments at Watana.To date the studies have
identified a deep channel on the right side that passes between
Deadman's and Tsusena Creeks that has been filled with varied glacial
deposi ts.The geometry of the channel and general nature of the
deposits have been defined by geophysical surveys and borings.More
recent studies on the left side in the Fog Lakes areas indicate that a
similar channel exists here also.
The importance of this channel and its deposits for the Watana
si te are threefold:1)magni tude of seepage,2)piping of materials
towards Tsusena Creek,and 3)seismic instability of the soils under
strong earthquake shaking.These i terns have been fully addressed in
our meet ings "vi th Alaska Power Authori ty and Acres and among other
items,mod ifica tions have been made in the level of the reservoir to
decrease the height of water against the saddle dike on the right
side.It is clear that further field studies are required (and are
planned)to assess the importance of the above mentioned three
factors.However,as has been clearly pointed-out in previous
reports,we believe that there are technically and economically viable
solutions to these potential problems.Acres and their External
Review Panel hold the same opinion.For the various possible
solutions,estimates have been developed and are reflected in the
project costs.We believe that the estimate is reasonable and should
cover possible contingencies that may develop as more information
becomes available.
SEISMIC DESIGN CONSIDERATIONS
The Susitna Project is clearly located in an area of potentially
strong seismic activity and must be designed to safely withstand the
effects of earthquakes.For this reason,a greater than normal effort
has been devoted during the feasiblity studies to determining the pos-
4
------,------------~--__-"""""1'"-----------------------
.-
.....
sible sources and magnitudes of seismic events which could affect the
project and the intensity of shaking which these events could produce
at the proposed sites for Watana Dam and Devil Canyon Dam.
The extremely comprehensive studies of the seismicity of the pro-
j!ect area are probably more extensive than those conducted for any
other hydropower project in the world.They have been conducted by a
highly competent group of earth scientists and engineers and they have
identified the major potential sources of seismic activity,the
potential magnitudes of earthquakes which oculd occur on these sources
and the levels of ground shaking ""hich could occur at the project
sites as a result of the largest earthquakes likely to occur on these
:::ources.
Design ground motions for the required studies have been selected
\>1ri th a degree of conservatism appropriate for critical structures,
t:aking into account the possibility of a great earthquake (Magnitude
8.5)occurring on the Benioff Zone underlying the dam-sites as well as
the possibility of local earthquakes (Magnitude about 6 1/4)occurring
within a few kilometers of either of the sites.
Viratana Dam
The preliminary design of the Watana Dam is a high embankment dam
with gravel shells and an impervious central core.The design is sim-
ilar to that successfully used for other very high dams (Oroville Dam
in California and Mica Creek Dam in British Columbia,for example)and
grenerally considered to be the most desirable for embankment dam con-
struction.Sources of the required types of soils have been located
and investigations have shown that ample quantities are available.
The proposed section of the dam is appropriately conservati ve
wi th a proven capabil i ty to wi thstand normal loadings and excellent
characteristics to enable it to withstand any anticipated earthquake
loading.The proposed design is in fact very similar to that of Oro-
ville Dam in California which has probably been subj ected to more de-
t:ailed analysis of seismic stability than any embankment darn in the
world.These studies have shown that the Oroville Dam would be stable
even if a Magnitude 8 1/4 earthquake should occur within a few
kilometers of the dam-si te.The controlling des ign earthquake for
Watana Dam is comparable in magni tude but is source is located about
65 kms from the Watana site so that the shaking intensity is less than
that used in the Oroville Dam investigation.Furthermore,the
proposed materials for construction of the upstream shell of Watana
have equally desirable characteristics as the Oroville Dam shell
materials.Consequently,there is no reason to doubt,and preliminary
analysis by Acres American,Inc.,confirm that,with appropriate
attention to engineering details,the proposed 'V'latana Dam section will
be able to withstand the effects of the conservatively evaluated
earthquake shaking with no detrimental effects.
5
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pevil Canyon Dam
The proposed design of Devil Canyon Dam is a concrete arch and an
evaluation of the design is presented in the following section.With
regard to earthquake-resistant design,dynamic analyses have been made
to determine the stresses developed by conservatively-selected design
earthquakes:a magni tude 8 1/2 event occurring at a distance of 90
kms and a local earthquake of magni tude 6 1/4 occurring very near the
dam-site.The computed stresses are.with the acceptable limits for
concrete arch dams.
Furthermore,the ability of such dams to safely withstand
l=xtremely strong earthquake shaking has been demonstrated by the
I=xcellent performance of the Pacoima Dam in California in the San
Fernando earthquake of 1971.This 350 ft.high dam safely withstood
the effects of a Magni tude 6 1/2 earthquake occurring di rectly below
the dam and producing some of the strongest earthquake motions ever
recorded.This full scale test of a prototype structure provides
convincing evidence that such dams can be designed to safely withstand
the effects of strong earthquake shaking.
Other structures
In final design careful attention will have to be given to the
earthquake-resistant design of other features of the project including
spillways,powerhouses,intake structures,etc.The safe design of
these structures is well wi thin the state-of-the-art of eng ineering
design for the anticipated levels of earthquake shaking and should
present no major problems with regard to unacceptable levels of damage
or public safety.
uncertainties in Design
Probably the greatest uncertainty wi th regard to seismic design
is in the required treatment of the buried channel on the right bank
of the Watana reservoir.This uncertainty stems mainly from the fact
that it has not been possible at this stage of project development to
ascertain by borings the types of soils filling the buried channel and
their engineering characteristics.
However,this is not a major problem since even if very
unfavorable characteristics are assumed for these soils (and this will
not necessari ly be the case),remed ial des ign measu res have been
explored and developed to eliminate any problems which could arise.
Provisions for the costs of these measures are included in the
cost-estimate even though the mitigation measures themselves,Ttlhich
may not be required,are not presented in the feasibility design
reports.
6
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....
.....
-
.,-
Conclusion
In summary,it may be stated that the feasibility studies for the
Sus i tna Proj ect included an extremely comprehensive investig a tion of
the seismici ty of the project area and the development of design
concepts for the major critical structures which,with appropriate
attention to details in the final design and construction,should
certainly eliminate any concerns regarding the provision of an
adequate level of public safety and the prevention of any significant
damage to the project as a result of earthquake effects •
DEVIL CANYON DAM
The Devil Canyon Damsite is ideally suited for an arch dam.The
canyon is narrow and V-shaped.The abutment rock is sound and compe-
tent.
Devil Canyon arch dam has been designed and analyzed by use of
the Arch Dam Stress Analysis System (ADSAS)computer program,which is
the computerized version of the Trial Load Method of Analysis.This
method vias developed by the U.S.Bureau of Reclamation and has been
thoroughly examined by rigorous mathematical analyses.In add i tion,
results from this method have been successfully compared with
structural models and prototypes in service.
The design selected for Devil Canyon is a thin double curvature
arch.It is curved in both horizontal and vertical planes to produce
the most efficient distribution of stresses possible under the site
and loading conditions to which it may be exposed at this site.
The static loading conditions examined are the most severe combi-
nations of gravity,reservoir and temperature loads anticipated at the
site.The resulting stresses indicate a factor of safety greater than
four,based on the anticipated compressive strength of concrete in the
structure.The maximum tensile stresses occur on the downstream face
of the arch,where,if cracking were to occur,no damage would
resul t.The magni tudes of tensile stresses indicated will not occur
since a redistribution of load in the dam will result as such stresses
<Jevelop.
The dynamic loads applied to the dam are considered to be very
conservati ve.Even so the resulting stresses will not cause serious
damage to the structure.The analytical method used for stress stud-
ies is based on elastic theory.If the stresses ind icated should
occur,contraction joints in the upper part of the dam may open momen-
tarily but would not result in major release of water or permanent
damage to the structure.
7
_~~~IiII"_'''~_--''--_
,-
--
-
The preliminary design for Devil Canyon Dam does,in every re-
spect,respond to the seismic environment of the site.
Wi th proper construction control,the dam will provide adequate
safety under all loading conditions.It is extremely important that
the very best construction techniques be employed in this dam.Proper
concrete mix designs,consistent consolidation of the concrete and
careful treatment of the rock contact and construction joints are of
the utmost importance.The resulting concrete must be a homogeneous
and isotropic product.
There are always risks of inadequate or inconsistent construction
practices which would present problems in the behavior of a dam.For-
t.unately an arch dam has the capability of distributing load from
weak areas to stronger,more capable concrete.This is not meant to
excuse any but the best concrete control possible,because any weak-
nesses are not acceptable in this important structure.
Additional foundation investigations and insitu measurements will
be required before a final design for Devil Canyon Dam is completed.
Deformation moduli,joint orientation and continuity,and shearing re-
sistance along joints will be required.Because of the preliminary
nature of the present studies,such investigations are not considered
necessary at this time.Instead,conservative assumptions have been
made to assure a safe and satisfactory structure.
The proposed foundation treatment,consisting of consolidation
and curtain grouting and adequate drainage,is satisfactory.
The eng ineering consul tant has used adequate conservatism
ithroughout the design for Devil Canyon Dam.Very Ii ttle change from
the preliminary design is anticipated for a safe and efficient final
design for Devil Canyon Dam.
HYDROLOGY AND HYDRAULIC DESIGN CONSIDERATIONS
Flood Potential
The engineering consultant's assessment of the flood potential in
the project area has properly identified the potential magnitudes and
frequencies of flood flows.
The assessment utilized all available precipitation,snow survey
and stream gaging data for stations within and adjacent to the Susitna
River Basin.The probable maximum flood is based on the most critical
combination of precipitation,snow melt,infiltration losses and flow
8
i~
".,.
concen tra tions that is reasonably poss ible.The hydrolog ic analyses
are in accordance with accepted engineering practice which has been
developed in the United States and is be ing used in many parts of the
\\rorld.
Spillway Capacity and Dependability
The proposed design adequately responds to the hydrolog ic envi-
ronment in terms of spillway capacity and dependability.
Both Watana and Devil Canyon dams will have low-level valve-
controlled outlets to pass the once in 50-year flood,a gate control-
led chute spillway in combination with the valve outlets \vould pass
the once in 10,OOO-year flood and a fuse plug emergency spillway
in combination wi th the valve outlets and chute spillway would pass
t~he probable maximum flood without overtopping the dams.Similar
valve outlets and emergency spillways have been constructed and
operated elsewhere with successful service.There is no reason to
believe that they would not be successful at the Susitna project.
Public Flood Safety
The proposed project adequately protects public safety in terms
of the flood danger and there are no increased flood risks inherent in
building the project.
The reservoirs will be'drawn down in winters providing signifi-
cant amounts of reservoir capacity for storage of summer floods.
Virtually all normal ri ver flows would pass through the powerhouses
with very little spillway operation.Peak discharges for major floods
would be reduced substantially.Cons~quently,project operation would
Emhance the publ ic safety by reduc ing the magni tude and danger of
floods in the lower Susitna River.
Spillway capacities and heights of dams are designed with conser-
vative safety factors.The dams and water conveyance structures are
designed and would be constructed with high safety factors in accord-
ance with best engineering practice.For these reasons,there would
be no increased flood risk inherent in building the project.
Project Damage or Shutdown
There is no reason to expect that the project would experience
damage and/or require shutdown as a result of floods.
Major floods may cause some cavitation erosion in spillway
chutes,river bank and bed erosion downstream of flip buckets and
valve outlets,and erosion in the unl ined emergency spillway channel.
9
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,~
Because of the infrequent occurrence and relatively short duration of
major floods,none of these types of damage would become so extensive
during any single flood to require project shutdown.
One or more of the valve controlled low-level outlets may sustain
damage during a major flood requiring temporary shutdown for repairs.
T'his shutdown vlOuld not significantly affect flood regulation since
each outlet discharges a small percentage of the total flood flow.
As the powerhouses will be underground,floods would not cause
them to be damaged or shutdown.
Design and Operation Assumptions
The engineering consultant has not made any major assumptions re-
garding design',operational mode,etc.of water conveyance structures
that lack a satisfactory level of conservatism.
The low-level outlets,main spillways,and fuse plug emergency
spillways have all been designed in accordance with current engineer-
ing practice which is based on conservative assumptions.Fixed cone
valves are superior to any other type of valve for high-head opera-
tion.Air slots will be provided in spillway chutes to prevent
cavitation erosion by high velocity flow.Pre-excavated plunge pools
and/or bank protection will be provided downstream of flip buckets and
fixed cone valves to prevent exces s i ve streambed and bank eros ion 0
The fuse plugs are designed conservatively to withstand reservoir
pressures until they are overtopped and then wash out rapidly to
activate emergency spillway operation.The assumption that excessive
erosion would not occur in the unlined emergency spillway channel is
conservative in view of the mild channel slope and favorable rock
quality.
The proposed operation of the water conveyance structures is be-
lieved to be the most reasonable and practical operational mode which
provides a satisfactory level of conservatism with respect to down-
stream effects and project safety.
Reservoir Sedimentation
The effects of reservoir sedimentation have been properly assess-
ed in design of the project.
Based on conservative values of the sediment inflow and reservoir
t.rap efficiency,less than 5 percent of ~vatana reservoir would be
filled in 100 years,and deposits in Devil Canyon would be less than
25 percent of that deposited in Watana reservoir.A large percentage
of the sediment would be deposited in the dead storage portion of the
10
____,,---4,.,..,..,------_
.....
reservoirs.Reservoir sedimentation is not a controlling factor in
project design as larger reservoirs or higher dams are not required
and power production due to reservoir sedimentation would not be
affected for well over 500 years.
Potential Downstream Effects
The proposed design and operation of the water conveyance
structures adequately addresses potential downstream effects on river
morphology,fisheries and wildlife.
Multi-level intakes will be provided for the power intakes and/or
low-level outlets,as necessary,to permit release of reservoir water
in the temperature range suitable for the downstream fishery.The
valved outlets will discharge into relatively shallow basins,thereby
preventing nitrogen supersaturation conditions harmful to fish.
Spillway flip buckets and plunge pools will be designed to minimize
nitrogen supersaturation.Their infrequent operation of once in 50
years would also greatly reduce any potential for serious effects on
fish by nitrogen supersaturation.Planned increased reservoir
releases during critical spawning periods together with remedial river
channel work in spawning areas would minimize detrimental effects
caused by lower river water levels due to project operation.While
turbidity levels of reservoir releases would be sharply reduced in the
summer,winter turbid i ty levels may be above natural levels due to
suspension of fine sediments in the reservoirs~but this is not
believed to be significant.Project operation will cause the
following addtional effects in the Susitna River downstream of Devil
Canyon Dam:
1)
2)
3)
Eliminate and/or reduce thickness of ice cover for 20 to 30 miles
downstream of Devil Canyon Dam in the winter due to release of
reservoir flows above freezing temperatures which would prevent
river crossings over ice by some wildlife and humans.
Sediment loads would be reduced in the Susitna River upstream of
the confluence wi th Talkeetna causing some degradation of river
channels.
Sed iment loads would be essentially unchanged below the
confluence because of the extremely large volume of sediment in
the flood plain and contributed by tributary streams below the
Talkeetna confluence.
4)Summer water stages in the lower Susitna River will be reduced by
1.5 to 3.5 feet which would reduce flooding in some areas and
should not cause major impacts on navigation and other river
operations.
11
The lower river will become more stabilized,
decrease in the number of small subchannels and
vegetative cover.
resul ting in
an increase
a
in
6)The absence of annual floods may resul t in some loss of new lands
for moose browse.
In summary,the potential downstream effects do not appear to be
of such significance as to seriously jeopardize project construction.
~1itigation Measures in Water Conveyance Structures
Based on successful experience at other projects,
measures that will be incorporated in the design of
conveyance structures should be reliable and effective.
mitigation
the ~'later
-
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Multi-level intakes would have ports at several reservoir levels
and a gate control system which would permit reservoir water to be
released at the best possible temperatures suitable to the downstream
fishery.The fixed cone valve sizes and operating heads for the
Susitna project are well within their acceptable limits.Additional
reliability of operation is provided by the use of 5 and 6 valved
outlets at Devil Canyon and Watana,respectively.This enables
continued operation at a high level of reservoir release in the event
that one or two outlets would need to be closed.Operation of the
valved outlets,as proposed,will reduce operation of the main spill-
~l'1ay to once in 50 years,thereby reliably and effectively minimiz ing
nitrogen supersaturation effects on the downstream river fishery.
Conclusions
In summary,it may be stated that the feasibility studies for the
Susitna Project includes a thorough development of hydrologic aspects
of the Susitna River and the development of design concepts for the
major water conveyance structures which,with appropriate attention to
details in the final hydraulic design,would assure an adequate level
of public safety against flooding and the prevention of excessive
detrimental downstream effects on river morphology,fisheries and
'wildlife.
MARKETS,ECONOMICS AND FINANCE FOR THE PROJECT
This section responds to the basic issues of the macroeconomic
forces impacting the economic viability of the project,the future de-
mand for power,economic measures and risks for the project,financial
12
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opportunities and problems,marketability of power and suggestions for
an overall strategy.
Macroeconomics
Two factors,future world oil prices and market rate of interest
strongly impact (if not dominate)the economic and financial viability
of the project.Both of these factors are in a large measure outside
the control of the Alaska Power Authority.
Oil prices strongly affect the State's revenues,which in turn
influence the State I s economy,the rate of economic development in
Alaska and correspondingly the future demand for power.These prices,
through competitive market forces,establish the long run competitive
price of natural gas and influence the price of coal and thus strongly
influence the costs of thermal alternatives to the Susitna Project.
'I~hese same prices affect State revenues and available funding from the
State for the project,and the marketability of power.
The Susitna project is economically attractive in an environment
of rising oil prices and low interest rates.Interest rates for State
Government bonds are the highest they have been in fifty years.Wi th
a growing surplus of crude on \mrld oil markets,the spot prices of
crude have declined and future price trends are uncertain.
More than 90 %of
are interest charges.
termines the cost
economics.
the direct costs of operating a hydro facility
The market rates of interest,thus strongly de-
of the Susitna Project and its relative
-
Demand For Power
We have reviewed the range of demand forecasts developed by ISER
and Battelle and employed by Acres in their report and it is our
opinion that these forecasts appear reasonable.Actual growth rates
\vill probably lie between the expected and low cases.This is true
because essentially all of the power will serve the residential and
commercial market,which tracks population and employment trends.
Economics of the Susitna Project
The present value of the cost of the Susi tna Project versus
another source of power is related to the time horizon of the
evaluation and the discount rate.The time horizon is important
because the economics may be different depending on the period of
evaluation.
13
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Work done by Acres and Battelle,and supported by our independent
evaluation show that over a 30 year period through the year 2010,the
Susitna project would probably yield no net benefits.With current
interest rates and oil prices,over a thirty year period,power from
the Susitna could very likely be more costly than a thermal
alternative.
However,hydro projects usually have long useful lives of many
decades,and over a 60 year period,the Sus i tna project appears to be
economically attractive.
Wi th this framework,there is'a value trade-off for Alaskans to
choose between
*
*
Receiving the current benefits from funds that would be
invested in the Susitna Project
or
Investing and receiving the potential long term benefits of
hydro power in the next century.
Sensitivity and Risk Analysis
The net economic
alternatives are highly
rates,fuel escalation
financing strategies.
benefits for the Susitna project versus
sensitive to load forecasts,real discount
costs,capital costs of the project,and
For the Acres I base case analys is,wh ich has escalating energy
prices of 9-10%per year based on inflation of 7%per year and an
impl ied interest rate of 10%,the net gain over a 60 year period is
about $1.3 billion (1982).The investment in the Susitna Project
corresponding to this gain is $5.1 billion (1982).If the load
forecast follows a low growth scenario,the net gain is reduced to
nearly zero,or if the discount rate is reduced to 12%(5%real)the
project would yield a loss of $500 million or more.
If the fuel costs escalated at an inflation rate of 7%per annum,
the impact would also be a loss of $1.1 billion dollars.Conversely,
if the escalation rate for fuel is 10%,the impact would be a net sum
of about $1.5 billion.If the capital costs of the project were 20%
more than estimated,the cost of the Susitna Project and a thermal
alternative would be essentially the same.
There is a wide range of possibilities for'forecasts of these
'7ariables and correspond ing values for the net benef its or losses.
1~hrough a probabilistic assessment of each of these variables,Acres
estimated that there is about 25 -30%chance for a net loss and a 70
75 %chance for a net gain.These assessments were made in an
14
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environment of increasing oil prices and medium increases in load,and
did not directly account for the financing and marketing risks in
these economic analysis.If we include these factors in todays
environment,the risks increase al though the weight of the economics
still slightly favors the Susitna Project.
The major economic risks for the project are:
(1)Inabi1ity to obtain favorable bond rates and corresponding high
financing charges for the project.
(2)Lower than expected energy price increases could make the project
economically nonviable.
(3)Capital cost estimates may be too low,placing severe financial
strain on the project.
(4)possible opportunity losses,that is,foregoing the benef i ts of
other investments in Alaska,for example,industrial development
in enterprises which might generate net revenues or a stable long
term employment base.The Susitna project would generate jobs
during construction.However,in the long term during operation,
the number of jobs added to Alaska1s economy is minimal.
(5)Difficulty in entering into long term contracts for the power.
(6)A possible combination of the above.
Management of Economic Risks
Many of these risks can be managed,thereby substantially
i.ncreas ing the possibility of favorable economics for the project.
'I~he essence of this management is (1)timing and (2)add it ional
low-cost studies.
A strategy of waiting patiently for favorable bond interest rates
and an increase of oil prices would substantially reduce the risks.
Taking a long term view,over say ten years,there is a strong
possibility that interest rates will decline giving the Power
Authori ty a window to obtain inexpensive financing.Correspondingly
in the same time frame,it is likely that oil prices may start to rise
again.In order to finance and start construction when these
favorable events occur requires positioning now.This includes
obtaining in advance all permits and licenses,and completing the
engineering design and environmental studies.
To further reduce the risks,
l'wthori ty develop a business plan
identi fy viable power al terna ti ves
or the demand forecast changes.
it is recommended that the Power
which would,among other things,
if the Susi tna project is delayed
15
_____~~~IR_.----~f"W_.,._-_-_------_
_.
Financing
In the current inflationary environment,the Susitna Project
would probably need state goverment participation of about 50%of the
project's value $2,500,000,000 in 1982 dollars and more than
$3,500,000,000 in actual costs.Because of the high level of risks,
the debt portion of the project would probably require implici t or
explici t state guarantees,or possible general oblig"a tion bonding.
The State of Alaska effectively takes all the risk on the entire cost
of the project including potential bonding of $2,800,000,000 in 1982
dollars and a correspondingly greater numbers of actual dollars.
A combination of escalating construction costs,high interest
rates,and declining state revenues could put a revenue cash flow
squeeze on the project.Positioning,patience and timing are critical
to minimizing this risk.
These are some major opportunities in the financing area
including the arbitraging of funds during the construction period or
obtaining low cost debt financing.For example,if the project could
be financed today at the lower rates that prevailed in 1977 and 1978
i(7 to 8%),the present value of the costs could be reduced by about
$1,500,000,000 (1982 dollars).A recurrence of low rates would
markedly affect the financing of the project.
The tactics and strategy for financing needs further study and
should be developed in the business plan.
!i1arketabil i ty
The power from the Susitna Project probably could not be sold
unless it were less costly than alternatives.Anchorage,Fairbanks,
and other regions within the Railbelt Area have different power
sources and,correspondingly,different cost bases for pow"er.This
means that if uniform electric rates were used for Susitna power,the
cost of power may be pegged to the least costly alternative.This
would further exacerbate the financing and contracting problems.
A solution lies in organizational changes and a possible state
referendum to gain support from the interested parties.This problem
of marketing needs further study in the suggested business plan.
16------------------
"~
PEPORT TO
BOARD OF DIRECTORS~ALASKA.POWER AUTHORITY
From
EXTERNAL REVIEW PANEL~SUSITNA HYDROELECTRIC PROJECT
After reviewing the comprehensive Feasibility Report prepared by
Acres American Inc.~the External Review Panel offers to the Alaska
Power Authority the following unanimous comments on the proposed Susitna
Hydroelectric Project:
1.It is recognized that the project will have environmental
impacts on wildlife~fisheries,and botanical resources.
However,the extent and severity of these impacts appear to be
relatively small and furthermore many of these environmental
losses can be mitigated in full or in part.
2.The high dams proposed for Watana and Devil Canyon can be
designed to safely withstand the maximum anticipated earth-
quake forces.
3.The proposed design adequately responds to the hydrologic
environment in terms of spillway capacity and dependability.
-4.If the project is financed at an opportune time when bond
interest rates and oil revenues are favorable~the potential
long term benefits of the Susitna project will be
considerable.
-
5.Accordingly we consider that the overall impact of the project
on the State of Alaska could be attractive.
6.To this end we endorse the plan to apply in September 1982 for
a permit from the Federal Energy Re~lUl atory Commi ssi on.
7.Moreover~we endorse the proposal to proceed with site inves-
tigations and design of the project~with concurrent work on
some of the critical environmental studies~particularly those
concerning downstream effects of the dams on the stream and
its fish 1 ife.
8.The arrival of any opportune time to proceed with construction
will depend on critical issues of finance and marketing of
power which cannot now be accurately forecast.Our
recommendation is that tender documents with all supporting
geotechnical investigations and design studies be developed.
We estimate that a total period of three to four years will be
required for this phase of work.The project will then be
ready to be implemented whenever the financial climate for
contracting becomes favorable.The advantages of proceeding
in this manner are:
---,.,.....,---,.-.------------------------
9.
(1)The economic benefits of being ready for financing;
(2)the momentum of the ongoing study and an informed
staff;and
(3)the ability to avoid a crash design program.
The disadvantage is the small risk of loss of the design costs
in the event that,for some reason,the project is never
bui It.
We recommend that the Alaska Power Authority develop a de-
tailed business plan which incorporates a financing and
marketing plan into an overall business strategy.The plan
would describe the critical events that need to be accom-
plished,the interrelationship of these events,the approach
to accomplishing these goals,the management and control
practice that are appropriate,the most economic financing
strategy,and power alternatives if the Susitna project is
delayed or the demand forecast changes.
10.This Panel is of the opinion that the economic climate will
eventually indicate that it is advisable to proceed with the
construction of the Susitna project and at that time it will
be in the best interests of the State 0f Alaska to develop
this important natural resource.