HomeMy WebLinkAboutPower Project Fund Loan Program 04-2018-AALASKA ENERGY AUTHORITY
WWW.AKENERGYAUTHORITY.ORG
REDUCING THE COST
OF ENERGY IN ALASKA
FOR MORE INFO
CONTACT:
Cady Lister
CHIEF ECONOMIST
CLISTER@AIDEA.ORG
907.771.3039
QUICK FACTS
POWER PROJECT FUND LOAN (PPF)
Nearly $12.6
million in
undisbursed
commitments
Loans in fixed
line of credit
period include
2 hydro and 2
diesel
powerhouse
projects
~11 million
uncommitted
cash balance
CURRENT STATUS
Tanacross: Loan Committee approved a $117,000 loan to complete financing and work on
a biomass project to provide heat to a multi-use facility and community water treatment
plant and washeteria in the community. The loan has a 10 year term and 3.9 percent
interest. Other funding for this project came from the Renewable Energy Fund.
King Cove: AEA disbursed $1,422,803 to King Cove to pay for construction costs associated
with the Waterfall Creek hydro project. The loan was approved for up to $1.975 million
with a 40-year term at 4.34 percent interest. The PPF loan is part of a financing package
that included Renewable Energy Fund grant money, Alaska Municipal Bond Bank funds and
other local contribution.
Haida Energy: This $20 million loan is in the fixed line of credit period as the Hiilangaay
hydro project on Prince of Wales Island is in construction phase with a maturity date of
March 2019. $9.9 million in funds have been disbursed to date. Construction continues
despite permitting issues related to the landing site(s) to access the project. Project
developers are working with DNR and DEC to identify a long term solution; in the interim
they are using alternate routes. AEA is currently reviewing phase 4 design documents to
evaluate a change from use of steel pipe to fiberglass-reinforced polymer (FRP) pipe for the
penstock.
Venetie: In February 2017, Venetie was approved for a loan for $42,000 at an interest rate
of 3.53 percent with a maturity date in summer 2024. The loan is being used to complete a
financing package to replace on engine-generator set and remanufacture a second. The
Venetie project came in under budget as a result of good local project management and
use of local labor. The community requested an extension of the term of the loan and an
amendment to use the remaining funds to perform distribution system improvements that
had been identified in an assessment provided by Tanana Chiefs Conference. The Loan
Committee approved the changes and work is underway.
Newtok: The Loan Committee approved an extension of the maturity date for the loan
from December 31, 2016 to June 30, 2017, increased the loan amount by $2,120 (from
$232,000 to $234,120), and modified the scope of work for the Newtok powerhouse loan.
These changes were necessitated by new information received by Newtok vendors once
they were on site and able to perform a more detailed system assessment. AEA assisted the
community in securing the insurance necessary to receive loan funds.
Akhiok: All work on the $37,000 Ampy Meter project in Akhiok was complete in November.
The first of 20 quarterly payments was made January 1, 2017.
Pelican: AEA closed a $61,000 loan to provide a 20 percent match to a federal grant to
stabilize the lower penstock of the hydroelectric facility located in Pelican. The City of
Pelican had an abrupt change in local government administration which has delayed use of
PPF loan funds.
Kwigilingok: All work on this $400,000 powerhouse project was complete December 30,
2016. The fixed line of credit converted to a term note with 3 percent interest on April 1,
2017. Because the project took much longer to complete than anticipated the loan
committee approved, at the request of the community, an extension of the maturity date
on the term note to allow for the originally anticipated repayment period of 20 quarters.
Koliganek: AEA staff has is processing a loan application from Koliganek for $200,000 to
complete improvements to their powerhouse and heat recovery systems. Other funds in
the project include a USDA High Cost Energy grant funds, and a small amount of RPSU funds
from AEA, and community match.
APRIL 2018
ALASKA ENERGY AUTHORITY
WWW.AKENERGYAUTHORITY.ORG
REDUCING THE COST
OF ENERGY IN ALASKA
FOR MORE INFO
CONTACT:
POWER PROJECT FUND LOAN (PPF)
Kipnuk: AEA staff is working with Kipnuk to evaluate their financing/funding options to
stabilize and improve their powerhouse and heat recovery system. This effort is being done
in coordination with the RPSU program which is installing a new powerhouse module in the
community this fall.
Chefornak: AEA staff is working with Chefornak to get a complete application packet for
powerhouse upgrades.
Port Alsworth: AEA staff has met with Port Alsworth utility personnel and anticipates a loan
application within the month to pay for new powerhouse equipment.
PROGRAM OVERVIEW
The Power Project Fund (PPF) loan program provides loans to local utilities, local
governments or independent power producers for the development, expansion or upgrade
of electric power facilities, including distribution, transmission, efficiency and conservation,
bulk fuel storage and waste energy.
The loan term is related to the productive life of the project, but cannot exceed 50 years.
Interest rates vary between tax-exempt rates at the high end and zero on the low end. The
tax-exempt rate is equal to the average weekly yield of municipal bonds for the 12 months
preceding the date of the loan application. As of April 2, 2018 this rate is 3.88 percent. The
interest rate can be adjusted downward in certain circumstances to improve financial
feasibility. Loan requests of more than $5 million require legislative approval.
LOAN FUND STATUS
As of March 31, 2018, the outstanding balance of AEA’s Power Project loans was
approximately $15.4 million.
APRIL 2018
Cady Lister
CHIEF ECONOMIST
CLISTER@AIDEA.ORG
907.771.3039
As of March 31,2018:
Cash balance $24,722,833
Outstanding undisbursed commitments $12,592,587
Operating budget commitment (FY18)$ 931,935
Uncommitted Cash Balance $11,198,311