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Home My WebLink AboutAEA Board Meeting Jan 26 2004Alaska Industrial Development and Export Authority Al Alaska Energy Authority AGENDA ALASKA ENERGY AUTHORITY Board of Directors =a.2January26,2004 Anchorage,Alaska 1.CALL TO ORDER 2.BOARD OF DIRECTORS ROLL CALL 3.PUBLIC ROLL CALL 4.PUBLIC COMMENTS 5.PRIOR MINUTES -November 17,2003 6.OLD BUSINESS 7.NEW BUSINESS A.Alaska Intertie 8.DIRECTOR COMMENTS A.Director's Status Report of AEA Programs and Projects B.Next Meeting Date -Follows AIDEA Board meeting Dates 9.BOARD COMMENTS 10.ADJOURNMENT H:\ALL\bfuglestad\BOARD\Agenda AEA.doc 813 West Northern Lights Boulevard *Anchorage,Alaska 99503 907 /269-3000 *FAX 907 /269-3044 »Toll Free (ALASKA ONLY)888 /300-8534 *www.aidea.org State of Alaska Public Notice Page |of 1 Home Go Back Online Public Notice AIDEA and AEA BoardotDirestorsStateofAlaskaCrilineMeeting Submitted by:Brenda Fuglestad/IDEA/DCED Date Submitted:01/16/2004 03:00 PM Date Modified: Ak Admin Journal:[not printed] Attachments:No files attached AIDEA and AEA Board of Directors Meeting Category:Agency Meetings Department:Community &Economic Development Publish Date:01/16/2004 Location:Anchorage Coastal!District:N/A Body of Notice: Please note that the Board of Directors of the Alaska Industrial Development and Export Authority and the Alaska Energy Authority will hold a board meeting beginning at 10:00 a.m.on Monday,January 26,2004.The board will convene as the Alaska Industrial Development and Export Authority and continue in session until recess or adjournment.Immediately upon recessor adjournment the board will convene as the Alaska Energy Authority andcontinueinsessionuntilrecessoradjournment.An agenda for the meeting is available by contacting the Alaska Industrial Development and Export Authority at (907)269-3008 or by visiting our website at www.aidea.org. This meeting will be conducted by electronic media pursuant to AS 44.88.050(a)and AS 44.62.310 at the following locations: Alaska Industrial Development and Export Authority Boardroom 813 W.Northern Lights Blvd.,Anchorage,Alaska. The public is invited to attend.The State of Alaska (AIDEA/AEA)complies with Title Il of the Americans with Disabilities Act of 1990.Disabled persons requiring special modifications to participate should contact (907)269- 3008 to make arrangements. Revision History: 01/16/2004 03:00:23 PM by Brenda Fuglestad/IDEA/DCED/State/Alaska/US $$WebClient [Anon] Home Page Notices by:Department|Category|Publish Date http://notes3.state.ak.us/pn/pubnotic.nsf/cc52605f7c 156e7a8925672a0060a9 1 b/c9a1d61b5...1/22/2004 Alaska Industrial Development and Export Authority Alaska Energy Authority ALASKA ENERGY AUTHORITY BOARD OF DIRECTORS January 26,2004,@ 11:47 a.m. Anchorage,Juneau,and Petersburg,Alaska and Chicago,Illinois Teleconference 1.CALL TO ORDER Chairman Barry called the meeting of the Alaska Energy Authority to order on January 26,2004,at 11:47 a.m.A quorum was established. 2.BOARD OF DIRECTORS ROLL CALL Directors present in Anchorage:Mr.Mike Barry (Chairman/Public Member),Commissioner Mike Barton (Department of Transportation and Public Facilities),and Deputy Commissioner Bill Noll (Designee for Department of Community and Economic Development). Directors present in Juneau:Deputy Commissioner Tom Boutin (Designee for Department of Revenue). Directors present in Petersburg:Mr.John Winther (Public Member). 3.PUBLIC ROLL CALL Staff present in Anchorage:Ronald W.Miller (Executive Director),James A.McMillan (Deputy Director-Credit),Valorie Walker (Deputy Director-Finance),Brenda J.Fuglestad (Administrative Manager),Reuben Loewen (Development Specialist),Karl Reiche (Projects Development Manager),Sara Fisher-Goad (Financial Analyst),Art Copoulos (Project Manager),and Bernie Smith (Project Manager). Others attending in Anchorage:Brian Bjorkquist (Department of Law),Richard Richtmyer (Anchorage Daily News),Mike Pauley,Wayne Carmony,Don Zoerb,Larry DeVilbiss,Tuckerman Babcock and Lee Jordan (Matanuska Electric Association),and John Cooley (Chugach Electric). 4.PUBLIC COMMENTS There were no public comments. 5.PRIOR MINUTES The November 17,2003 Board minutes were approved as presented. 6.OLD BUSINESS There was no old business. 813 West Northern Lights Boulevard *Anchorage,Alaska 99503ANTPAFNANAANWPANKATIENEANAAa2ODCAACISANRANOTPANNArTa BW 2 dee eee AEA Board Meeting January 26,2004 Meeting Minutes Page 2 7.NEW BUSINESS 7A.Alaska Intertie Mr.Copoulos said that currently the northern half of the intertie is maintained by Golden Valley Electric Association and the southern half is maintained by Matanuska Electric Association (MEA).MEA has indicated that they no longer want to maintain the southern portion of the intertie because of concerns they have with snow-loading.AEA is in the process of assigning a contract to Chugach Electric Association for the maintenance of the southern portion of the intertie.The process is on-going and is expected to be finalized in a few weeks. He said the other issue is with regard to the 19-mile by-pass.Currently,the intertie is from Healy to Willow and then from Willow to the Tealand Substation,with the exception of a five mile portion,which is owned by MEA.There is currently a transmission services agreement (TSA)between AEA and MEA that expires in July of 2004.The status of the agreement is being reviewed and is the subject of a Regulatory Commission of Alaska (RCA)case. Mr.Bjorkquist said there have been some developments in the last week with respect to the RCA case.Last May MEA gave notice that they would not extend the transmission services agreement beyond June 30,2004.That became the subject of an RCA pleading where the utilities that used the Alaska Intertie brought a petition to the RCA seeking joint use and interconnection of that 19-mile transmission line to extend beyond June 30,2004.After discussions between MEA and the Utilities,with AEA participating,MEA agreed to extend the use of those 19 miles under the same terms and conditions as are currently in existence under the TSA,however the new arrangement would replace AEA with the Utilities.This extension would take us through December 31,2004.The purpose of the extension is to give time for all of the parties to get together and discuss issues and concerns with respect to those 19 miles and the Alaska Intertie.If the discussions fail,then the RCA still has jurisdiction over this and would take up the issues before the extended period expires on December 31,2004.At this point,the use of the 19-miles is assured through December 31,2004. Mr.Bjorkquist stated that after June 30,2004,AEA will no longer be a direct party regarding the MEA 19-mile transmission line. Mr.Copoulos said that two years ago the Legislature appropriated approximately $19 million to build a by-pass around the 19-mile section of the intertie.He said that currently,Anchorage Municipal Light &Power and Chugach Electric Association have expressed an interest in taking a lead role in managing the project.It appears that a parallel route to the existing line is the most desirable option for the project.He said the route would include some of the MEA right-of- way,how much of the right-of-way is unresolved at this time. Mr.Bjorkquist said that it is his understanding that portions of the route would overlap with the MEA right-of-way and the issue is to build it sufficiently far away so that there is not a conflict of use with the existing transmission line.There would be a new right-of-way,but it would overlap with the existing MEA right-of-way. Mr.Miller said that some of the utilities thought that there could be some economies of scale brought to the project if entities such as ML&P played a lead role in the construction of the 19- mile by-pass. In response to Board questions,Mr.Copoulos said that the direction is to have ML&P be the project manager.He said that staff is currently envisioning a project management agreement AEA Board Meeting January 26,2004 Meeting Minutes Page 3 between AEA and ML&P.The intertie agreement assigns the IOC certain responsibilities associated with an upgrade of the line,so we have to take that into account in the management agreement.There are still quite a few details that need to be worked out. Chairman Barry urged staff to be extremely careful that the functions to be performed are delineated very clearly in writing before anybody starts spending money.And,to the best that we can,directly involve those that are going to have to live with the operation,namely the Utilities,in the decision making. e Matanuska Electric Association Proposal to Purchase the Alaska Intertie Mr.Wayne Carmony asked that they be allowed to present their proposal to the Board in executive session. Mr.Bjorkquist stated that the discussion of MEA's confidential proposal for the purchase of the Alaska Intertie is grounds for the Board to meet in executive session.The basis is that AEA is dealing with matters associated with the negotiation of the sale of an asset,the immediate knowledge of which could have an adverse impact on the finances of the Alaska Energy Authority.With respect to that,it is important to note on the public record that all the Board is dealing with is the proposal made by Matanuska Electric Association.The Board is not ina position to accept and close a deal at this point.A public process would need to take place before any type of arrangement could be finalized;and,in this circumstance it would probably include a legislative process with authorization for the Alaska Energy Authority to dispose of the asset.These are preliminary negotiations which would then become a public process for the disposal of an asset. As such,Mr.Bjorkquist stated that there are negotiations,strategy,and financial matters to discuss related to Matanuska Electric Associations'proposal to purchase the Alaska Intertie.Under the open meetings act a body,such as the AEA Board,can go into executive session for matters the immediate knowledge of which would clearly have an adverse affect on the finances of AEA.The appropriate procedure for doing that is to have a Board member make a motion to go into executive session for that purpose and to vote on that motion. MOTION:Commissioner Barton moved to go into executive session to discuss negotiation,strategy,and financial matters related to Matanuska Electric Associations' proposal to purchase the Alaska Intertie.Seconded by Deputy Commissioner Noll. There being no discussion,the question was called.A roll call vote was taken and the motion passed with Messrs.Barry,Boutin,Winther,Barton and Noll voting yea. EXECUTIVE SESSION --12:00 p.m. The Board reconvened its regular meeting at 1:17 p.m. Roll call was taken and a quorum was established.Chairman Barry advised that the Board had not taken any formal action on the matters discussed while in Executive Session. Chairman Barry requested that staff prepare a recommendation on the MEA proposal and explore with other railbelt utilities whether they have any interest in making an offer to AEA. Also,please inform any interested parties that it would be AEA's intention to work with the Administration and the Legislature to the extent that is appropriate. AEA Board Meeting Meeting Minutes 8A.DIRECTORS COMMENTS There were no director's comments. 8B.Next Board Meeting Date The Board would be polled as to the next meeting date. 9.BOARD COMMENTS There were no Board comments. 10.ADJOURNMENT Chairman Barry adjourned the meeting at 1:20 p.m.Dh MpiiMiller,Secretary January 26,2004 Page 4 Alaska Industrial Development and Export Authority ALASKA ENERGY AUTHORITY BOARD OF DIRECTORS November 17,2003 -10:34 a.m. Anchorage and Juneau,Alaska Teleconference 1.CALL TO ORDER Chairman Barry called the meeting of the Alaska Energy Authority to order on November 17,2003, at 10:34 a.m.A quorum was established. 2.BOARD OF DIRECTORS ROLL CALL Directors present in Anchorage:Mr.Mike Barry (Chairman/Public Member),and Deputy Commissioner Bill Noll (Designee for Department cf Community and Economic Development). Directors present in Juneau:Deputy Commissioner Tom Boutin (Designee for Departmert of Revenue),and Mr.John Winther (Public Member) 3.PUBLIC ROLL.CALL Staff present in Anchorage:Ronald W.Miller (Executive Director),James A.McMillan (Deputy Director-Credit),Valorie Walker (Deputy Director-Finance),Mike Harper (Deputy Director-Rural Energy),Brenda J.Fuglestad (Administrative Manager),Sara Fisher-Goad (Financial Analyst), Chris Mello (Program Manager),Teri Harper (Program Manager),Monica Moore (Program Manager),Bruce Tiedeman (Manager for Training &Rural Outreach),Mark Schimscheimer (Project Manager),Karl Reiche (Projects Development Manager),Brenda Applegate (Accountant), and Linda MacMillan (Accountant). Others attending in Anchorage:Brian Bjorkquist and Mike Mitchell (Department of Law),Jeff Staser (Denali Commission),Wayne Carmony and Don Zoerb (Matanuska Electric Association),Jan Sieberts (Washington Capital),Kathy Porterfield and Charles Kozak (KPMG LLP),Ken Vassar and Shelley Ebenal (Wohliforth Vassar Johnson &Brecht),John Robertson (Alaska Pacific Bank), Johan A.Dybdahl (Point Sophia Development Co.)Robert Wysocki and Don Rosenburger (Huna Totem Corporation),and T.N.Obermeyer (Self). 4.PUBLIC COMMENTS There were no public comments. 5.PRIOR MINUTES --October 15,2003 The October 15,2003 minutes were approved as presented. 6.OLD BUSINESS There was no old business. 813 West Northern Lights Boulevard *Anchorage,Alaska 99503 AEA Board Meeting November 17,2003 Meeting Minutes Page 2 Hearing no objections,the Board took up item 8A at this time. 8A.Director's Status Report of AEA Programs and Projects Mr.Harper said the mission of the Rural Energy Group is to assist in the development of safe, reliable,and efficient energy systems throughout the state,especially in Rural Alaska.Mostly that are sustainable and environmentally sound.At the same time we are trying to reduce the cost of energy in Rural Alaska. e =Training Program Mr.Harper reviewed the training program stating that we must train the people in order to have the facilities functioning correctly.The objective is to provide the necessary training and the skills for these rural operators so they can run the utilities efficiently.The courses we offer are the advanced power plant operator training,bulk fuel training,hydro training,and utility clerk training. Most of the programs are worked jointly through AVTEC.We received $300,000 from the Denali Commission for training programs this year.Construction management contractors are used to train people in the bulk fuel area as they are the ones that construct the bulk fuel facilities.The goal is to provide a fuel experience in addition to getting them basic skills to allow them to work on these projects and to also have a skill as they go forward with the construction in their villages. Some key training is welding,pipefitting,electric,carpentry work,and building maintenance. We have found that we are doing a better job about training the mechanics and electricians and technicians in the powerhouse.Where we see we need more work is in the management end of the training.We have been working with Sheldon Jackson to provide a village management institute.We are taking village leaders and training them in about a 10 day mini-MBA program in conjunction with Sheldon Jackson. Chairman Barry said he understood that the thrust of the program is to try to get some stable development in Rural Alaska for maintenance of the facilities.He said that on the Energy Task Force they have learned that there is a serious issue with the existing utilities in terms of work force development.If they continue their training that will open up opportunities for them in others areas as well. e Power Cost Equalization Program Mr.Harper reviewed the Power Cost Equalization Program (PCE)stating that the program has been around for approximately 20 years.He said the notion was how do you provide power and somehow try to equalize the power for Rural Alaska.We share the administration of the program with the Regulatory Commission of Alaska.The goal is to equalize the high cost of electricity in Alaska.PCE is the core element to ensure financial liability of a centralized power system in the rural areas.Not all of the communities are eligible to receive PCE.The communities that are eligible receive credit for the first 500 kilowatt hours each month.The Regulatory Commission of Alaska determines the level and AEA administers the fund.The formula is 95%of eligible cost per kilowatt hour,which is between a floor of 12 cents and a ceiling of 52 cents.The total number of eligible customers in Rural Alaska is 27,000.The total kilowatt hours sold is 400,000,000 and the total eligible kilowatt hours are 123,000,000 (31%). The program is not fully funded and we are at approximately 83%funded. AEA Board Meeting November 17,2003 Meeting Minutes Page 3 The PCE endowment fund was established in 2000 with $100 million capitalization from the CBR; and approximately $80 million from the proceeds of the Four Dam Pool Sale.The notion is that approximately 7%of the market value may be appropriated to fund the program each year. Chairman Barry said that we actually dip into the principal of the fund to maintain the 15.7%.Mr. Harper affirmed this statement. in response to Board questions,Ms.Harper stated that FY2000 was the first year that commercial customers were removed from the program so it was an adjusting year,so it took approximately a year or so for the new legislation to take hold.Mr.Miller stated the fluctuations between the years were due to program changes. e Denali Commission Overview Mr.Staser,Denali Commission,said that if the Denali Commission can maintain the current funding level,they will be done addressing all of the bulk fuel problems by the year 2007.The program will then close down and the people on the staff at the Denali Commission will go home to their parent agencies.That is why we borrow staff because we do not want them to have a vested interest in dragging out the program. He said that this is a state/federal partnership concept.The Co-Chair for the state is the Governor or his designee,and the Governor has appointed Lt.Governor Lehman as his designee.They also have staffed the commission with state employees.One of our newest additions is a staff member paid for by the CEO's of the ANCSA Corporation.Attached to our office is the Federal Department of Energy,and through them we get a lot of research and development support out of the University of Alaska's Fairbanks lab.We are all about sustainability and collaboration.Our policy advisory committee in the area of energy policy consists of the Regulatory Commission of Alaska, Rural Electric Cooperative,Alaska Village Electric Cooperative,and operators.They provide policy guidance to the Commission.The Staff makes recommendations based on policies the commission has promulgated.The commissioners vote on the work plan each year and we take that work plan forward to Congress.We are currently waiting for bills to pass that will actually fund our budget request.The Presidents budget for the commission is about $10 million and Congress has upped that to approximately $120 million in the current bill.He said there is a National Energy Policy Bill which is being considered which dramatically expands some of the roles of the commission and provide a continuous funding stream from the federal proceeds out of the NPRA for a period of 20 years (which equates out to approximately one billion over 20 years). He said the Denali Commission has a significant contribution to the state's training effort at this time with anticipated appropriations of approximately $7 million targeted to the training area. The Capital projects program at AIDEA,in addition to bulk fuel tank,DC has power system upgrades and line extensions as well as the new expanding mission in alternative energy generation.This must pencil out for us and the alternatives do not seem to compete as well as off the shelf diesel. Some issues that they would appreciate the Boards help on are issues dealing with insurance costs for rural utilities.We have a ongoing effort with the state of Alaska to address that. Continuing to focus on the economies of scale.The Commission from its beginning in 1998 called for community based plans to have regional support.The question we ask is who speaks for the region?One answer that we have received so far that seems to have merit under the state constitution is the Borough speaks for the region.So how can we facilitiate that dialogue to get some regional participation in the planning and execution of projects.We do not really care at the AEA Board Meeting November 17,2003 Meeting Minutes Page 4 Commission who speaks for the Region as long it is a unified voice that brings all of the regional activities into focus.Our next meeting is in January at which time we will be allocating resources to a priority listing to be developed by our staff.We will be looking at ways to drop the cost of power and make power more sustainable throughout Alaska.We will be looking at things like collaborative purchasing of fuel,regional economies of scale,and the insurance issue. Chairman Barry said the handout refers to Title 14 of the Energy Bill and is subtitled Rural and Remote Electricity Construction.What is the definition of rural and remote?Does this enable DC to get involved with the railbelt transmission extension if that were necessary? Mr.Staser said a lot of the interpretations will come out with the report language with the legislation as it passes and will provide us some guidance.If you note in the bill,they have referred to bulk rural electrification act which carries with it a definition.It also refers to the high cost areas where the cost of kilowatt generation delivery to a home is approximately 150%higher than the average nationwide,which should not be a disqualifier for any community in Alaska.We have yet to analyze what this language means because until it passes we are just watching like any other concerned citizen.Once it passes then we will seek some definition clarity.One thing the commission has avoided is adopting a definition of rural which can be quite constraining. Sometimes the most effective way to help a rural community is through an urban hub.From Washington D.C.,Anchorage looks pretty remote and rural. Chairman Barry said the Statewide Energy Task Force is looking at an energy policy for the state and they would appreciate your input in that. Mr.Staser said they applaud the efforts of this task force and for us as a federal agency,principally funded with federal resources,the question of how do you set criteria and how do you set priorities, we would love to be able to defer to a statewide plan to help guide that process.Right now we are acting in our best judgment with our policy advisory group.In the absence of the stateside plan,we will do the best we can.Having the plan in place will greatly facilitate the moving of the resources. 7A.FINANCIAL STATEMENTS/AUDIT PRESENTATION Ms.Porterfield,Managing Partner with KPMG LLP,summarized the audited financial statements and letter to the Board. She said the purpose of the audit is for KPMG to gain reasonable assurance that the financial statements are free of material misstatement.KPMG conducted appropriate audit procedures and has concluded that the financial statements are fairly stated in all material respects in accordance with generally accepted accounting principles,resulting in an unqualified or a clean opinion.KPMG obtained reasonable assurance during the audit that the financial statements are free of material misstatement. She said the Authority has very good accounting records and it was not necessary to propose any significant audit adjustments.The Authority has an effective system of internal control in place. 8B.NEXT MEETING DATE The board will be polled as to the next meeting date. 9.BOARD COMMENTS AEA Board Meeting November 17,2003 Meeting Minutes Page 5 There were no Board member comments. 10.ADJOURNMENT There being no objection and no further business of the Board,the meeting was adjourned at 11:08 a.m. Ron Miller,Secretary Alaska Industrial Development and Export Authority AI Alaska Energy Authority MEMORANDUM TO:Board of Directors Alaska Energy Authority FROM:Ron Miller liExecutiveDiletiér DATE:January 26,2004 SUBJECT:Alaska Iniertie Staff will update the Board on severalissues related to the Alaska Intertie including theattachedconfidentialproposalfromMatanuskaElectricAssociation. 813 West Northern Lights Boulevard **Anchorage,Alaska 99503 Matanuska Electric Association,Inc.CONFIDENTIALDraftProposaltoAlaskaEnergyAuthority Alaska Intertie Acquisition ****For Discussion Purposes Only **** Proposed Purchase Price:$75,000,000 Maior Components of Draft Pronosal 1.MEA will place its Hollywood-Douglas line into long-term service as an integral component of the Alaska Intertie. 2.The Railbelt electric utilities will enjoy unrestricted use of the Alaska Intertie, including the 115kV Hollywood-Douglas segment,to the extent capacity excess to MEA's needs is available. 3.MEA will repair/correct the Alaska Intertie snow loading problem,using the remainder of the $20.3 million state grant for Alaska Intertie upgrades. 4.MEA will return the Hollywood-Douglas line to 115kV operation,and will install 115kV to 138kV transformation at Douglas.This will allow north bound transfers to continue at 138kV.Funding for the 115kV/138kV facilities at Douglas will either be built into the basic wheeling rate or,depending on the cost of the snow loading corrections,from the remainder of the $20.3 million state grant for Alaska Intertie upgrades. 5.MEA will offer to contract with GVEA to provide maintenance of the northern sector of the Alaska Intertie. 6.The wheeling rate for use of the Alaska Intertie will be subject to Regulatory Commission of Alaska (RCA)jurisdiction. 7.MEA's acquisition of the Alaska Intertie will be contingent upon customary regulatory and lending approvals,including RCA approval of MEA's proposed accounting treatment for the transaction. 8.Future Alaska Intertie upgrades will be negotiated among the user utilities;the method . of cost recovery will depend on relevant circumstances (e.g.contribution in aid of construction;wheeling rate surcharge;renegotiation of basic wheeling rate,etc.) 9.The purchase price will be funded by a fixed surcharge (user fee)on the wheeling rate until such time as the purchase price has been recovered.Annual payments to the State of Alaska will fluctuate based on the level of wheeling activity. 10.The purchase agreement will provide that MEA's wheeling rate for use of the Hollywood-Douglas line remains unchanged during the transition period. CONFIDENTIALAlaskaIntertieAcquisitionAnalysis Annual kWh Transfers 100,000,000 200,000,000 300,000,000 400,000,000 500,000,000 Purchase Price:$75,000,000 Wheeling Rate Surcharge: 20 Year Payoff 0.0375 0.0188 0.0125 0.0094 0.0075 25 Year Payoff 0.0300 0.0150 0.0100 0.0075 0.0060 30 Year Payoff 0.0250 0.0125 0.0083 0.0063 0.0050 35 Year Payoff 0.0214 0.0107 0.0071 0.0054 0.0043 50 Year Payoff 0.0150 0.0075 0.0050 0.0038 0.0029 Years: Present Value of Proposed Receipts for transfer of Alaska Intertie 20 25 30 35 40 45 50 too8Nwpaeeeeeeeeee'NOnhfwn-COOONDONEWN==18 NPV @: 5% 6% 7% 8% 9%oooo3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 0 ooo°o3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 0 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 0 ooo°o2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 2,142,857 0 ooo0 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000 oooo1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 1,666,667 0 0 0 0 0 ooo°o1,500,000 1,500,000 4,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 41,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 075,000,00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 075,000,00 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 075,000,00' 0 0 0 0 0 0 0 0 0 0 0 0 0 0 075,000,00:ojoo0oo0oo0o0oo0ooco0o0so75,000,00'75,000,000 75,000,000 38,447,592 34,069,695 30,307,960 27,062,368 24,250,845 Assumptions: Assumed repayment 34,785,369 30,376,846 26,671,388 23,538,838 20,875,689 31,617,384 27,257,589 23,666,995 20,687,017 18,195,289 28,866,622 24,608,505 21,166,537 18,356,690 16,041,006 75,000,000 with no interest No payments until 4 years after transfer occurs No change in annual payments (note that this is not expected,since kWh are expected to fluctuate) 26,469,043 22,346,393 19,070,057 16,434,275 14,288,972 24,371,286 20,404,111 17,299,312 14,833,395 12,847,524 22,528,793 18,727,305 15,792,785 13,487,965 11,648,299 CONFIDENTIAI