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HomeMy WebLinkAboutAEA Board Meeting June 12 2008=ALASKA Go ENERGY AUTHORITY Mee >Powerseta"(Systems and _..aan ita.a . 5 PON ge at (&Ereshe,ee *jae 7,4 -fete?HRN:at weChuathbaluk -Before':(NASA Kongiganak Right-sized,code-compliant,sustainable facilities.Right-sized,code-compliant,sustainable facilities.Right-sized,code-compliant,sustainable facilities.Right-sized,code-compliant,sustainable facilities. ey ES ANSIBefore'"After AEA Upgrades 2000-2006 |! ;¢Nanwalek °KwethlukDeeringePedroBay©Igiugig _@ Larsen Bay ®Kokhanok ©Little Diomede @ Aleknagik ©Deering ©Golovin @ Nikolski @ Nunam Iqua ®Clark's Point ©Kotlik ©Kwigillingok ©Tuntutuliak ®Kongiganak e@ Tuluksak naa -_©Akhiok e HughesAEAwantsto¢go9 the distance ©Tenakee Springs ©Koyukuk-@ False Pass @ Arctic VillageAEAhas:been able to©upgrade 50%of the e Ak e Akiachakaeowercupplysys@-_>ENERGY AUTHORITY utan iacha 'tems statewidein @ Nelson Lagoon @ Chenega Bay villageson the defi-@ White Mountain ©Egegikfrom'the benal nap @ Atka @ Lime Village Commission.e Sterling Landing ©Emmonak Almost 80%of the bulk fuel facilities are @ Whitestone @ Nikolai done,leaving some 20%remaining across ®Port Lions ®Buckland rural Alaska.@ Karluk @ Alatna Training rural residents to manage their ®Middle Kuskokwim e Chignikfacilitiesandbulkfuelinventoriesisongo-Proiect:Aniak . ing and critical to the long term sustain-croject aK,¢Port Heiden ability of the energy asset.AEA teaches Sleetmute,@ St.Georgebestbusinesspracticesandhelpsmanag-Crooked Creek,®Tananaerstocreateandfollowbusinessplans.Red Devil,Takotna,©AllakaketTrainingofpowersystemoperatorsspansmn : . "Stony River and ©Chionikbeginningtoadvancedandisconductedon-A.ark.E "yl y Chuathbaluk Chignik Lagoon site,as well as in the classroom.Placing tanks;-a @ Napaskiak ®Kiana Additional resources are needed to bring ey ®Noorvik e Stevens Village rural Alaska infrastructure up to code.on Diomede;hy e Old Harbor ®ManokotakAEAhastheexpertisetofinishthejob.©Port Graham @ Chefornak"Rightsized,codecompliant,sustainable facilities."Right-sized,'code 'compliant,sustainable facilities.FN a pene jes pes f=-ALASKAquENERGYAUTHORITY|Bay Remote "*Power Systems me eeash;>raeBaarcayEYTie |Kongiganak Right-sized,code-compliant,sustainable facilities.Right-sized,code-compliant,sustainable facilities,Right-sized,code-compliant,sustainable facilities.Right-sized,code-compliant,sustainable facilities. SKA«==/@&-ENERGY AUTHORITY--- After AEA Upgrades 2000-2006 sna &Nanwalek ©KwethlukDeering©Pedro Bay ©Igiugig e Larsen Bay ®Kokhanok ©Little Diomede @ Aleknagik @ Deering ®Golovin @ Nikolski @ Nunam Iqua ®Clark's Point @ Kotlik @ Kwigillingok @ Tuntutuliak @ Kongiganak @ Tuluksak ;_ @ Akhiok @ HughesAEAwantstogo'the distance ©Tenakee Springs ©Koyukuk .-e False Pass ®Arctic VillageAEAhassbeenableto°upgrade 50%of the e Akutan ©Akiachakpowersupplysys-a:ENERGY AUTHORITY Nel L h Btemsstatewidein@NelsonLagoon©@ Chenega Bay villages on the cet @ White Mountain ¢Egegikciencylist,with help .. from the Denali °ae band:e ame eseCommission,e erling Landing ®Emmona Almost 80%of the bulk fuel facilities are @ Whitestone @ Nikolai done,leaving some 20%remaining across ©Port Lions @ Buckland rural Alaska,@ Karluk ®Alatna Training rural residents to manage their @ Middle Kuskokwim e@ Chignikfacilitiesandbulkfuelinventoriesisongo-Proiect:Aniak . ing and critical to the long term sustain-rrojecr:aK,@ Port Heiden ability of the energy asset.AEA teaches Sleetmute,@ St.Georgegbestbusinesspracticesandhelpsmanag-Crooked Creek,©Tananaerstocreateandfollowbusinessplans.Red Devil,Takotna,©Allakaket Training of power system operators spans Stony River and ®Chianik Lbeginningtoadvancedandisconductedon-oy Chuathbaluk ignik Lagoon site,as well as in the classroom.Placing tanks;”®Napaskiak @ Kiana Additional resources are needed to bring Min i ®Noorvik @ Stevens Village rural Alaska infrastructure up to code.on Diomede:4 4 4 ©Old Harbor ©ManokotakAEAhastheexpertisetofinishthejob._"©Port Graham ©ChefornakrR[Right-sized,ode compliant,sustainable facilities.Right-sized,code compliant,sustainable facilities,st cate akwe Sock Brenda Fuglestad From:PAUL KENDALL [pauldkendall@yahoo.com]Sent:Monday,June 09,2008 12:22 PM To:Brenda Fuglestad Ce:pauldkendall@yahoo.com Attachments:2128055199-5-27-08 responsible parties.doc;1831355497-5-23-08 RDA -AGIA.dac; 647961725-6-3-08 E-mail to AGIA.doc;1687072382-6-3-08 ltr to AGIA-plea.doc Date:6-9-08 Monday To:AJDEA -AEA board of Directors %Ms.Fuglestad From:Paul D.Kendall Ref:upcoming board meeting Ms Fuglestad,could you please arrange my incoming commentary by earliest date on top leading to most recent date toward the bottom? Thank You,Paul D.Kendall Date:4-29-08-5-27-08 From:Paul D.Kendall To:Personal Reflections Ref:The continuing ongoing and nearly,daily unfolding of events and disclosures surrounding our families "Life Essential Energy Needs"ENERGIES like price volatility-instability-accountability,ownership, control,management,impacts,revelations,decisions,importance,insights,events,and overall increasing public awareness and concerns demands of us,that,we, as the general citizens who's God given rights of ownership in common benefit, precede all less than best beneficial contracts,and, are the rightful owners,stewards,and guardians of all resources;including,but not limited to our "Life Essential Energy Needs"--ENERGIES we all need in order to sustain our lives,and a tranquil and orderly and "quality of life”life styled society; hereby,demand,compel,order,and so direct with clarity of intent and mission,our leaders;ail leaders, to intervene and bring about public debate and dialog for the resolution and determination so as to bring about clean and reasonable energy reliability,access,and viability for our residential sector with all due haste... We find this directive necessary in light of the Most recent event: "Global Oil Companies publicly and officially notify Alaskans the resources of the state are theirs until they say or agree that they are not..The state drafted a contract in the Global Oil Companies favor"....(these are my interpretations !pdk) Ladies and Gentlemen, The reason we are in this "growing and becoming more unpredictable"energy dilemma like predicament is because we have not been attending to,and are not now,attending to, our "Life Essential Energy Needs"design and construction. The public servants,the corporations,you guys,and us the general citizenry have failed!;And,them, you,and us have failed miserably and undeniably. It is time to end this dark sided and never ending morass of energy instability and uncertainty impacting our homes and loved ones.(not to mention every living creature on the planet) This is not about Republican or Democrat -. .Its about "Our Homes &Children's Future Alaska”.--"Life Essential Energy Needs" magnetic fields--electricity &hydrogen--water Thank You, Paul D.Kendall Msg.land line 907-222-7882 E-pauldkendall@yahoo.com current cell 884-2424 5-23-08 5-28-08 6-1-08 RDA hosted AGIA panel question posed anonymously, but not asked -Paul D.Kendall First,Thank you all for your hard work and commitments to bring development and value to our Alaska owned Resources. Now!Let's get real asin:Real Responsible ! You want to_bet on a possible 40 Billion dollar gas pipeline to bring us a_possible - --$1/2 Trillion dollars in future revenue. Well,Alright,We are with ya!One for all and all for one -All the way! BUT: With the rest of the world racing to become electricity and water energy technology based societies,we would like $20 BILLION DOLLARS -Up Front,and in Cash; To be used to immediately construct 100+Hydroelectric Projects statewide,so that our energy needs for our homes and families will be secure and out of economic harms way! AND,in this way,we can be your insurance;We will watch your backs; Just in case something goes wrong with your/our Gas Pipeline endeacvor! And;Where or where is Steve Haagenson,AEA,Chugach Electric Association,and our "Alaska's Vision of Energy Coherence”? I am very concerned that the leaders and our general public are not aware of our Primary Mission as a society is to secure a stable or "Quality of Life”community; It is our communities of Families and Homes which we are obligated to serve first.....And in doing so we must understand that Harmonic Energy Fuels are in harmony with Nature and other Life Force Cycles ! Magnetic Fields ie ------Electricity (Father fuel or Energy) And Hydrogen Molecules _ie ------Water (Mother fuel or Energy) OUR BACKBONE or FUTURE FUEL STREAMS will be HARMONIC ENERGY FUELS ! are the principle of all fuels!.....Do you agree or disagree ? Aren't Nearly all fossil fuels directed or tied in some way to Hydrogen and or Electricity needs and functions? Paul D.Kendall -907-222-7882 907-884-2424 E pauldkendall@yahoo.com date:6-03-08 tue From:Paul D.Kendall Ref:AGIA ---HYDROCARBONS and HYDROXYGENS =harmonic fuels PROJECTS Ladies and Gentlemen... I know this may be suspect to you,But,now you must complete the journey! There is it seems to me;some form of "law of duality"and contrasts and things of 2s which requires balance. (like two hands,two legs,tow eyes,----good/bad-day/night-love/hate-young/old-man/woman etc.) |know most of you are Oil and Gas as most of us become what we study or work at; However;your true composition is Hydrogen as in Hydrocarbons..You must now realize you of all people understand the need to Marry the Two and COMPLETE THE CIRCLE..you are not done and complete until you do this!You can assign the project and overlook while you stay focused on agia....° You have and are learning us all up --IT is a magnificent thing you are all doing! We are all now ready for the final course...hydroelectric to our all electric homes and transportations--- Yes,just as you thought you were done or near the end ---' Well,if it is any consolation,,,we are all more than we realize,we are those people we have been waiting for...we are all in the place we are supposed to be when we are there...you either make history or you watch history being made.. Alaska has pumped enough Hydrocarbons into the world,it is now time for us to bring a new life energy to the world in balance.....we can deliver the new society like no other land can....And you,yes you and the rest of us must do just that or at least try our best... You have 60 days to complete and bring to balance this task to Change the World..|suggest you get started ...God made it in only 7days,you have more than ample time!at least to get started..we are all waiting for more of your like kind to surface....lets see who pops up when you announce Hydroxygen Project...Harmonic Fuels and all electric residential society !!!! YOU PEOPLE,OUR PEOPLE,ARE "UNFOLDING AND EVOLVING US" TO A NEW PLACE... That place ladies and gentlemen, |suggest to you is A NEW ENERGY AWARENESS AND HOW IMPORTANT IT IS TO US AND EVERY LIVING LIFE FORM AND CREATURE ON THE PLANET...if we are going to make it we are all going to have to come together and understand energy,and Alaska and you folks may be the stuff stories are made of that our children tell their children of how we became a new society and Alaska led the way ---- Paul D.Kendall Page 1 of 2 Date:6-3-08 Tue To:Gov.Palin,T.irwin,P.Galvin,M.Rutherford --This is considered to be a public/open letter From:Paul D.Kendall Ref:AGIA Concerns lam requesting,beseeching,pleading,you all to Please consider the following Comments. (see my letter to or Governor Palin dated 5-17-08 Spoof press release-Unconfirmed press releases) Stay with me here,its looking to get a tittle rocky,but; If you launch a major BACKBONE Hydroelectric Associates Future Fuel Streams (Harmonic Fuels Project) commitment you may very well,in essence,establish world wide recognition ! All of you,our Govenor and all those who can see how big this is (legislature)may go down in history today,tomorrow and even longer.....You are stepping out in front...you already have and now you would be ramping and magnifying it up to a whole new level.....You can do this..1!!!The whole world may turn to look your way! And,if they do,you win even more.You have a chance to have it all! Boy,try this one-- By you launching and implementing this parallel and dual Hydrogen Partnership Project (hydrocarbons and Hydroxygens-HARMONIC FUELS)of Sub-surface fossil fuels AGIA and Surface water fuels (project name?genesis by Alaska?) The World Oil,Gas and Energy Producers will only have 3 choices!You will have boxed or "corralled in the engagement”to a given parameter of expectations...and outcomes; 1...The producers will line up at your door with a change of or reconsideration of the pipeline project; In short,they will want to do it on your terms or together!Now! 2...They will in essence accelerate their intentions of not going anywhere with AGIA,the pipeline or Taps;Which will help us because time and resource focus is of the essence in this project and history. 3...They will confess to an "Epiphany Moment”and suggest they and Alaska join in a partnership which will be the stuff dreams are made of !And if this partnership comes about it will behold a new age and a new society for Alaska !(The age of Harmonic Fuels is huge and they can bring it to the table!) You will have checked,stalemated,or check mated your endeavors;But,you/we will not lose. (Also,|feel there is a bigger mystery here with the 5+producers that is waiting to be flushed out!) Page 2 of 2 You and we cannot lose!Either way,we win;However by launching a major Hydroelectric Program you may heighten and accelerate multiple revenue streams and their income; You will ride two Histories at one time ---The New Energy Based Society of Huge Proportions and The Death of or Metamorphosis of the Fossil Fuel Network to clean hydrogen whose price predictability _and availability will be so volatile you will make a lot of money from exporting fossil fuels.....possibly beyond your imagined thoughts! LADIES AND GENTLEMEN,YOU WILL WALK AWAY WITH ALL OF IT !YOU ALL WILL BE EVEN MORE SPECIAL THAN YOU ARE,,,NOW! Like two hands holding a child in each one,you will signal,inspire,and lead the rest of Alaska and possibly the World in introducing a new age of ENERGY AWARENESS and how to handle the duality of this rapidly approaching new energy history of the Planet... THERE tS A CHANCE,YOU MAY VERY WELL,"CHANGE THE WORLD”LADIES AND GENTLEMEN! And the best part of this is;We all get to come along with you because you are our people as we are your people...”The people of Alaska --the last and next great new frontier ..”.HARMONIC ENERGY Thank You,Paul D.Kendall Msg.222-7882 ---Cell 844-2424 --pauldkendall@yahoo.com Ps...--Did |mention you can complete this transition infrastructure society in 4 to 10 years? ----(but,remember,you must pump out as much gas as you can as possible because if the dollar dies and new technology trumps,you lose,,,,grab the money and immediately build ENERGY and WATER, FOOD,COMMUNICATION,TRANSPORTAION generations and storage systems-wait ,this is another discussion!And please don't forget population formulas -which can undermine and impact hugely) ----(hey big dog!,Mr.Irwin,|think the young guy Mr.Galvin will deserve some additional recognition later!Eh?And many others-too,,|know) --did you see the HICE hydrogen BMW add on tv Sunday ?We at BMW are ready if you want hydrogen! Also,with your permission,|am dropping off 3 color 11x17 pictures.. 1 =one of which is an example of an all electric and hydrogen home of the future=Harmonic Fuels! 2 =well,this picture#2 is a personal discovery moment which may portend the other future to come If you do not fulfill your calling on our behalf. 3 =Shell GTL fuels add -you should see RRoaMe3__Potential Major Alaska Hydropower Projects Project Name River System Installed Capacity Energy (Megawatts)(Million KWH/yr) Holy Cross Yukon 2,800 12,300 Ruby Yukon 1,460 6,400 Rampart Yukon 6,000 34,200 Porcupine Porcupine 530 2,320 Woodchopper Yukon 2,160 14,200 Yukon-Taiya Yukon 3,200 21,000 Susitna Susitna 1,500 6,500 Chakachamna Chakachatna 320 1,600 Wood Canyon Copper 3,600 |21,900 Stikine Stikine 2,260 9,900 Note:Chugach Electric Energy Sales approximately 2,500 million KWH ._,.Inventory of Alaska Hydropower =Potential »U.S.Bureau of Reclamation U.S.Army Corps of Engineers 256 sites with continuous power greater than 2500 KW 192 billion KWH energy potential 40%of the United States'untapped hydropower /éf XN e/3; > Alaska Energy Solutions Eric Yould , for \ Alaska Common Ground N May 3,2008 \N gy Gi Eas GS |! 8 -" é, | At Shell we like to challenge conventional fthinking-like that inscience and technology.How else can we progressand make thingsbetter?How else can we tackle the hugeenergychallengestheworldisfacing? Our scientists feel hee to break rules thal suy providing energy couldmeanimpactingonourenvonment,or that diesel luel hus a dirty 37image.They refuse to believe that alernative fuels can't help reduce oispoltukon.In fact,they don't even want to follow the most busic rule ofoll-that liquid fuel has lo come hom oi. Here at Shell we know that wn order fo reach @ new destinakon,yousometimesneed0newstartingplace,even id that means redefining theguidingprinciplesofonentireindusiry.We wondered.Could we make@dleonesfuelfromsomethingmoreplentifulthanoi?Could we create@Squidfuelfomnciurulgas?And could it rum in regular diesel engines? Thirty years ogo many industry experts thought #would be impossibletomakeGastoliquids(GTl)Fuel economically viable.However,someofthebestthinkersatShellrefusedtolisten.As a result of thei:persis.tence we hove created ©breakthrough fuel that is cleaner than everbefore.By starting from natural gos instead of crude od,we created a & ADVERTISEMENT RTSaalCREDAENEeeee|+Bef=[-|eo «cars.And the technology serves as a plaiform for the development of I of cables,vl come hom oll live coninets Upon completon@ wit'similar foals Irom cool ond biomass,helping Is ensure thot the energy produce 140,000 barrek/day of GT uel Gnd products.itis estimaied paneedsofowplanetwillbemetforgenerationstocome.i there will be enough GTl Fuel to help improve cir quality in up tol 0Rimegocitiesaroundtheworld.Shell dorted the work's first commercial GT plan o's type in Bi,UaMalaysiain1993-by 2003 it wos capable of producing 14,700 jail Due fo sfort up around the end of the decade,the plant will make ShellborrelsofGTFuelperday,ond Shel was ready to toke GT to the nest @ global leader in the GT industry.More importantly,@ can help tolevel.tr July 2006,Shell ond Gatar Peiroleum announced the founch improve city oir quality and help us to meet the global energy challenge.of Peart GTL in Gotar,the largest integrated GNl project in the world.Pr.- :=At Shell,we believe in moking cleaner fuels o global reality,and thattokingagion?leap forward often means slepping out of bounds.Think-the planet-comprisingopproximotely900trifioncubicfeetofproven |ing bigger for o better world-that's our philosophy for the fulure.reserves.This mokes i he ide location for the frst world scale Shell ha |be :The vast scole of the new plart is @ lestoment io the commimert of Shell - epee be pln inching 50,000 oe ct piping ee 1,800 em 2.sevens eet .Paul D.Wi Pky 7.BonShea!)' 2t.=é ny9.8'sqG'3*4e>;Fd betth ;: iy'i » ¢ ° r} ,>.| a a ' a :o =}.P|:G sped,ailaWEHAVEAPPLIEDSOMECREATIVE*THINKING TO:THE CHALLENGE OF.= |CITY AIR POLLUTION,THE RESULT.AoeTsaeREALENERGYSOLUTIONS|FOR THE REAL WORLB,,©we TO S88 THE FULL GTL STORY VISIT heRtaSHIELL.COM/UG/REALENERGY i i oOa:2ao6 L 4 te fay o a 'oOot&F ,p "a Z ; i e * :Pet a a i ,ae anes a"Gy |ot 'sh s, nee #8 podBe see --.pic tevin fon eae be]eam :S ot:om _4 8 VE Ry VEZ:HM Eight children of Moscow,all from two neighberhocds,share the same birth defect.Their deficiency,most missing the left forearm.More than half the children were from homes clustered in a few/Lis ad 2 'if,common plight was revealed when one of their mothers,Tamara Kapanadze,on her owninitiative compiled widely scattered negighberhoods where the air and soil are heavily contaminated by industrial emissions.froW rv 9 +[fo Wwe2 ,/a map using data drawn from hespital archives and a factory that manufactures artificial limbs for such chil-Although no certain links can be drawn between these defects and Moscow's bewildering mix of pollutants, P .,¢l/ho eg dren.Since 1973,she discovered,at least 90 children have been born in Moscow 'vith terminal-limb the incidence of congenitally deformed children appears to be higher here than in Russia as a whole. 1CTUCE 8 , y Ud S SEO SET,*VEfiee(PS oe vee |v i .._WhatSNew uousoF THE FUTL YOU'RE THE MASTER; |THIS IS YOUR UNIVERSE_TOMORROW'S SMART GARAGE ISREADYTOOBEYYOUREVERYWHIM.COCf AE ASS /The garage of the future will still shelter your carandserveasaplacetostore your lawn mower and other indooroutdeor equipment.But according to visionaries we inter-weeeee1D.KendallF507227Bae viewed at organizations rangingfromtheUltimateGaragetotheElectricPowerResearchInstitute,in 10 years yourgaragewillalsobeasawyservicecenter.Multiplepowersystemswillensurethatyourhousecon-sumes -and generates energy as efficiently andinexpensivelyaspossible.A team of robots will automatically take out the trash,accept and sortdeliveriesandtrimyourlawn-but only if it needs it,And sensors will valet park your vehicles and keeptabsontheircondition.All you'll have to do is sitbackandenjoytheride.-CHARLES WARDELL Joly -2004¥PoP deusne®CAR TECH Pull up to your garage,press the park button,and infrared beams help your car guide itself intothebaycorrectly[1].Once parked,your car transmitsdatawirelesslytoadiagnesticstationinthegarage[2].The system's display tells you when it's time forregularmaintenance-like a 300,000-mile tune-up-and warns you if something needs attention,presentingallyouroptions.f you're handy,use the fouch-screen [3]to display your car's manual,and orderpartsifnecessary;it will then walk you through therepair.If you'd rather not sully your mitts,beam thediagnosistoyourrepairshopforanestimate.Themechanicscanusetheirowncomputerstodoqmorein-depth remote diagnosis and notify you if and whenyouneedtobringitin.A handheld camera lets yousendvisualaswellaselectronicinformation. SMART STORAGE Shelves [4]have built-in scales tokeeptrackofhowmuchfertilizer,grass seed andotherlawn-care products you've used,They automati-cally scan Radio Frequency Identification (RFID)tags inproductlabelsasitemsareremovedandreplaced,and update the inventory on your home computer,AnRFIDlabelmaker[5]lets you inventory the contents ofyourownstorageboxessoyouknowexactlywhereyoustashedtheholidaydecorations,To maximizestoragespace,all these boxes,as well as bikes,boatsandotherrecreationaltoys,are stored on the second{'ory with the help of an electric lift [6]. HOME POWER SYSTEM Your home will still be con-nected to the grid,but it will also include two of itsOwnpower-generating systems:a photovoltaic roofarray[7]that can deliver energy directly to your homeandahydrogenfuelcell[8],A central controller [9]coordinates these systems,When the sun is shiningandyouneedpower,the solar rooftop system sup- 20 Porutar science jut 2004 Seees,Aaney Se plies it.if it's a blue-sky day and nobody's home,the solar energy powers areformer,which extracts hydrogen from water:the hydrogen is stored safelyinasubterraneantank[10].Asa last resort,if it's cloudy and your fuel cell'soutofhydrogen,the controller finds out through the Internet which utilityhasthelowestratesatthatinstant,and draws from the grid. YARD CARE The irrigation system [11]goes online to cheek National Weath-er Service reports and municipal water restrictions,using the information todecidewhentowater.A sma army of robotic lawn maintenance tools canmakedecisionsbasedonthesamedata,and automatically groom youryardaccordingly.You'll have single-Function bets like a yard vacuum 112]ahxietoand edger [13],as well as a mower thattakesattachmentssuchasanaerator[14].- The bots rest on their charging stationsbetweenjobs. TRASH BOT A robotic trash can [15]sits onachargingstationbythebackdoortothehouse.It has an automated reutine to wheel itself to the curb on collection night, ONCEPT DOOR BOT Think of the door bot as a roboticgopher.It stashes packages from the deliveryguy.Once he keys in a one-time code andleavesyourpackagesinadouble-secure stor-age bay,the bot scans the embedded RFIDtagsandautomaticallycorrectshelforinthe finds and retrieves items tor you from thesecond-floor storage room,And it fetches andLputsawayyourtools.GyAWEBersVOEaltaceLoveeteWCfo"-£00pv0FeulKé.a/olA//puts the boxes on theidge(or freezer).It (ROUSE OF THE FUTURE CONTINUED ON PAGE 22}> INFOGRAPHIC BY KENN BROWN AND CHRIS WREN AMe0g he FUEOLE Mg me of POPULAR SCIENCE JULY 2004 21 ThE Forugt £...De y .mye ad ae es ust recon}fuss epplychesustty"Se vet uees GCingdifferentyouneedfcstarkly .3 oo eexweerQe : f :MOR Git kocktte eeriereen]amet lk ee Be nt BestereAWIALING Thiéty CAV Se Fhe}G7L Fuélt - With Méthaw [ur ver Uf HRS dt aapwithRivesofNycleosEx/Juwvé-ofOe@Grasar)Ay Seog kv -,pv 7 /=ALASKA4SFEs€=_)ENERGY AUTHORITYaxestAlaskaIndustrialDevelopmentandExportAuthority AGENDA Alaska Energy Authority Board of Directors Thursday,June 12,2008 Anchorage,Alaska 4.CALL TO ORDER 2.BOARD OF DIRECTORS ROLL CALL 3.PUBLIC ROLL CALL 4.PUBLIC COMMENTS 5.PRIOR MINUTES --April 10,2008 6.OLD BUSINESS 7.NEW BUSINESS 8.DIRECTOR COMMENTS A.Director's Status Report e AEA Programs e AEA Projects e 2008 Initiatives B.Next meeting date Thu.August 14,2008 9.BOARD COMMENTS 10..ADJOURNMENT 813 West Northern Lights Boulevard e Anchorage,Alaska 99503-2495 www.aidea.org «907/771-3000 «FAX 907/771-3044 e Toll Free (Alaska Only)888/300-8534 e www.akenergyauthority.org wk "AIDEN f=NonSrAlaskaIndustrialDevelopmentaeiExportAuthority MINUTES ALASKA ENERGY AUTHORITY Board of Directors Thursday,June 12,2008 Anchorage,Alaska 1.CALL TO ORDER Chairman John Kelsey called the meeting of the Alaska Energy Authority to order on June 12, 2008 at 1:53pm.A quorum was established. 2.BOARD OF DIRECTORS ROLL CALL Members present in Anchorage:Chairman John Kelsey (Public Member);Vice Chair John Winther (Public Member);Deputy Commissioner Brian Andrews (Designee for Department of Revenue);Emil Notti (Department of Commerce,Community and Economic Development);and Commissioner Leo von Scheben (Department of Transportation &Public Facilities). Vice Chair John Winther (Public Member)joined the meeting at 1:58 p.m. 3.PUBLIC ROLL CALL Staff Present in Anchorage:Steve Haagenson (AEA Executive Director);Ted Leonard (AIDEA Executive Director);Sara Fisher-Goad (Deputy Director-Operations);Mike Harper (Deputy Director-Rural Energy);James Hemsath (Deputy Director-Development);Chris Rutz (Procurement Manager);Jim Strandberg (Project Manager);Brenda Fuglestad (Administrative Manager);and Sherrie M.Siverson (Administrative Assistant). Others Present:Brian Bjorkquist and Mike Mitchell (Department of Law);Paul D.Kendall (Public); Percy Frisby and Andrei Chakine (Tlingit &Haida Indian Tribes of Alaska,Central Council). 4,PUBLIC COMMENTS A discussion ensued between Mr.Paul D.Kendall,Mr.Haagenson and members of the Board regarding public testimony.Mr.Haagenson stated that at the end of Mr.Kendall's public testimony if the Board Members had questions,they could be addressed at that time. VERBATIM You should all have a packet in front of you.My name is Paul middle initial D Kendall.|live in Anchorage.|have some background as an energy and political activist.|see something very very special in Alaska.It has to do with electricity and the moving of electricity to the residential units across your state.If |see some things that |think are of historical and monumental impact.|had thought you had received this packet well in advance of my arrival,you would be able to purview it as the packet itself with a list of discussions and questions.|believe that there should be a ton of questions after receiving a packet from me most typically.|didn't come prepared to just be able to just sit here and spiel something off for three minutes for somebody's entertainment or a quick presentation and |don't typically look to place a hook to gain another 813 West Northern Lights Boulevard *Anchorage,Alaska 99503-2495www.aidea.org ©907/771-3000 ®FAX 907/771-3044 ®Toll Free (Alaska Only)888/300-8534 ¢www.akenergyauthority.org AEA Board Meeting June 12,2008 Meeting Minutes Page 2 man's interest.I typically like to call the shots as |see them in honest dialogue between men and some great ideas in some direction we're headed.So |don't know where we are going in three minutes.|don't know too many men who can go some place in three minutes,but |will try my best to do that.First 1 want to inform you that |may be a candidate for the U.S.Senate.| am in the breach and taking strong consideration of that.If!join that will be of a multitude or purpose and one of them will be able to define energy for Alaskans as |think they need it because there may be a lack of leadership in that area. |would like to remind you,|would like to make a formal request of Mr.Haagenson,on the record,that is to get a copy of Steve Pratt's report to the Alaska Power Authority,which |was denied recently.|would also like to get a copy of the,|guess as |understand it,ISER was requested to do a study for you and |would like to get a copy of that request to ISER.|would like to get a copy of whatever the Board there furnished and this Board in reference to Energy and that's for the record.I'd also like to talk about financing some type of energy forum. |think Alaska is in a very very special place gentleman.This is,the magnitude of this is huge.| think some of the members of this board heard this the last time |was before you.|continue to see the largeness of that.Let me put this into some kind of perspective for you.I'm convinced that if 1 could tie you to a chair and play AGIA and Dan Dickison all day,it would kill all of you okay.The pain and the complexity of the gas and the fossil fuel distribution is just overwhelming.Now keeping that in mind,typically in trains-of-thoughts there's a thing called a dot and that is your center.The circle in a frame of thought is the outlying areas that lead to that and then you come to what is known as a spherical thinking,which is a ball like,which looks at all aspects of all agencies.|you look at what's happening up there on the slope with the oil and the gas,there is a great mystery as to what's happening here.Something is wrong in Alaska ladies and gentlemen.|think that your time is repeating itself in some type of cycle.In the early 80's you had a chance to be a hydrogen,you had a chance to be a geothermal,you were headed places where men dreamed of going.The bottom of the oil fell out,everything collapsed.There're dialogues (audio not clear)from Wally J.Hickel on geothermal.You had the first hydrogen study done that |know of in the world,241 pages (audio not clear)Old Harbor.You have a magnificent history.|would suggest to you that what is happening with the energy today is that you are about to see another smack down.This is going to come hard and fast.I'm very concerned about the mystery as to what has happened at last with that pipeline going half or two third's empty for twenty years.Keeping that in mind,if you look at electricity with the thousands of sites of hydroelectric potential that you have,you have the capacity to laundry an electrical infrastructure.If you move that infrastructure towards your homes you'll notice in your packets there I've delineated a home's many aspects of energy.Most people just think of electricity.That is not true.You have heating and cooking.Those are BTU factors can be converted to electricity.You also have transportation about a thousand gallons.If you move that to electricity you can initiate the electric vehicle.Then you come to water and trash and things like that.But in essence if you move that electricity towards the single family home,you in essence will stabilize your society,stabilize your work force and as you move electricity into that single family home you will move gas out.As that gas goes out it generates you another revenue market,in the open market.And it also begins to compound its impact because the money that you pay out now for gas and fossil fuels is an extrapolation of capital.Generally utility bill you have 15-20 percentage for operation and maintenance.The other 60-80 percent is called a feedstock which goes to the owner.So not only do you push the gas to the market to sell but you hold your capital within the community and the State of Alaska.There are AEA Board Meeting June 12,2008 Meeting Minutes Page 3 multiplying impacts of moving electricity to the home.If you continue to move that electricity into the home,you also stabilize your society which may also impact crime and lots of other social costs we're having to pay for.But in addition to that,if one of your homeowners can come to you and say they bought an electric car.The Chinese are introducing $11,000 124-mile range car in Austin next year.There are a multitude of electric cars coming to the market.If you initiate that electric car,now you not only save more money,but now you push out the refinery materials into the open market again stabilizing and increasing your cash flow.And when you -come into the totality of the breech of the electricity,you are now converging with hydrogen. And ladies and gentlemen,it's hard for me to talk unless you have a picture in front of you,from Popular Science magazine,it's worth a thousand words.That picture shows a house of the future.You'll notice that it shows down at the bottom a hydrogen tank and a hydrogen fuel cell, right?Now !'m not interested in the fuel cell.A multitude of corporations and individuals are. Powerful people.You'll notice BMW was on the weekend twice with their car made of water and the guy from BMW said "hey,we just you to know we're ready when you're ready.” Hydrogen is here ladies and gentlemen.In addition to that,|have a packet of information in the back of your book that shows in 1991 Dupont,Conoco Phillips,and some others,were able to manufacture hydrogen with a 1.7 year payback on their total investment.So we know it's here, okay?But setting the hydrogen aside,what happens with your society,if you implement the electrical grid system,the backbone of the great state of Alaska,you will stabilize all sectors, create multiple streams of revenue,and in essence you will technologically upscale your people. You will have a place in the world with recognition beyond your wildest dreams.You have a chance to have it all.All,gentlemen.So that's my ... End of Verbatim 5.PRIOR MINUTES -April 10,2008 The April 10,2008 minutes were approved with one correction:change spelling of the word trawlers to trollers on page 4. 6.OLD BUSINESS There was no old business. 7.NEW BUSINESS | There was no new business. 8.DIRECTOR COMMENTS Mr.Haagenson asked Mike Harper to provide an overview of Programs and Projects Updates. OVERVIEW OF AEA PROJECTS and PROGRAMS Mr.Harper asked Board members to review the AEA Programs and Projects Fact Sheets in their packets and contact him if they have any questions.He stated that at this time of year AEA is normally very busy building bulk fuel tank farms or power plants in the bush.However, AEA is not as busy as it normally would be because the same level of funding is not available AEA Board Meeting June 12,2008 Meeting Minutes Page 4 from the Denali Commission.Funds may become available at a later date,but they are down at least a third from previous levels. AEA has constructed over 60 bulk fuel tank farms and 30 power plants in the past 7-8 years. AEA is busier than ever with increased interestin alternative energy and the passage of House Bill 152.HB 152 is an alternative energy bill will have a huge impact on Alaska and will be facilitated through AEA and its Board. Mr.Winther asked if there were enough Bulk Fuel Loan Funds to cover the villages that apply due to the increase in gas prices. Ms.Anderson responded that AEA is in good shape,but has noticed an increase in average requests.The amount requested has to be weighed with the ability to pay it back. Ms.Fisher-Goad added that AEA Legislation House Bill 338 went through the legislative process last year.Originally proposed by AEA,the bill was introduced and carried by Representative Mary Nelson.The bill passed and is waiting for transmittal to the Governor. The bill included two amendments.One amendment,through the Committee,increased the maximum bulk fuel loan limit from $400K to $500K.Applications have been received requesting that higher dollar amount.The other change in the bill reflects the bridge-loan program, managed through the Department of Commerce,and is now in statute. A significant change allows AEA to use the Power Project Fund for cash flow purposes for loans which maximizes loan value.There are some limitations.AEA is conservative with respect to what was originally proposed.With the current increase in fuel costs AEA may use all of the resources from that fund.In the future,AEA may see additional pressure to increase the loan amount but that has to be balanced with the purpose of the loan and how it would be paid back. Ms.Anderson stated that there are currently three applications at the half-million dollar level but not all requests are approved for the amount requested.Mr.Haagenson asked if AEA anticipated running out of bulk fuel loan program funds this year and whether or not there is an 85%increase,to which Ms.Anderson replied no.She stated they have received 9 requests in the past week and expects an increase in applications in September.The applications,on average,were larger than previous requests.Mr.Haagenson asked if the increases were extrapolated out,would there be enough funds to cover an estimated $6 million dollar excess. Ms.Anderson replied that they were going to have to look at the potential for additional funding for the program,but probably not for this year.At this time the program is more reactive to people's needs and is repeat business,but 7-8 communities have come to us who in the past have always self-funded.In general there's more need. Commissioner von Scheben stated he had received an email about the high cost of fuel and perishable food supplies in bush communities.This person made a comment about some type of shift regarding people leaving the villages and asked if anyone knew of a shift because some of the villages are not able to hang on because of the high costs. Mr.Haagenson reported seeing a huge shift.George Cannelos,Denali Commission,hired ISER to analyze that shift from Bethel to Wasilla,from smaller areas into hubs,like Bethel. AEA Board Meeting June 12,2008 Meeting Minutes Page 5 There is a huge shift going on because the cost of energy is bringing the cost of everything up. He called it the death spiral. Commissioner Notti added that he heard Bethel had 34 homes for sale,a big percentage for the size of the community. Commissioner von Scheben said he was thinking of smaller communities like Chauthbalak and Kalskag and doesn't know how they can survive with fuel and milk that costs up to $10 a gallon. Mr.Haagenson said the smaller villages have been double whammied.One of the charts in the packet shows that in small communities,the energy costs might be the same (as /arger communities),but the average income is only half.In hubs like Bethel they tend to make more money so it is easier to absorb,but it is still hurting them.He spoke with a person in Bethel who said last year he had two apartment buildings 100%full,with a waiting list,but this year he only has 20%occupancy,a sign of worse things to come. Commissioner Notti said he thought there would be more demand for bulk fuel loan funds.Mr. Haagenson and Ms.Anderson both anticipated seeing an increase in demand.TBush Caucus is already discussing an increase in the bulk fuel and power project fund. Ms.Anderson said that AEA may be swamped with requests in the future,but it is not solely a matter of increasing funds,it's a matter of how they pay it back.The tougher question is,is it going to be affordable to these people to pay back these loans?Requests are coming in for $400,000,no matter what the needs is,but we do not always approve what they ask for.They may be approved for $200K or $250K,what we determine they are able to repay. A discussion ensued about how the high cost of fuel affects fishermen.They expect to catch one hundred million tons less fish in Bristol Bay this year because they are unable to compete with the price of Puget Sound Salmon. Mr.Haagenson stated that the first issue is a cash flow problem which is what a bulk fuel loan helps with.When fuel is delivered now,it must be paid for within 2-3 weeks.Moneys sits in the tank and no kilowatt hours have been generated to reap revenue.Making electricity from the really expensive fuel is going to make the price go up with no sales to cover the costs.As Chris said earlier "Is this a good loan to make and can they pay it back?”There may be risky times ahead. Mr.Harper distributed an information sheet about AEA Projects showing pictures of a tank farm before and after it received a new code-compliant sustainable tank. Steve Haagenson provided an update on the status of the Energy Plan. The Alaska Energy Plan is going very well.Meetings have been held in 26 communities.While on site in Chitina an extra meeting was conducted.Three more meetings will be held in Haines, Petersburg and Emmonak.Good information has been received and is being put into a matrix showing almost every community in Alaska.Across the top of the matrix are all of the resources available.The matrix will then be matched to the energy required to run each community which AEA Board Meeting June 12,2008 Meeting Minutes Page 6 includes electricity,space heating and transportation.You will be able to look at the community needs and compare it with other options. For example,while the group was in Bethel,one community member mentioned that when he was a kid his job was to clean trash out of the flue at Nyak.What and where is Nyak?It is a hydro project about 60 miles from Bethel and when you think of Bethel,you don't usually think of hydro.There is another site right next to it called Kisaralik which an in-house hydrologist said generates approximately 30-megawatts.Mr.Haagenson looked at the estimate required for energy for space-heating and electricity in Bethel,converted it to BTUs from diesel fuel and then converted it to electricity.Approximately 17 megawatts were needed so now a possibility exists that Bethel can run on electric heat.This is the value of understanding what energy needs are required.A resource can be matched with a need.Installation of heat pumps can actually reduce the amount required for space heating by a factor of three,If you had 12 kW electric heat in your house,you'd drop down to four.Options like this are being explored that would allow a mini-grid around Bethel that picks up all of the communities on the Kusko-Delta and provides electric heat and electricity for their homes.This is the value of the process we are going through right now. Mr.Brad Reeve from Kotzebue said that when they built the local hospital they drilled a hole down to water-well depth and found 160-degree water.A geothermal site in Kotzebue will now be investigated.The comments from community meetings have been very valuable and the communities are going to get buy-in because they are now part of the process. A Technology Day is being planned to explore the different technologies required to convert the energy sources and put each community need together with the resources available and make sure that those energy sources match.We are on right on track with this project. There is information in the board packet on the energy relief plan marked confidential.Any discussion or questions require the Board adjourn to Executive Session. The capital budget has been approved with a 60-day statutory limit to make agreements for transferring funds and finalizing agreements with the different recipients.An attachment shows the energy projects that were approved from the capital budget.When Sara Fisher-Goad testified on HB 152,she informed the legislature that we could use the existing RFP.We have an RFP for approximately $4 million dollars for the Denali Commission and $1 million dollars for the Alaska Energy Authority.If we need additional funds we can use that RFP to award HB 152 funds.Prior to that,we have to work with Alaska Legislative Budget &Audit Committee (LB&A) to get approval and the list from them.When the RFP went out it had a couple of limits:(1) "construction of a project with a cap of $1 million dollars”and (2)"for preliminary work with a cap of $100,000.”We are looking at the possibility of awarding funds from that initial RFP in the near future upon approval from LB&A. A Request for Applications (RFA)will go out later this summer that will allow us to do a rapid evaluation and we would like to publish the RFA for the remainder of the $50 million dollars for this year. Funds were approved for Susitna Hydro.AEA will do an evaluation and assessment of need to determine what the utilities need for electricity,look at future loads,and an integrated resource AEA Board Meeting June 12,2008 Meeting Minutes Page 7 plan.The next step will be to determine what the river can produce for as far as hydro-electricenergy., In response to a question from Commissioner von Scheben,Mr.Haagenson stated the previous Susitna Hydro study was for a 1600 megawatt project with a cost to build the plant estimated at approximately $10 billion dollars.Mr.Haagenson feels this was too big so AEA needs to determine how big it should be and once that is identified,go to the river and decipher what the river can produce.There are some interesting studies after the fact that if you were to build with thin-shell concrete,like the one in the Devils Canyon Dam,you run a river back and even though it's a 1600 megawatt capacity,only 100 megawatts of water runs through that small impoundment area.If you put the big one in,the Wantana Dam,you'll likely get 1000 megawatts,but it costs the most.So the question is,is there some way to put both of them in so you get close to 600 megawatts at the bottom,because it holds back most of the water.We are looking at different sizes and options that will give us 600 megawatts at a low cost. Commissioner von Scheben asked if the environmentalists will buy into the project this time. Mr.Haagenson said that in his opinion the reason the original project was killed was not because of environmental issues,but mainly because it was going to power a smelter.They said they didn't want a smelter there and made sure it didn't happen.At the same time oil went to $9 a barrel and it was decided not to waste time when oil was so cheap.That was what was on their minds with the previous Susitna study.A friend who worked on the project said that if it had been built,we would probably have two-cent power up and down the railbelt and $30 billion dollars in the bank.What's the best time to plant a tree?30 years ago,and the second best time is today.We owe it to Alaska to take a look and see if it makes sense and move forward. It it doesn't,we'll look elsewhere. Commissioner von Scheben stated that he previously offered DOT services,which caused some confusion.He suggested that if villages or communities fairly close to each other could be connected by road,if they don't exist right now,they could share services such as a single- power plant,transmission lines,schools,and clinics (e.g.St.Mary's and Mt.Village,Upper and Lower Kalskag). Mr.Winther asked if any of the current hydro projects in the state have not been hugely successful,maybe not at the time they were built,but at this point in time.Mr.Haagenson said there are not that many in the state:Eklutna was built by the federal administration;Snettisham; Cooper Lake;Bradley;Swan Tyee;Terror Lake;and Solomon Gulch.Mr.Winther said they probably produce the cheapest power there is right now.Mr.Haagenson said that in Wrangell 150 people have converted from oil heat to electric heat.Mr.Winther said you can't build enough hydro soon enough,regardless of the cost.To a certain extent,if the size is doubled it's still going to be perfect in 20 years.Mr.Haagenson said you get a very stable price.Once you make the investment in the dam you know the price forever., Commissioner Notti added that when the Eklutna hydro project was built,the headline in Anchorage was "enough energy to last 100 years.We're going to have more growth in Alaska,”but we didn't expect it to be this big. Mr.Winther said that in the last two years Petersburg has gone from 40%usage at Tyee to 60% usage by converting to electric heat and other things.A hydro project big enough for the long AEA Board Meeting June 12,2008 Meeting Minutes Page 8 term just can't be built.Mr.Haagenson added that the challenge is finding one that has a high- level wake which doesn't affect fish runs.Technology is improving at hydro-kinetic sites,so all different resources are being considered.Tidal wasn't really available 20-30 years ago,but it's getting closer today. The next AEA Board meeting is scheduled for August 14,2008. 9.BOARD COMMENTS Mr.Winther stated that he enjoyed working with the new AEA Executive Director,Steve Haagenson. 10.ADJOURNMENT There being no objection and no further business of the Board,the meeting was adjourned at 2:36 p.m. ZZSteveHaa§enson,Executive Director/Secretary Alaska Energy Authority MINUTES ALASKA ENERGY AUTHORITY Board of Directors Thursday,April 10,2008 10:30am Anchorage,Alaska 1.CALL TO ORDER Chairman John Kelsey called the meeting of the Alaska Industrial Development and Authority to order on April 10,2008 at 10:30am.A quorum was established. 2.BOARD OF DIRECTORS ROLL CALL Members present in Anchorage:Chairman Goin Kesey Publ Member);DeputyCommissionerBrianAndrews(Designee for Department of Révenue);Emil Notti (Department of Commerce,Community and Economic Development). Vice Chairohn WintherYPublic Member)joined the meeting at 10:47am. Participating by Teleconference:Commissioner Leo von Scheben (Department of Transportation and Public Facilities);and Commissioner Patrick Galvin (Department of Revenue). 3.PUBLIC ROLL CALL Staff Present in Anchorage:Sara Fisher-Goad (Acting Executive Director);Chris Anderson (Deputy Director-Credit);Mike Harper (Deputy Director-Rural Energy);James Hemsath (Deputy Director-Development);Valorie Walker (Deputy Director-Finance);Chris Mello (Program Manager);Karsten Rodvik (Program Manager-External Affairs);Chris Rutz (Procurement Manager);Mark Schimscheimer (Project Manager);Jim Strandberg (Project Manager);Brenda Fuglestad (Administrative Manager);and Sherrie M.Siverson (Administrative Assistant). Others Present:Brian Bjorkquist and Mike Mitchell (Department of Law);Eric Lidji (Petroleum News);Steve Pratt (Contractor,APA &ANGDA Consultant);Greta Goto (Co-Man Services);Paul D.Kendall (Public);Christine Vecchio (MEA Ratepayers Alliance). Participating by Teleconference:Steve Haagenson (AEA Executive Director);Herb Hoyt (Public). 4.PUBLIC COMMENTS Verbatim Christine Vecchio:|am with the MEA Ratepayers Alliance in the Matanuska-Susitna Borough. Our organization would like to say that we are very pleased with the direction we see the Alaska Energy Authority going in the sense that it has become,|would say for want of better words,an agency unto itself.That may not be the case,|don't know the details,but I think having an AEA Board Meeting April 10,2008 Meeting Minutes Page 2 Executive Director apart from AIDEA says something about the importance of the issues that we are facing today in Alaska,especially with energy and climate change. Our organization would like to offer our appreciation for the work being done (1)with the REGA Study and (2)for having an Executive Director,such as Mr.Haagenson.Mr.Haagenson has worked with the Interior Issues Council and he knows what it's like to work with divergent opinions and come to some comprehensive vision and implementation of needs of a community.The energy issue facing Alaska now is very critical and a lot of people |know are very concerned,but we also see it as an opportunity to bring in all the different parts of Alaska together.|think that's what it's going to take to come up with an energy policy which |know AEA will be working on that's going to address not only our present energy needs,but from my background it will take care and address the needs of at least seven generations into the future. We would like to offer ourselves,as members of the community,anything we can do to contribute to the process to come up with a comprehensive energy policy.We continue to participate in the REGA Study which |think has set,for us,a precedent of what it is to have public input,ongoing educating as many parts of the community as possible and come up with something that is viable and will be implemented.We thank you for the work that is being done. We offer ourselves,for however we can,for the work ahead.Thank you. Mr.Kendall:Well,gosh you took me by surprise.|usually like to wait and see what unfolds and look at the larger picture before |comment.But I will seize the opportunity,assuming it is a limited one.Which seems to be what our society represents today,that we have a lot of wonderful people who truly exude a degree of confidence and capability and public trust,but they seem to be holding meetings of which seem to be an inside loop and just as this meeting here is today,|can feel the competence and the capabilities,but what |really miss and I|do feel as those 600,000 plus other Alaskans out there,somehow we have to begin to open up the communications.|think it is the greatest wealth that we have is the multitudes that are out there and that you people have been chosen to represent the tipping point of the future.|think that you're missing that and you missed it because,not because you are bad or ill-willed,but simply because nobody's really unfolded you to realize that along with the new age of energy is a new age of communications.We need an Alaska channel to be able to film this and put it on video and send it out to other people as just an instantaneous moment.Here are some emails that |have presented to your distinguished Executive Director Mr.Haagenson and Mr.Harper. My name is Paul D.Kendall.|am a citizen here.My family goes back to Fairbanks in the early 60's |believe it is.Since |was a child |used to hear about Alaska.When |first came up to Fairbanks my family lived in University West.My children went to Woodview Elementary and you know there's an old saying that once Alaska gets in your heart you never forget her.So I've come and gone,but while |was outside |was a bit of an energy activist and a political activist. My family had 14 corporations and!am an entrepreneur.In the meantime,the exposed energy and the volatility and the emotionalism and all those things that are involved in it and some very very tough battles |have now,|bring to the table conclusions,and |think there is something very very very special here in Alaska.|think that you folks are on some type of a cusp,a junction,an intersection,that portends of the next great society and what !|mean by that is,let me,it's so hard because energy is such a large subject |just get overwhelmed with wanting to talk about it all,but |realize you are not here to listen to me you are here to conduct business and |assure you |respect that. AEA Board Meeting _April 10,2008 Meeting Minutes Page 3 |happen to think that the next great society is not going to come from a Messiah or from some intervention from outside or some cataclysmic event.|think the next societies will be energy- based societies.Those societies that understand who owns the energy,who generates it,how you distribute it and transmit it and the priorities of where that goes.Those societies will be the ones who will simply rock,they will rule,they will have their own territories,they will be all unto themselves.The generations who follow after them will be the ones who will benefit in multitudes.The reason |bring this up is that when |look at Alaska,everybody is looking at the gas pipeline.Now |grant you,|understand that the importance of billions of dollars of recurring revenue and the offshoots of that and the dollar circulation.Take me not to be too big of a fool,okay?1!understand the importance of that.|think our Governor iis shackled by the ankles tothatpipeline.But what |see is something much bigger and,I not only see a gasline by ConocoPhillips,|see an Alaska pipeline,|see a China pipeline:'|That China connection is just hugs.ifERgk” multiple energy projects.There isa future to hold in'Alaska that goes equallyin comparison tothatgaspipeline.If you turn internally and look,at your hydroelectric,and your wave and yourtidalandyourcurrent,your geothermal,your.'Coal water,and |brought:you a whole bunch ofpicturesofsomeofthatstuffthat|hope you find,interesting.If you turn|tto that,as well ashydrogen,you will find,ladies and ore than i if youanchor,the energy to your people and your have a multitude of enieray.ateYou'll be able,to switchPee owe,|want to see ten timeswhatevertheenergy.'need is that.you need 'and the:reason.is.this.When you begin to look atenergy's implications'to he°stabilty of a society;to the revenue Soin thatand to the newfuture,it is just incredible al crereoe ayiH ip uyVy4haySo,for you people who are located in Alaskain an isolated terrain,a challenging terrain,whosemothersandfathers:and relatives came here in a sense of freedom and sacrifice and believemetheydidfromthetime|was.'a Child out here.My uncle was talking about the sacrifices uphereandallthosechallenges."It seems to me that your time has come.The fruition is justabundanceafterabundance'and on my first day my first concern was that |just didn't see the leadership.I'm still concerned about some of the leadership,not that they're evil and ill-willed but they just seem to be lacking in being able to be unfolded.Your Juneau connection ladies and gentlemen |have concluded is the most deleterious of all of these things that would hold you back.The implications of a detached government that is absentee from its people are just huge.I run into that.I've been trying to sample the participation and it's a very subtle thing,but |think the people of Juneau are willing to let go and uncaptivate (sic)our leaders and let us get on with a bright future and having said that let me wrap up here. AEA Board Meeting April 10,2008 Meeting Minutes Page 4 You are being too kind to me and |sense that.What you'll notice in here is a whole series of things |hope will invoke thought and demand thought and |stand upon my words and my positions and I'm not afraid to hold myself accountable as either a fool or a folly or unknowing, whatever.But you'll notice in here some things that concern me,like funding for Lihea,PCE, and weatherization.Those are the most foolish things |have seen capital expenditures on since |was a young man.When you look at those expenditures they bring you very very little,if anything.You need to recapture those,capitalize those,activate your people and go out and initiate some energy projects and bring these people all up.But in addition to that,you'll see things that are very interesting.British Petroleum has an agreement in here with GE tomanufacture,to produce up to 15 hydrogen power plants,500 megawatt power plants,over thenextdecade.They are bringing online Carson,California'to tie into waste water,which isfascinating,one in Australia and supposed to have one,'under way in Iceland.But it goes on.They have fueling,hydrogen fueling restations (sic):in,'Beijing;.some other places,Michigan,Florida,Illinois,California.They're also now moving,in heavily to the wind.And this iis on one Peeves isay 3 :Hay, perspectives too.ay? What |would suggest to you is this;you (Nes 'to put somebody in charge of communications.Your future holds something very magnificent,''just huge.But'as it unfolds in some cascadingmanner,some expotential,(sic)manner,'the key to:it IS:going to-be,able to communicate.Youcannotteachpeople.by.'having',to repeat something','over and over again;it just spends yourenergy.The other thing,so communication:is very'important!4;The other thing is you need tohaveanenergysummitrightnow,'before June,the 3.You need to flush out everybody outthere,all sectors and see who's playing,who's "not,who's using how much and you need to getasenseofthe.Scope and the,scale!ofexactly what Alaska's needs are.Do not let that gas o3gad rir ch,ih,nenBh,_Good morning,I wanted,to speak with you very briefly about the proposed SSeges,NE EES established in 1936 and:'has,"continually operated as a remote service center for work andpleasureboatersofsouthernSoutheast.It is located somewhat centrally between Juneau,Sitka,Craig,Klawock,Ketchikan,Wrangell and Petersburg.There is lots of salmon here.I'veseenasmanyas240gillnettersworkingSumnerStraiteastand209trawlerstothewest,a lotofboats.Judy and |are now in our 22™year of operating the trading post andin addition to the vessel fleets,we provide essentials to Point Baker and to Port Protection residents and visitors. We provide fuel to the community building and the floating post office,the only floating US Post Office in the system.We generate electric power 24/7 serving all of the above,as well as AT&T long distance and ACS local telephone utilities.The reason for the request for a bulk fuel upgrade is that our existing fuel tanks are 40-60 years old.They are all single walled,connected by threaded steel piping and they are founded on creosote timber cribbing with no provision for AEA Board Meeting April 10,2008 Meeting Minutes Page 5 containment in the event of a failure.If a spill of any notable volume occurred,the waters at Point Baker,Port Protection,and both arms of Sumner Strait would be affected. In 1998,a team from AEA conducted on-site evaluations and concluded that this facility must be upgraded.They rated it near the top in terms of damage potential in the state.Over time,the appropriate engineering evaluations,economic studies,regulatory reviews,permitting and construction plans and specifications were completed and the plans were released for construction in December 2005.Unfortunately,there were some unanswered concerns about the role the Point Baker community council would fill and what,if any,its liability might be.These concerns have now been resolved. The Council is acutely aware that our area economy,giv 1totallydependentoncommercialandpleasureboaters,and _recreational tourism.Scores ofboatsworkthisareaandwiththespiralingcostof,fuel,'they no longer want to run into the towns pinbagi Salilhe Yee poeta!PE tisghydee 00S BREE and \we have removed the,overburden from the 'site."a lt's ready.for drilling and blasting,sitegradinganderectionofthetanks,piping and.controls.We,.ask for your assistance in bringingthisprojecttofruition.Thank you for the opportunity to provide input and I'll do my best to fieldanyquestionsyoumay.have.ue ee ue nh 1,aahEndVerbatimCommissionervonSchében asked about the!'project cost.Mr.Hoyt replied that the estimatewasoperate$860,000,dollars.including the design engineering and the construction.uy hy Ga i,areh,(Program Mariager)werepresetfo answer questions with respect to the Point Baker project.AyMr.Harper thanked'the Board s the opportunity to discuss Point Baker.AEA has beenworkingwithPointBaker,but,working with Denali Commission funds AEA has to abide by their those.In the past sixix months,AEA feels more comfortable and has sufficient information to move forward with the project. Mr.Winther stated that he visits Point Baker several times each summer and has seen it grow in the past 15 years.He queried Mr.Harper and Mr.Mello about other funding sources available, and what kind of time schedule they were looking at. Mr.Harper stated that AEA uses Denali Commission funding of $10-20 million dollars for the bulk fuel project every year.This is trending down and AEA may be short funds in the future. AEA Board Meeting -April 10,2008 Meeting Minutes Page 6 Throughout the years other funding possibilities have been looked at including federal funds. AEA has utilized a Department of Housing and Urban Development program,which is currently funding a $3 million dollar project in the Naknek-Bethel area.Mr.Mello is working with TAPL funds and AEA has been developing a new funding scheme that might be the source of project funds for this program. Mr.Mello added that construction may begin in the summer of 2009 pending resolution of other issues.The Denali Commission has a private enterprise policy and can't put people into business or take other people out of business who can compete.There is some competitionbetweenPortProtectionandPointBaker,but that is expected to be resolved.AEA is in thedesignphaseinPointBakerandquestionsabouttherelationshipofaprivateentityandthepublicstillneedstobesortedout.In response to Mr.Winther,Mr.Mello stated that a cost of $860,000 is low and is now estimated to be $1.5 mor ;Construction costs have been going up about 1%a'month.There.are also other challenges tobeaddressed.Fuel delivery companies are:not inclined to lighter:into,those communities aseasilyasinthepast.This needs to be addressed to see what potential Is there.There arefad facility. Deputy Commissioner Andrews asked |if waiting for Denali Commission,neaepnyay atMr.Mello stated that"finding matching funds Of,local investments in a project is always anencouragingfactor.'Localrevert ga is alwaysa positive 'factor and helps move a project Are thee other ways of créativemeee moneyso Point Baker can move forward and come up withsomeofaaamoney?!Mr,Mello.stated he will confer with Deputy Commissioner Andrews Electric utilities in the stateare trying to gain an understanding of just what a statewide energy planis,and what do the utilities want.He will assist them to put it into some kind of framework and is really excited to see the AEA Executive Director take on the task of working towards astatewideenergyplan.It's something that other folks have mentioned and is a critical need, especially in rural communities.He said he is here to learn,listen,and is anxious to do whatever he can to interface with Mr.Haagenson and provide support and help to make this work.Mr.Haagenson has an aggressive schedule to accomplish something by the end of year. AEA Board Meeting April 10,2008 Meeting Minutes Page 7 Mr.Kendall asked to comment on the agenda.A lot of these meetings that we have now,once you conclude the public testimony,there really is no participation and rather than raise a hand or distract like that,|just wanted to make sure,because if there is,|happen to think that at the end of these meetings you should perhaps,adjourn,but then in some informal sense,make yourself available to the public for the interaction.What |was looking for was if there was an opportunity that |would hold my questions properly until that time,but if there is not,|don't want to be raising my hand or looking eager to ask a question.Mr.Kendall said he understood that they were here to conduct business,but because you meet so seldom,there's no means ofdisseminationandleaveshimwithoutachancetoParticipate©before adjournment. The minutes were approved as presented. 6.OLD BUSINESS There was no old business. 7.NEW BUSINESS nie7A.AEA Resolutio Ne ;2008-03,Appointment of ABA Executive DirectorabayMr.Bjorkquist provide an ov rview of AEA'Resolution.No '2008-03 for the appointment ofSteveHaagensonas'the AEA Executive Director!”The process of appointing and hiring SteveHaagensonasAEAExecutive|Director is a 'two--step process because the Alaska Energy functions:Of,the 'Alaska Energy.Authority.Under:'the bylaws of AIDEA,there is a two-stepprocess|'for'the hiring of the AEA Executive Director."One provision of the bylawis not includedinthis'appointment and that,is that the bylaw 'also provides that the AEA Board and AIDEABoardcan:jointly designate |certain employees who would fall under the supervision of the AEAExecutiveDirector.After the:AIDEA Board appoints an Executive Director,the two ExecutiveDirectorswillget'together and deal with designating certain employees to be supervised by theAEAExecutiveDirectorversustheAIDEAExecutiveDirector.This is one component that willbedealtwithinthefuture.This Resolution fulfills all of the Alaska Energy Authority Boardrequirementsforthe'appointment.This Board designates who is going to be appointedExecutiveDirector.This:'Board makes a determination that the appointment of an ExecutiveDirectorisnecessaryforperformingAlaskaEnergyAuthorityfunctions.This Board determines compensation.There is also a need for a contract between AEA and AIDEA to deal with cost reimbursement for everything under the contract.The Board has already done many of the things identified here:it has selected an Executive Director,determined compensation,and determined that the appointment is necessary to perform AEA functions.This Resolution ratifies what has been done in the past with respect to that.It authorizes the Executive Director of AEA to meet with the Executive Director of AIDEA and work out that contract relationship. AEA Board Meeting April 10,2008 Meeting Minutes :Page 8 Under Section 4,Sara Fisher-Goad,who has been the Acting Executive Director for the Alaska Energy Authority,will return to her role as a Deputy Director and Assistant Secretary of Alaska Energy Authority.Sections 5 and 6 delegate to the Executive Director signing authority over contracts and also allow the Executive Director to further designate other employees to sign contracts under Section 5.Under Section 6,it authorizes the AEA Executive Director to designate other officers of AEA to act in his place if he is absent.The appointment of Steve Haagenson as Executive Director was effective March 10,2008.Section 7 ratifies all the actions that have been taken both by Steve and Sara,over the last month.They have been working cooperatively together over the past month with one performing certain functions asopposedtotheother.So that there won't be a gap in authority,or,questions of authority,Section7isintendedtoratifyeverythingthatbothofthemhavedor MOTION:Commissioner Galvin moved to approve'Res lution No.2008-03.Seconded byCommissionerNotti.There being no discussi the question was called.A roll call vote fp itsMr.Haagenson reviewed the energy plan presentation stating AEA's goa and mission is toreducethecostofenergyinAlaska''and oH need to do it rapidly.Project results!even though it type 'of energy comes in:solar,gravitational,wind,andHap power.DU can pick all of the energy in theworldfromandasyou,look ina community,ns has been working,with his:'team'!land has,reducedthe number from 31 to 25.The process ofcurrentfuelusage.Is coming 'together really,well.There are some estimates and PCE data usedforestimatingthatnumber,Mr.Haagensonsaid)be was at a convention in Reno and bumped and she said they are a parent company to Delta Yukon and Crowley.She and Steve plan tohaveameeting1nextweekto'discuss quantities of fuel to be delivered where it is needed.It is said they should get a gold §stay beoause they did a great job on it.It is a template to show howwecanpresenttheenergy,se and the costs by sector to figure out energy needs and costs.Technology evaluation basically goes through high level costing,so you understand what the delivery power would cost.Potential technology and fuels is where we get into hydroelectric such as Susitna,Chakachamna,kinetic,hydro.We'll look at wind,both small,large and also maybe a very large turbine.Biomass would include willows,large trees and also creation of power by biomass.The Nome Study is looking at Pilgrim Hot Springs under geothermal which is interesting and could help them a lot.We are looking at bullet lines on natural gas.One option is to put a bullet line out to Donlin Mine in the YK Delta,possibly all the way out to Bethel. This will be evaluated as well as L&G Trucking,gas-to-liquids from natural gas;the ANGDA proposal,a pilot program for propane in the Tanana region;and biogenic gas from peat in the AEA Board Meeting April 10,2008 Meeting Minutes Page 9 Hooper Bay area.We plan to visit the regions and ask them what they know about the region and what resources are available locally.The financial model is a mix of the perfect energy plan and we are using the template to show how to select the least cost options and what they would cost on a fair comparison basis.The option selection is matching the appropriate type of technology to the least cost option.This shouldn't take very long once the template is done.In rapid deployment,we will define new and existing local companies that can provide services. Congress just approved a tax credit extension until the end of 2009 of 1.6 cents per kilowatt hour and also established $1.2B dollars of renewable energy bonds,called credits.The official title is clean renewable energy bonds.We need to see if those.are going to be available at lowcostandcanhaveaccesstopart.The media can have access to part so we 'll see if we can Director.”We were asked to make that available onanSO.'the Governor could link it to herAprilnewsletter.Thank you to Karsten and Terence'for their'assistance.In the letter is acontactpointsoyoucansendanemail.We will 'Use this email''address to collect commentsandideas.We will use the contact information:in order to send''advance notice of visits toregionalareas.AEA staff have volunteered to.work on the team and he expects to be joined byafewAIDEAstaffaswell.A work group structure,using a {linear responsibility chart will leadformationofascope,schedule,and budget.Steve Said.he:'was impressed with the AEA staffandfeelsthereislotofin-house expertise and talent.'The 'schedule is pretty':aggressive,butdoable. We are currently modeling the public meetings'after the AGIA:process.The final communityselectionisunderwayofwhich28communitieswe'aregoing to visit.We will break up into 3-4teamstocompletethat'effort,SOeverybody.doesn't.go to'every meeting.Letters were sent totheutilitiesineacharea'to gather information:about electric'use and date for revenue and costflow.Letters are being''drafted to agencies,identified participants,and communities asking fortheirinputandparticipation,in meetings.Lots.of contacts have been made and Bethel hasyigde bagga!technology,matrix.ef f0,prov nyeeGeyinaeMas'YeCommissioner'von Scheben stated that DOT would like to be includedin this process as energy Chairman Kelsey asked if,Class A community corporations were required to bury tanks,or putthemaboveground,especially those near the waterfront. Mr.Mello stated that AEA has built tank farms in 50 communities and have not come across any underground tanks.The AEA program only deals with above ground storage tanks. Commissioner Galvin acknowledged the progress Steve Haagenson has made.He stated that it is gratifying for the board having hired him and identified him as the person who could move this project ahead and commended his actions and encouraged him to keep going. AEA Board Meeting April 10,2008 Meeting Minutes Page 10 Ms.Fisher-Goad added that in the board packets are AEA programs and projects updates for AEA.She added that it has been an experience and a pleasure working as the AEA Acting Executive Director.She complimented the board with respect to the person they chose as the new Executive Director.She stated that he came in with a lot of energy,no pun intended,with a statewide plan in mind and she looks forward to continuing to work with him to fulfill the planning goal. Ms.Fisher Goad stated the board will be polled for the next AEA Board meeting date. There is an AIDEA Board Meeting scheduled for 1:00pm on,Wed.April 23,2008.Ms.ValorieWalkerstatedthatthismeetingistoconsiderrefundingof.the'existing 2007 refunded bonds toremoveAMBACastheinsurer.This is due to rates that:have gone up as a result of marketturmoilrelatingtotheinsurers,and to put a different,ffancing,iin Place.Board members were Se gay n.,working on a team toayfhenegotiatethatcontract.Deputy Commissioner 'Andrews added that this.is,a problem going onwithfixedincomemarketsthroughouttheentire'United States andis not a Unique problem.It isfyimportanttotakealookatrefinancingthebonds.So tthat 'AIDEA can enioy,cheaper costsassociatedwiththem. 9.BOARD COMMENTS AEA Program Fact Sheets ALASKA ENERGY AUTHORITY Loan Programs Power Project Fund (PPF) Number of loans:,42 Outstanding portfolio balance:$24,986,964 ' Committed &un-disbursed funds:S 562,445 Uncommitted funds:$12,235,378 As of 5/30/08,there was 1 loan past due 90 days or more in the amount of $215,000,which was .86%of the outstanding portfolio balance. Program Background:The PPF program provides loans to local utilities,local governments or independent power producers for the development or upgrade of electric power facilities, including conservation,bulk fuel storage,and waste energy conservation.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.This rate is equal to the percentage that is the average weekly yield of municipal bonds for the 12 months preceding the date of the loan commitment. Bulk Fuel Revolving Loan Fund (BFRLF) Number of loans:42 Outstanding portfolio balance:$1,667,611 Committed &un-disbursed funds:$1,602,900 Uncommitted funds:$6,202,649 As of 5/30/08 there was 1 loan that was past due 90 days or more in the amount of $86,655 or 5.20%of the total portfolio balance. Program Background:The purpose of the BFRLF program is to assist communities,utilities or fuel retailers in small rural communities in purchasing emergency,semi-annual or annual bulk fuel supplies.Loans are for the purchase of new fuel.Loans are not provided for fuel already purchased,in the process of being used or already consumed. Revised 5/08 ALASKA ENERGY AUTHORITY Alternative Energy and Energy Efficiency Program Overview Alaska Energy Authority's (AEA)Alternative Energy and Energy Efficiency (AEEE)program manages and funds 27 projects and initiatives totaling $32.9 million in state and federal funding.An AEEE update is available on AEA's website at www.akenergyauthority.org Program Description The AEEE program promotes the use of renewable resources as alternatives to fossil fuel-based power and heat,and measures to improve energy production and end use efficiency.In rural areas the program may support developing local sources of coal and natural gas as diesel alternatives.The AEEE program is divided into seven separate program areas: , Biomass Energy Program develops projects using wood,sawmill residue,and municipal wastes for energy;tests air emissions and performance of fish oil and diesel blends as fuel;and assesses the viability of recovering fish oil from fish processing wastes. Diesel Generation Efficiency Program provides assistance in developing projects that use high efficiency generators and recover "waste heat”from diesel generators. End Use Efficiency (Conservation)Program has completed 40%of a project upgrading lighting and heating efficiency in over 150 schools and other facilities in 50 villages,is conducting energy audits,and working with Alaska Housing Finance Corporation to develop statewide efficiency policy recommendations and demonstrate impact of aggressive,village-wide measures in Nightmute. Geothermal Program supports projects such as the Chena Hot Springs power plant,organizes workshops and training sessions,and coordinates state assistance in developing other potential projects such as Mt.Spurr on the Railbelt and Makushin in Unalaska via a statewide development plan. Hydroelectric Program provides technical assistance through staff and contractors for hydro feasibility assessment and manages public funding for project construction. Ocean and River Energy Program evaluates technology and feasibility of converting wave motion and tidal and river flow into power in partnership with Alaskan utilities and Electric Power Research Institute. Wind Program assists utilities and communities in resource evaluation,training,environmental assessment, regional development,conceptual design and economic feasibility of rural wind-diesel systems,and Railbelt wind integration studies. Funding AEA's alternative energy program has received funding since the early 1980s from the US Department of Energy (USDOE)and has more recently expanded with funding from the Denali Commission,EPA,and the Legislature through the Renewable Energy Fund ($50 M}.In November 2007 AEA and the Denali Commission released two RFPs offering $9.4 million in alternative energy and efficiency funding.Earlier Energy Cost Reduction RFPs have provided $8.4 million in grant funds to match $12.4 million in local funds for projects that are displacing or will displace 1.4 million gallons per year of diesel and equivalent natural gas.For more detail, see the AEA's Biennial AEEE Assistance Plan at www.akenergyauthority.org Reviewed 5/08 ALASKA ENERGY AUTHORITY Bulk Fuel Program Current Status In 2007,bulk fuel upgrades were completed in the communities of Unalakleet,Seldovia,King Cove,and Pelican.Twelve communities are in the design process. Program Description The goal of Alaska Energy Authority's (AEA)Bulk Fuel program is to upgrade non-compliant bulk fuel facilities in communities that meet criteria.Upgrading bulk fuel facilities reduces the cost of energy by eliminating fuel loss from leaking tanks,spills,and fires.In addition,by providing enough capacity for current and foreseeable future the communities may purchase fuel in larger quantities at a lower cost per gallon. Alaskan remote communities rely on diesel fue!storage for heating and power generation.Many of the bulk fuel storage facilities were constructed in the 1970's or earlier.These facilities are at the end of their design life and do not meet fire code and may leak.Regulatory agencies may prohibit fuel deliveries these facilities.Communities did not have funds for replacing the storage facilities. Since 2000,the Denali Commission has been providing funding to replace community bulk fuel facilities. Due diligence is performed on possible participants to ensure that if they are in debt that they are paying on their loans.Participants sign a Business Operating Plan.The Business Operating Plan lays out the existing fuel facility organizational structure,the qualifications of responsible people,AEA required | training,estimated operation and maintenance costs,and the establishment of a repair and replacement fund,so that when equipment fails,the community will have the knowledge and savings to repair or replace it. Program Progress The bulk fuel program receives most of its funding through the Denali Commission.A total of 21 communities were completed in years previous to 2000.In 2000,funding increased substantially when the Denali Commission started to fund bulk fuel projects.As of December 2007,an additional 62 communities have been completed for a total of 83.Approximately 35 communities have not received upgrades.Depending on funding,five to ten communities are receiving upgrades per year. Reviewed 5/08 ALASKA ENERGY AUTHORITY Circuit Rider Program Current Status we ae The Circuit Rider Program provides technical assistance to help rural utilities with the operation and maintenance of their electrical generation and distribution system.In 2007,31 utilities participated. Program Description The Circuit Rider Program is administered by the Alaska Energy Authority (AEA)and is available to all eligible electric utilities.Electric utilities participating in this program will receive support services available from AEA. The purpose of the circuit rider maintenance program under 3 AAC 108.200 -3 AAC 108.220 is to assist eligible utilities to improve the efficiency,safety,and reliability of power systems and reduce the risk and severity of emergency conditions or emergency disruptions in the operation of community power systems,by providing training,consultation,on-site assistance with maintenance and minor repairs,and other related technical assistance. e The CRM program runs ona fiscal year from July 1 to June 30. e All applications will be evaluated and placed on priority list. e AEA will make one or more visits to eligible electric utilities over the course of the fiscal year to provide training and provide recommendations concerning operations and routine maintenance activities.There will be no charge to the utility for these services. e Participating utilities are responsible for the purchase of all supplies,parts and equipment used for routine maintenance and minor repairs that are made during Circuit Rider visits.These items must be available at the utility's workplace prior to the arrival of AEA staff. e The Circuit Rider program does not provide funding for major repairs or reconstruction of electrical systems. e The participating utility's power plant operator and/or other utility staff must be available for training and consultation during the time of the Circuit Rider staff visit.Power plant operators will be required to maintain written performance logs in between Circuit Rider visits. e Utilities participating in the Circuit Rider program will be required to sign a letter acknowledging their understanding of the terms and conditions of the services provided by the program,prior to the first visit. Program Progress Services under the Circuit Rider program are limited to village electric utilities with a demonstrated need for assistance with preventative operations and maintenance activities,utility training and emergency prevention.The program is not intended to serve electric utilities that have sufficient financial and technical resources to perform routine operations and maintenance activities. Reviewed 5/08 ALASKA ENERGY AUTHORITY Emergency Response Program Current Status In 2007,23 communities where assisted.Major responses included Beaver when their powerhouse burned to the ground and Diomede with unexpected major equipment failures. Program Description The Emergency Response program provides on-call,as-needed emergency action response to mitigate extended power outages and electrical hazards that present eminent threat to life or property. This program is designed to respond to an emergency or potential emergency situation before disaster or major loss occurs.It provides funding for continuance of government activities.It allows for procurement of manpower,materials and equipment for emergency response to electrical generation and distribution system emergencies and disasters in Alaska. Program Progress Emergency response is provided on an as-needed basis only.Well-managed utilities with adequate technical and financial resources are not candidates for these services.Besides helping rural communities,AEA works with State and Federal agencies on an as-needed case by case basis to resolve electrical generation and distribution system emergencies throughout Alaska. Reviewed 5/08 ALASKA ENERGY AUTHORITY Power Cost Equalization Program Current Status The original FYO8 PCE appropriation was $26,760,000.00 which was further capitalized by a $1.2 million dollar supplemental appropriation,increasing the total funding to $27,960,000.00.Current FYO8 budget projections indicate that funding levels should remain at the 100%level for the rest of the fiscal year. During FYO7,87 utilities serving 183 communities participated in the PCE program.The FYO7 PCE appropriation was $25,619,000.00,of which $25,436,750.95 has been disbursed to date.The FYO7 PCE funding levels were 100%for the first six months,and 89%for the second six months.This resulted in an annualized average funding level of 94.5%. Program Description The goal of Alaska Energy Authority's (AEA)Power Cost Equalization program is to provide economic assistance to customers in rural areas of Alaska where the kilowatt-hour charge for electricity can be three to five times higher than the charge in more urban areas of the state.PCE only pays a portion of approximately 30%of all kWh's sold by the participating utilities. PCE fundamentally improves Alaska's standard of living by helping smal!rural areas maintain the availability of communications and the operation of basic infrastructure and systems,including water and sewer,incinerators,heat and light.PCE is a core element underlying the financial viability of centralized power generation in rural communities. The Legislature established different functions for AEA and the Regulatory Commission of Alaska (RCA) under Alaska Statutes 42.45.100-170,which govern PCE program responsibilities. AEA determines eligibility of community facilities and residential customers and authorizes payment to the electric utility.Commercial customers are not eligible to receive PCE credit.Participating utilities are required to reduce each eligible customer's bill by the amount that the State pays for PCE. RCA determines if a utility is eligible to participate in the program and calculates the amount of PCE per kWh payable to the utility.More information about the RCA may be found at www.state.ak.us/rca PCE Endowment Fund The PCE Endowment Fund was created and capitalized in FY 2001 with Funds from the Constitutional Budget Reserve and the Four Dam Pool Project sale proceeds.The PCE Endowment Fund is an Alaska Energy Authority Fund managed by the Department of Revenue;it is invested to earn at least 7%over time.$182.7 million was appropriated to the fund in FY 2007.The deposit occurred in October 2006. AS 42.45.085 provides that 7%of the PCE Endowment Fund's 3 year monthly average market value may be appropriated to the PCE Rural Electric Capitalization Fund for annual PCE program costs.After the FY 2007 capitalization,7%of the market value equals the estimated full funding amount for the program. Reviewed 5/08 ALASKA ENERGY AUTHORITY Rural Power Systems Upgrade Program Current Status Between the calendar years 2000 through 2007,32 communities have benefited from powerhouse and distribution upgrades.15 additional communities are currently undergoing or are scheduled for construction upgrades in 2008.13 more communities are in conceptual design or final design stage. Program Description The Rural Power System Upgrade (RPSU)program concentrates on powerhouse and electrical distribution upgrades.Typical project include powerhouse upgrades or replacements,distribution line assessments and upgrades,line extensions to new customers,demand-side improvements and repairs to generation and distribution systems.Energy efficiency,reliability,safety and sustainability are primary drivers during the conceptual design,final design and construction process.Identification of available alternative energy and interoperability with any existing alternative energy sources is high priority with the rising cost of fue!and carbon emissions concerns. Examples of programmatic efforts include: °Rebuilding or replacement of worn-out,inefficient diesel generator units. °Rebuilding or replacement of old,hazardous and non-code compliant distribution systems. -@ Construction of new power generation systems that meet State and Federal codes. °Inclusion of waste heat recovery systems in new powerhouses. °Force account labor and technical assistance to rural communities through AEA personnel and/or contractors with experience in rural construction. System upgrades to be funded may be identified through a varietyof ways,including via technical assistance,advanced by the local community or directed by the Legislature.The Majority of funds are via the Denali Commission.Other sources include Community Development Block Grant (CDBG),Indian Community Development Block Grant (ICDBG)and Rural Utility Service (RUS). Program Progress Electricity provides for lighting,communications,heat and power necessary to operate infrastructure that supports all other elements needed in any community to permit safe and healthy living conditions. In rural communities throughout Alaska,electricity is generated by a small local "system”(generation and distribution)using diesel fuel at a cost that is three to five times higher than that in urban parts of the state.Of the 200 rural communities,approximately half are served by cooperatives or another form of utility that performs under a well-established organization.Others are served by very small entities, many which experience technical and administrative problems due to lack of economies of scale and/or lack of specialized skills in the community. Reviewed 5/08 ALASKA ENERGY AUTHORITY Training Program Current Status The Alaska Energy Authority (AEA),along with the Denali Commission Training Fund,provides training opportunities to local residents for their energy projects and infrastructure.In FYO7,the AEA Training Program provided training to 131 rural Alaskans.For FY08,the program was funded at $416,435 and at least 118 rural Alaskans are expected to be trained. Program Description The intent of this training is to ensure that community personnel have the best skills with which to sustain their energy infrastructure in a business-like manner.With proper training,utilities can keep their facilities code-compliant and sustainable. The training program currently offers the following courses: e Bulk Fuel Operator Training e =|tinerant Bulk Fuel Operator Training e Bulk Fuel Business Training e Power Plant Operator Training e -Advanced Power Plant Operator Training e Electric Utility Business Training e =PCE Utility Clerk Training | In the past,Hydro Power Plant Training was offered.It was decided that it is sufficient to conduct this training every two years.Therefore,funding for Hydro Power Plant Training will be requested in FY09. Reviewed 5/08 AEA Project Fact Sheets /=ALASKAeeeEtonASaK)ENERGY AUTHORITYokxAlaskaIndustrialDevelopmentandExportAuthority Revised June 3 2008 Project Fact Sheet:ALASKA-BC INTERTIE STUDY CURRENT STATUS:A portion of the AKBC funds have been re-appropriated for the design and permitting of the Petersburg-to-Kake Intertie project.Some funds have been retained to monitor the situation in British Columbia,where the government is re-evaluating whether to build the backbone intertie from southern BC to 60 miles from the Alaska-BC border.Further action on the export project depends in part on the evaluation by private mining companies of the economics of major mines near the Alaska-BC border.The final feasibility report has been published.It is available online at http:/Avww.akenergyauthority.org/AKBCProjectPage.html After July 1,2008 AEA will begin the final route selection,design and permitting process for the Petersburg to Kake Intertie.AEA is presently discussing an integrated corridor development concept with DOT-PF,to build a joint road/intertie project.AEA will be attending a public meeting in Petersburg in late June to begin the process of finalizing routing and to discuss the integrated corridor development concept. PROJECT COST:$3.2 million. DESCRIPTION:To analyze and confirm the feasibility of a transmission line that would connect two parts of the Four Dam Pool service area and the two major Southeast hydroelectric power plants in the Ketchikan-Wrangell-Petersburg region through construction of a 67-mile electrical transmission intertie;and connect the Four Dam Pool transmission system into the Canadian grid,and thus gain access to power markets either in Canada or US Pacific Northwest.As a part of the study,examine the construction of a transmission backbone that that would entice private or local government entities to develop hydro power projects that could produce as much as 100 MW of power for use in southern SE Alaska or be exported. PURPOSE:Provide a transmission system to allow for exportation of power to the British Columbia grid.Additional intertie will allow delivery of excess power for Lake Tyee to Ketchikan. SOURCE OF FUNDS:Legislative appropriation of $3.2 million.Of the $3.2M funding,AEA has expended approximately $511,000 as of September 30,2007. PARTICIPANTS:Hatch Energy (Contractor)and an Advisory Work Group made up of representatives from Southeast Alaska communities including:Auke Bay,Craig,Juneau, Ketchikan,Metlakatla,Petersburg,and Wrangell. BENEFITS:The draft final report supports the Swan-Tyee Intertie and the Kake Petersburg Interties as being economically feasible,and indicates the export intertie link shows economic promise,but cannot be definitively determined at this time. ADDITIONAL BACKGROUND:This study has an advisory committee and steering committee to assist AEA in proper administration of funds.The committees have participated actively in the formulation of the consultant scope of work,selection of the consultant.The feasibility study has been reviewed and approved by the work group. 813 West Northern Lights Boulevard «Anchorage,Alaska 99503-2495 www.aidea.org e 907/771-3000 «FAX 907/771-3044 e Toll Free (Alaska Only)888/300-8534 @ www.akenergyauthority.org [=ALASKAENERGYAUTHORITYAlaskaIndustrialDevelopment and Export Authority Reviewed June 3 2008 Project Fact Sheet:ALASKA INTERTIE CURRENT STATUS:The Intertie is currently in operation.Several repair and renovation projects are before the Intertie Operating Committee and AEA,and have recently been funded by capital appropriations.The projects are the STATIC VAR COMPENSATOR replacement project and the TOWER 195 RELOCATION project.Governor Palin recently approved the re-appropriation of $10M of Teeland-Douglas Intertie Upgrade funds to replace aging Static VAR compensators for the Intertie at three locations and to repair a tower foundation. PROJECT COST:Initial capitals costs of $124 million.Warranty and repair and replacement fund is paid into by utilities to cover costs. DESCRIPTION:The Alaska Intertie transmission line is a 170-mile long,345kV transmission line between Willow and Healy that is owned by AEA.It is presently operated at 138 KV. PURPOSE:The purpose of the Alaska Intertie is to interconnect Golden Valley Electric Association, the regulated utility that serves areas north of the Alaska Range with south central Alaska Utilities.The intertie also allows resources north and south of the range to be shared to improve reliability.Notably, the GVEA storage battery,as well as GVEA generation resources,can and have been used to send emergency power southward to minimize catastrophic network wide outages.The operation of this intertie materially improves overall system reliability. SOURCE OF FUNDS:The Intertie was built in the mid-1980s with State of Alaska appropriations totaling $124 million.Currently,there is no debt associated with this asset. PARTICIPANTS:The operation of the Intertie is governed by the Alaska Intertie Agreement entered into in 1985 and amended in 1991.The parties to this agreement are AEA (formerly Alaska Power Authority),Anchorage Municipal Light &Power,Chugach Electric Association Inc.,Alaska Municipal Utilities System,Golden Valley Electric Association,Inc.,and the Alaska Electric Generation and . Transmission Cooperative (AEG&T is comprised of Matanuska Electric Association and Homer Electric Association). BENEFITS:In 1981,a study demonstrated a positive feasibility of the line and recommended construction of an intertie to allow exchange of economy energy and the sharing of reserve generation capacity between the Anchorage and Fairbanks load centers.It was estimated that the benefits from the project would be approximately $17 million per year. ADDITIONAL BACKGROUND:Agreements have been developed over a span of 30 years to govern . the cooperative management,operation of the connected network at large.AEA has agreements with participating utilities that assure the Alaska Intertie operates with prudent maintenance and operation by utilities.ML&P is the intertie operator,while MEA and GVEA provide maintenance and operations services. AEA serves as financial administrator,providing basic accounting services to establish a cost-based wheeling rate that is trued up each year.AEA collects payments from Intertie users and pays expenses,including reimbursement of costs incurred by the two operators of the line,ML&P and GVEA, and the three maintenance contractors,MEA,CEA,and GVEA. 813 West Northern Lights Boulevard «Anchorage,Alaska 99503-2495 www.aidea.org e 907/771-3000 «FAX 907/771-3044 e Toll Free (Alaska Only)888/300-8534 e www.akenergyauthority.org ALASKA qa)ENERGY AUTHORITYraenthAlaskaIndustrialDevelopmentandExportAuthority Reviewed:May 29,2008 Project Fact Sheet:BRADLEY LAKE HYDROELECTRIC PROJECT CURRENT STATUS:Inspections indicate Bradley is in good condition.In 2006,the governor control system was replaced.Bradley's responsiveness to changes in output improved greatly. In 2007,the turbine runners were replaced.No major projects are planned for 2008.Bradley continues to perform well and maintenance activities are proceeding as planned. PROJECT COST:$317 million (original cost plus major capital improvements through June 30, 2007) DESCRIPTION:The project has 126 MW of installed capacity hydroelectric project located 27 air miles southeast of Homer on the Kenai Peninsula.The project consists of Bradley Lake,a 125 foot high concrete faced,rock filled dam structure,three diversion structures,a 19,063 ft. long power tunnel and vertical shaft,generating plant,interior substation,20 miles of transmission line,and substation.Due to its remote location,the project has its own airstrip, boat dock,residential quarters,and utility system.The project is normally automatically operated by remote dispatch by Chugach Electric Association from Anchorage. PURPOSE:The Bradley project provides 5-10%of the annual railbelt electric power needs at the lowest generation cost.Bradley is most important to the railbelt electric system during the cold winter months.Demand for both electric power and gas for heat is at its highest.Utilities limited by available gas are able to use Bradley power to meet the high electric demand. SOURCE OF FUNDS:Legislative appropriations and AEA revenue bonds repaid by participating utilities. PARTICIPANTS:Under the Power Sales Agreement,100%of the project's capacity has been sold to the power purchasers:Chugach Electric Association,Inc.(30.4%);Municipality of Anchorage (25.9%);Alaska Electric Generation &Transmission Cooperative,Inc.(25.8%); acting on behalf of Homer Electric Association,Inc.(12.0%)and Matanuska Electric Association, Inc.(13.8%);Golden Valley Electric Association,Inc.(16.9%);and City of Seward (1.0%) BENEFITS:Authority ownership now assures the railbelt area of a long-term source of power at a stable cost and promotes economic development in the region. ADDITIONAL BACKGROUND:The power generation potential of Bradley Lake was first studied by the U.S.Corps of Engineers and presented in a report dated March 1955.The project was authorized by Congress in 1962,but,despite its feasibility,federal funds were not available for its construction.The Alaska Energy Authority (then Alaska Power Authority)assumed responsibility for the project in 1982.Preliminary plans and field investigations started in 1982. In April 1984,the Authority submitted an application for license to the Federal Energy Regulatory Commission (FERC).The license to construct the project was issued on December 31,1985.In December 1987,the Authority and the railbelt utilities entered into a Power Sales Agreement to 813 West Northern Lights Boulevard «Anchorage,Alaska 99503-2495 www.aidea.org «907/771-3000 e FAX 907/771-3044 «Toll Free (Alaska Only)888/300-8534 #www.akenergyauthority.org Bradley Hydroelectric Project Project Fact Sheet Page 2 of2 delineate responsibilities.Project was declared in commercial operation September 1,1991. Bradley has been producing power for 16 years.In 2007,Bradley produced 392,000 MWh of power at a cost of approximately $.039 per kWh. A Bradley Project Management Committee (BPMC)was formed in 1993 with representatives from each of the power purchasers and Alaska Energy Authority.The BPMC is responsible for the management,operation,maintenance,and improvement of the project,subject to the non- delegable duties of the Alaska Energy Authority. /=ALASKA2)ENERGY AUTHORITY aska Industrial DevelopmentdExportAuthority Os Al an Reviewed June 3,2008 Project Fact Sheet:EKLUTNA TRANSMISSION LINE UPGRADE CURRENT STATUS:Project construction is complete.The line presently awaits connection into the Railbelt network.As the available funds through the AEA grant are nearly exhausted, the Eklutna Operating Committee (ML&P,Chugach and MEA)has elected to complete the project using funds they will secure.The Operating Committee has designated ML&P as the project manager for completing terminations,commissioning and energizing the line.ML&P is securing professional services to accomplish this commissioning process.They will be reporting the proposed schedule to AEA for commissioning in the spring of 2008. PROJECT COST:$19.3 million DESCRIPTION:The project consists of rebuilding the existing 115kV wood-pole electric transmission line from the Eklutna Hydroelectric Plant to the point where the Beluga 230kV electric transmission line intersects the line (near Briggs Tap/Fossil Creek),spanning a distance of 22.5 miles. PURPOSE:To upgrade the existing single circuit line to a double circuit line providing an overall capacity and reliability to the intertie.To improve system reliability and resolve fault issues,the generating utilities approached the legislature for funding to construct a dedicated transmission link between the two generation centers,and to provide a second line to serve the four existing MEA taps.The new transmission line will be constructed and insulated for 230KV, but will initially operated at 138KV. SOURCE OF FUNDS:Grant to the Municipality of Anchorage Municipal Light and Power through the Alaska Energy Authority for an Eklutna project transmission line upgrade.AEA is the grant administrator. PARTICIPANTS:Anchorage Municipal Light and Power,Chugach Electric Association,Inc., and Matanuska Electric Association. BENEFITS:This intertie project will resolve concerns over the 50-year age of a wood structured primary intertie link between the hydroelectric power plant at Eklutna,and the ML&P plant no.2,which is one of the main generation centers for South Central Alaska.Completion of the intertie will increase operating and dispatch flexibility for South Central Alaska,and increase reliability of power supply. ADDITIONAL BACKGROUND:Concerns for system reliability and safety led South Central Utilities to approach the legislature for a $19.3 Million appropriation to replace a 50-year-old key transmission link between two South Central Generation facilities.The Eklutna hydropower generation facility,recently repowered to produce 40MW of storage hydropower,was connected to the rest of the Railbelt system through the wood structured link. 813 West Northern Lights Boulevard e Anchorage,Alaska 99503-2495 www.aidea.org e 907/771-3000 e FAX 907/771-3044 e Toll Free (Alaska Only)888/300-8534 «www.akenergyauthority.org wok yep Can axe ake Alaska Industrial DevelopmentandExportAuthority /=ALASKAENERGYAUTHORITY Revised May 29,2008 Project Fact Sheet:LARSEN BAY HYDROELECTRIC PROJECT CURRENT STATUS:Upgrades to the Larsen Bay Hydro Facility are in progress. Replacement of the switchgear controls and repairs to the intake structure is scheduled for Fall 2008. PROJECT COST:$320,000 DESCRIPTION:The Larsen Bay hydro facility has experienced many operating problems over the last few years.The problems are mainly related to the aging of the control switchgear, much of which was installed twenty years ago.Improvements that will be made to the hydroelectric facilities to improve operational reliability will include the replacement of the hydro switchgear controls with new load-sending,data acquisition and remote monitoring capabilities. Additionally ice flow damage to the water intake structure will be repaired.Operationally a portion of the cannery domestic load will be isolated in order to facilitate increased use of hydro power during the summer without impacting the power to the city. PURPOSE:The project intent is to increase the reliability,power quality and efficiency of the hydro system at Larsen Bay. SOURCE OF FUNDS:In 2004,the City of Larsen Bay applied for and received a CDBG Grant to upgrade the hydro facility.In 2005,AEA negotiated a Grant Agreement with the City of Larsen Bay and CDBG to manage the hydro upgrade project.Subsequently,the project was awarded $320,000 from CDBG. PARTICIPANTS:Alaska Energy Authority and the City of Larsen Bay BENEFITS:When operating efficiently the hydro can displace 90%of the communities diesel fuel used for electrical generation.Sales to the cannery during the summer of 2007 allowed the City of Larsen Bay to pay its loan obligations for FY 2007 and 2008.The intent is to turn the facility over to the City after the improvements have been made and the facility has proven its reliability ADDITIONAL BACKGROUND:This 475-kilowatt project went into commercial operation in mid-1991 with construction costs of approximately $1.6 million.In addition to producing electricity for this isolated Kodiak Island community,the project replaced the City of Larsen Bay's old water supply system and provides a better source of water with reduced maintenance and improved water quality.The original intent of the hydro project was to turn the facility over to the City of Larsen Bay once it had been demonstrated to be operationally viable over a few years.The hydro operated only intermittently and unreliably for many years;therefore the community would not agree to accept the facility until these problems were worked out.In 2004,the City of Larsen Bay agreed to seek CDBG funding to make improvements to the hydro facility. 813 West Northern Lights Boulevard*Anchorage,Alaska 99503-2495waww.aidea.org *907/269-3000 *FAX 907/269-3044*Toll Free (Alaska Only)888/300-8534 *www.akenergyauthority.org /=ALASKAHeLcegebz@=_)ENERGY AUTHORITY Alas!a Industrial DevelopmentandExportAuthority Revised June 3,2008 Project Fact Sheet:RAILBELT ELECTRICAL GRID AUTHORITY STUDY CURRENT STATUS:The Consultant,Black and Veatch (B&V),has nearly completed analysis work,and is due to deliver initial drafts of the report for early review by the project manager.Meetings are scheduled with Railbelt general managers and data masters to confirm correct inputs and review analysis results.The firm Birch Horton Bittner and Cherot was hired to provide tax and legal consultation on Grid Authority business structures.AEA hosted the third Advisory Work Group Meeting on May 14,2008.A second technical conference is to be held in early July 2008 to present the results of the study.Current project completion is expected to be August 2008. PROJECT COST:$800,000 DESCRIPTION:Black and Veatch (B&V)was hired as consultant to AEA to perform the analysis of the potential of a Railbelt Electrical Grid Authority in increasing cost effectiveness and reliability in the operation of the Railbelt transmission grid.B&V will analyze operation costs,look at current and future generation sources,look at current and future electrical demands and develop a series of future scenarios with recommendations for a grid authority. This work will be done in conjunction with the Railbelt utilities,through extensive interviews with affected stakeholders and subject matter experts and with the guidance and feedback of an advisory work group. PURPOSE:This Railbelt Electrical Grid Authority (REGA)study will identify a range of grid authority business structures to own,operate,control,maintain and operate the future Railbelt Electrical generation and transmission Grid This business structure alternatives could range from a voluntary organization to dispatch power and manage the grid assets,or it could be more encompassing to include responsibility for planning and acquiring new generation and assuming ownership of existing Railbelt assets. SOURCE OF FUNDS:Legislative appropriation. PARTICIPANTS:Black and Veatch;Alaska Energy Authority;Homer Electric Association; Chugach Electric Association;Anchorage Municipal Light and Power;Matanuska Electric Association;Golden Valley Electric Association;and a variety of stakeholders as represented on the advisory group and through interviews. BENEFITS:The project will provide the range of effective business structures that the Railbelt can employ to manage the future generation and transmission assets,with comparative economic assessments,analysis of barriers to implementation,and an implementation plan. This will provide a basis for any decisions relating to the enhancement and growth of Railbelt Electric Infrastructure under a variety of possible future energy supplies. ADDITIONAL BACKGROUND:A recent petition by MEA to the Regulatory Commission of Alaska called for the creation of a regional Generation and Transmission Cooperative as a means to implement a collective process to secure new generation sources for the Railbelt. This matter is currently being considered by the RCA. 813 West Northern Lights Boulevard e Anchorage,Alaska 99503-2495 www.aidea.org «907/771-3000 «FAX 907/771-3044 @ Toll Free (Alaska Only)888/300-8534 e www.akenergyauthority.org f=ALASKAENERGYAUTHORITakeAlaskaIndustrialDevelopment and Export Authority Revised June 3,2008 Project Fact Sheet:SWAN-TYEE INTERTIE CONSTRUCTION COMPLETION CURRENT STATUS:The project has been mobilized and line clearing is underway. Remaining portions of the intertie towers are under order.Foundation construction is underway. PROJECT COST:$46.2 million DESCRIPTION:This project will complete the construction of the 57-mile Swan-Tyee Intertie between the Swan Lake hydro-electric power plant and the Tyee Lake hydro-electric power plant,and when energized will allow the communities of Petersburg,Wrangell,and Ketchikan to be electrically interconnected.The work will be completed in the 2008 and 2009 construction seasons.The intertie will be owned and operated by The Four Dam Pool Power Agency. PURPOSE:This project will allow power that is produced in the Four Dam Pool transmission network to be scheduled and economically dispatched.Initially,it is expected that excess water energy available at Lake Tyee generation capacity and energy will be used to offset an energy shortage in the Ketchikan area.In a longer range capacity,the intertie can be used to convey power for export through an export intertie that is being considered into British Columbia. SOURCE OF FUNDS:Grant to the Four Dam Pool Power Agency PARTICIPANTS:The Four Dam Pool Power Agency consisting of three purchasing utilities (municipal utilities of the Cities of Ketchikan,Wrangell and Petersburg)and two electric cooperatives (Copper Valley Electric Association and Kodiak Electric Association). BENEFITS:Generation,avoiding a looming shortage in Ketchikan that could have required Ketchikan Public Utilities to operate expensive and polluting diesel generation. ADDITIONAL BACKGROUND:This project was partially funded in 2005.The Four Dam Pool Power Agency cleared the Right-of-Way and purchased and installed tower foundations, construction was stopped when these funds were expended.The region was able to secure an appropriation of $46.2 million for completion of the project. 813 West Northern Lights Boulevarde Anchorage,Alaska 99503-2495www.aidea.org e 907/771-3000#FAX 907/771-3044 Toll Free (Alaska Only)888/300-8534 «www.akenergyauthority.org ALASKAike”Eom €@_D ENERGY AUTHORITYaxekdAlaskaIndustrialDevelopmentandExportAuthority Revised June 3,2008 Project Fact Sheet:TEELAND DOUGLAS TRANSMISSION LINE PROJECT CURRENT STATUS:Project meetings continue.The ML&P team is midway in outreach and public meetings.Meetings have been held with the Matanuska Susitna Borough,the City of Houston and a number of community councils.A portion of the funds for this project ($10M)were re-appropriated to repair Static VAR compensators and a tower with foundation difficulties during this legislative session.. PROJECT COST:$20.3 million DESCRIPTION:Upgrade and extend the line from the Teeland Substation on Knik-Goose Bay Road to the Douglas substation in the Matanuska-Susitna Borough.The project is an integral part of the Alaska Intertie and will replace approximately 25 miles of an existing transmission line operated at 138kV,owned by MEA. PURPOSE:Construction of this bypass line will parallel the existing MEA owned line,and allow the present MEA owned intertie link,20 miles of which is insulated at 115kV and operated at . 138kV,to return to MEA control and service.Continued use of this 20-mile portion of the 25-mile MEA asset by certain Railbelt utilities until January 1,2014 has been provided for through an RCA order. SOURCE OF FUNDS:2002 Legislative appropriation to AEA. PARTICIPANTS:AEA is contracting with Municipal Light and Power under a cooperative agreement to accomplish the transmission line project.AEA will own the new line and it will become part of the Alaska Intertie Project. BENEFITS:This new line will be an addition to the existing 170 mile Alaska Intertie.With AEA ownership and access,the existing agreements with MEA for use of MEA transmission lines,which are complex,will no longer be needed.It is expected that intertie operations will be simplified,and MEA will gain the full use of its assets it previously had devoted to intertie operation. ADDITIONAL BACKGROUND:It was determined that the most effective way to construct the line was to have ML&P manage all construction activities.This decision was the result of a collaborative effort between AEA and the Intertie participant utilities.The project has been approved by the Intertie Operating Committee. 813 West Northern Lights Boulevard e Anchorage,Alaska 99503-2495 www.aidea.org ¢907/771-3000 »FAX 907/771-3044 e Toll Free (Alaska Only)888/300-8534 «www.akenergyauthority.org 2008 Alaska Energy Authority Initiatives 2008 Alasna energy Authority Initiatives NOV ALASKA ENERGY PLAN 1 |Develop The Alaska Energy Plan[Determine energy use by Community-Prelim | Town Hall Meetings oo ot.Form Technology Teams _oo Technology DaysTechnologyEvaluation and Cost Estimates __ _|Determine energy use by Community-Final_ Technology Selection and Recommendation -__ Town Hall Mtgs/Community Feedback | Business Development Training |Legislative Focus on Energy Projects13|Deployment-Public/Private Partnerships | -| HB 152 Task Force ...[ | | I ENERGY RELIEF PLAN Concept Development /SWOT__ Press Release -an Concept Review/Modification due to comments | Draft Statutory Wording\Concept Revision with Stakeholders/Legislators_ |Special SessionImplementationof Energy Relief Plan -©NoobwhoTransition Plan:Immediate-short-mid-long_ ranean BUDGET-Energy Projects1{Governor Approval2|NegotiateTransfer Agreements w/Named Recipients |_ 2 Manage Grant Agreements for compliance ----...-. || | 152-Renewable Energy Projects _!Governor Approval_ Draft RegulationsCommentPeriod on Draft Regulations Refine the RFP Process Form Advisory CommitteeDeveloptheProgramRFP__ Request Proposals through the RFP) Evaluate ProposalsSeeLBOReviewofSelection for the first Year 10 |Award Projects 1 12 13 14 |Legislative Selection of Projects _ NegotiateGrant AgreementsManageGrantAgreementsfor compliance_Legislative Review of Selection for subsequent years _oda 15 [Award Projects16\Negotiate Grant Agreements__a17iManageGrantAgreementsforcompliance__- 2008 Alasna nergy Authority Initiatives Py 1 coe HYDROELECTRIC EVALUATION_1_|Governor Approval oe'Feasibility Study and Cost Estimate oi.Integrated Systems Energy Plan for the 'Railbelt ao Determine Financing Options |Determine cost of Power for Selectected Alternatives |jEnvironmental/Socio-economic !mpact Study \-:|Field Work-limitedi -ee ee Denali Commission Grants Approved Negotiate Grant AgreementsManageGrantAgreementsfor compliance_ 2 3 4 RURAL BULK FUEL CASH FLOW |ee {Letter from AVEC 85%increase in Fuel Costs {Brainstorm Solutions'Review PPF,Bulk Fuel,Line-of-Credit options_ 1 2 3"4[Determine State Level of Support - COMMISSION GRANT ADMINISTRATION eesLEGEND: _OnInschedule,within costs,meeting quality.ee _Caution-there are areas of concern that must be resolved for successful completion._|Alert-This activity will need major attention for successful completion. _Not Completed __Completed Completion Milestone____|Intermidiate Milestone ee Activity with specific time SRAaAlaska Energy Plan Alaska Energy Authority s Ee Bn_Audience Participation is your estimate of the total yearly energy ;per household,for electric,space heating portation,in each of the followingran e Southeast ©Rural o Reduce the cost of energy to Alaska ©Rapidly identify and deploy solutions -Deple USSRitchtinal,Bere6 Complete analysis by December 2008 y solutions as soon as identified. -eldentify and deploy energy sources that are vertically integrated, nomic,long-term stable priced, d sustainable. a Reegaeaer ms -e Provide energy in a form that can be used in existing infrastructure. _e Evaluate costs on a delivered basis.)Use low-profit business structure.|Z-)Minimize risk of technology failure.:"Engage Alaskans in the solution.Seek the lowest cost energy to eachcommunity. sgSERIAA2ssnt3WmiAYO!¥%eb 3.7 Tides 3.5 Ocean Tides 0.0005 Solid Earth Tides Tidal EnergyTerrestrialEn r0.2 Geothermal Energy SME 0.06 wind Energy »60 Waves 870 Wind oy Wave --"#\Energy Ocean Thermal Gradient ony 300 0.36 Hydro- electricity 7.2 5.490 Clouds Methane Hydrate 200 Z)« ad Pe ee ee OE LO Rivers 360000 Z3 fSeawateroF,:ase 502ZJ Gas PB 32 Crustal ThermalEnergy1.5€7 Z)Thermal Kinetic ChemicalGravitational -y Human Use for Energy ServicesJNaturalExergyDestruction <>Exergy Accumulation [2]](=102!3) Exergy Flux [TW](=1022 w) Exergy is the useful portion of energy that allows us to do work and perform energy services.We gather exergy from energy-carrying substances in the naturalworldwecallenergyresources.While energy is conserved,the exergetic portion can be destroyed when it undergoes an energy conversion.This diagram summarizes the exergy reservoirs and flows in our sphere of influence including their interconnections,conversions,and eventual natural or anthropogenicdestruction.Because the choice of energy resource and the method of resource utilization have environmental consequences,knowing the full range of energyoptionsavailabletoourgrowingworldpopulationandeconomymayassistineffortstodecoupleenergyusefromenvironmentaldamage. Prepared by Wes Hermann and A.J.Simon Global Climate and Energy Project at Stanford University (http://gcep.stanford.edu)var.1.1 ©GCEP 2005,2 Regions-Regional Educational Attendance Areas Anchorage:June 4 Aniak:May 7 Barrow June 2 Bethel May 6 . | Craig May 29 Sates pa orn mg mmgge™Dillingham May 15 er aeFairbanksApril30men Ft Yukon Galena Tat ae vw +ee co cn "et . weg ': 'aod Sere BAAaheron.ae mace 2 came aw*ge la e ."ase M y ]cae *yo :eae "asaayegDeLOseBowieem . ae a ee :ot etre +ree :te.,pe Me BD cing pee Piet PEERaORTEPOTTAkeescae'ta nak .teenaenunewareneetIhrenoonesaeteeaetweeOgwweETeefstherwoeREGSvevbedevasveeeesberan:OA eee RISA tie bee mw geJuneauMay27neeesmes .es PAST Wh Ane .ae t veENngLedntonBRR*eso peg taser eva See eee :rea rrforetarweva.a 3 Ag ays oe ee a . . .ot er)re,Pee reaintaoeCeetcnikanaydeupheactPaginnéB23;a Te bob ye i ichib aoKodiak=May 22 oR,*rbstedtoberten EL ab 26 weeg deo ON a nek Hewes my PE i .- we Peres Kotzebue McGrath Naknek Nome Palmer Sand Point Soldotna Tok |Unalaska Valdez _ Wrangell”. am vagy BE St May 8 May 14 May 14 May 8 April 28 May 20 April 29 May 1 May 20 May 12 May 28 «=.ALASwehsaceeSe Ca & &x Leipenyaitial Usage estimates 'Bulk Fuel Loan data 5Tank Sizing estimate:1,000 gallons per ear per person.StihlCE participation NEBRCrowley and Yukon Western deliveries Selawik-Energy Flow Model :(SNOSILOC ULL: Base per household 240,831 gallons Petroleum $2,500 109,157kWh Wind Electric $6,500 $2? $9,000 Yearly Total 327,000 gallons -Petroleum s ;ae Space Heating Community Facilities sasDadarenePEELSeDSTIREPRENENleum Transportation Commercial Regional Energy Cost pee©Anchorage(gas)Electric $-1-417- _Heating $834 Transport $3,474 Total Energy $5,425!%of Income 9.8 % .Fairbanks (Diesel)Electric $1,534 _Heating $4,027 -Transport $3,521 Total Energy $9,082enIncome22.4 % $2,881 $1,832 Heating Transport Total Energy $5,972 %of Income 13.8 % o Rural (Diesel) Electric $1,753 Heating $6,596 Transport $1,941 Total Energy $10,291 %of Income 40.2 % Potential Techn Natural Gas Propane Coal Diesel Coal Bed Methane Nuclear Hydroelectric Wind 'Solar 'Tidal'Wave 'Biomass ,Geothermal Municipal Waste Conservation©0686ooGasification Fischer-Tropsch©0060600000 psigenmargins:stimates | )perations and Maintenance Costs -Locally Availab |:at Niels to 25 communities to listen to_locals on available energy sources.x)Size for the local need°Determine energy delivery method.°Develop energy production and_delivery method and costs.;oe Control using Local Fuels to _Financial Model-Template Municipal Waste |Coal:$1.92/mmBTU |” Biomass:$4.17/mmBTU Fuel Sources -|Gasification Fischer-Tropsch $14.29/mmBTU $1.86/gallon f Y.$6:25/mmBTU Combustion Gas Turbine Natural Gas $9.00/mmBTU Diesel $22.92/mmBTU Tidal Solar $204.25/mmBTU Direct Combustion-CHP $18.56/mmBTU Wind $24.61/mnmBTU Geothermal $17.10/mmBTU Hydroelectric:$16.36/mmBTU Conservation/efficiency improvements $(5.93)/mmBTU excerpt.rom the Fairbanks Energy.Pla Electric kWhy? $0.072/kWh $0.6971/kWh $0.0633/kWh $0.0840/kWh $0.0584/kWh ww $0.0558/kWh Kg ($0.0203)/kWh akg EDC Website www.investfairbanks.cor 4eeS ww£2oO cot3= Qa5...Oo=®>ofOo).2O+»og©Oo f) <« -Td523}om£9=o=iS=>Oc=0 - =os = wadSeYf2ogo=OOSEOo Saemceeo Identify new or existing local companies _that can provide deployment or support. .YS)Support Power Sales agreements whereappropriate E;Identify and develop financial institution-relationships Stakeholders.mes :: a e Local Input *Elders ¢Thought Leaders The passionate ao -Native EntitiesonrsNewsMedia|0 Utilities Electric:Trans|portation o State of Alaska ¢Governor's office ¢Legislature ¢AEA ¢DNR ¢DEC ¢DCCED ¢RCA ¢AHFC _@ Engage both public and private sectors in identifying a solution __.._-AEA Team and passionate Alaskans -Local Businesses ntrepreneurial Business training -Financial Institutions -State of Alaska financial supportsSisotonshaoii Mar Apr May Jun July Sep Oct Nov Dec ©Identifying local fuel needs and resources o ean technology Questions 22? Contact Information: Alaska Energy Authority 4 813 W Northern Lights Blvd. oe od Anchorage,Alaska 99503 -e :(907)771-3073 i:w.akenergyauthority.org mment e-mails to: Steve Haagenson 'rom:Steve Haagenson ent:Monday,May 26,2008 12:02 PM Vo:Bruce Tiedeman;Chris Mello;Christa Caldwell;David Lockard;Douglas Ott;James Hemsath; James Jensen;James Strandberg;Karsten Rodvik;Kris Noonan;Luc Mehl;Martina Dabo; Mike Harper;Monica Moore;Peter Crimp;Rebecca Garrett;Ronald Brown;Steve Haagenson;Terri Harper Subject:Message to the Chairs of the workgroups of the I2C Cost of Energy Taskforce Attachments:Fairbanks Energy Business Plan 11-07.doc Thank you for your "can-do"attitude on reducing the cost of energy through the deployment of technology and energy resources in Alaska. We currently have twelve technology work group areas to be evaluated. Hydroelectric:Chair Doug Ott Biomass:Chair Ron Brown Gasification/FT:Chair James Jensen Geothermal:Chair Dave Lockhart Tidal/Wave:Chair Dave Lockhart Natural Gases:Chair Mike Harper Wind:Chair Martina Dabo Solar:Chair Luc Mehl Waste-to-Energy:Chair Peter Crimp Coal/Nuclear:Chair Mike Harper Conservation:Chair Rebecca Garrett Chair Kris NoonanDieselEfficiency: is you form your workgroups,keep your eyes open for co-workers,peers,neighbors,or anyone you hear talking with an positive interest in energy.Look for diversity and encourage discussions to find a better solution.We should also consider using consultants or energy groups who can focus efforts or bring expertise in technical areas. Please see me if you are considering adding a compensated addition to your workgroup. Let me share how I view the next steps as we ultimately develop our business plan for each community.The most preferable result will be a combination of fuels and technologies that will resolve the most issues for each Alaskan community. The following are the basic components of a business plan: 1)Executive Summary: Highlights the most significant points of the plan 2)Marketing Plan: Information about the consumer, the consumers competitors and the industry and how you will reach 3)SWOT Analysis: Situational Analysis 4)Services and Products: Description of what you are going to sell 5)Structure and Organization: Legal formation,organization chart of human resources needs 6)Financials: Financial structure and financial performance expectations 7)Contingencies: When achievements are expected to occur and what will be done if expectations are 1o0t met 3)Exit Strategy: How,why and when you may exit the business The SWOT analysis is the first step in a longer journey.Generally,the SWOT analysis looks at four areas.Strengths and Weaknesses are considered a look internally at the plan and will be used to develop strategic initiatives to address weaknesses and leverage strengths.Opportunities and Threats are considered an external look at what stakeholders can do to "rain on your parade"or move the concept forward. After the SWOT analysis,we should identify the services and products we intend to sell and then analyze the.financials to see if an option will reduce the cost of energy.The energy model created for each community will show the ultimate energy market for each community but this should be reviewed to define a realistic market share. Each work groups should meet to determine available technology,verify the capital costs and debt service assumptions,operations and maintenance costs,costs to deliver the energy to market and available tonnage and costs of fuels. We may have access to technology information through the utilities for EPRI or CRN information.There is extensive information on each area except storage hydro and nuclear that are considered mature technologies. I will try to attend all the workgroup meetings to participate in the discussion.Please coordinate these meetings with Christa Caldwell to reserve meeting rooms and for mass notification of the meetings. Nothing is cast in stone and we should remain willing to discuss the next steps so we follow the most effective process in our search for a cost-effective energy-independent future.I have attached the narrative and workgroup report portions of the Fairbanks Energy Plan,for your information and to see where we can improve on our end product. What an enjoyable group with a positive attitude to start the day off.I believe that the Energy Plan for Alaska will start with the AEA team as our small group of people that care about the future of Alaska. Looking forward to meeting with you in the near future. Steven Haagenson Executive Director Alaska Energy Authority Statewide Energy Coordinator 907-771-3073 shaagenson@aidea.org _Short Term Relie a s Reduction of electric bills for both _residential and commercial rate-payers.:'Energy debit cards for each household_based on the qualified PFD household_members-_Conservation incentive program e Nopprogram is perfect,but they must bejust;nd fair to all Alaskans,avoidunnecessarytaxationandhavealikelihoodof'sSUCCESS. Infusion CONFIDENTIAL Infusion State of Alaska 6/1/2008 TWILNAGCIANOD Vision Statement Provide relief for economically hurting Alaskans. 6/1/2008 TIVWILNAGIANOD Goal Questions a How much should the State of Alaska help?| Where does the money come from? 6/1/2008 TIWILNAGIANOD a Oct 07 and Today's Situation fae (Natural gas)Residential aee_e ee ElectricSpaceHeatingTransparol "Octor eri |31185 88,a -May.084417 ejay 4.:-3,474 Yearly Total § S$4373 5 495 98% 6/1/2008 TVILNAGISANOD z Oct 07 and Today's Situation Sa (Hydro)Res -"008Electric- TransportationSpaceHeating 4 Residential 1349 - Yearly Total A617 10.7% >1B|lanaAHp,6/1/2008 TWILNAGIANOOD Fock 07 and Today's Situation - cs|-:0 SiT a SpaceHeatingLesTranspotalion May08=aa 0273.501aYearly7Total_9,082 90.A% 6/1/2008 TIWILNAGIANOO 7 Alaska (Diesel)Residential 9 25,625 ee Oct-07 May-08 Electricw/PCE $1,235 $1,753"SpaceHeating $5,187 $§$6,596 Transportation $1,430 $1,941 Yearly Total $7,852 $10,291 30.6%40.2%LI6/1/2008 TIWILNACISANOD a Available Options E.Direct Disbursement a Modify Existing Programs mo Debit Card , mo EBT Card ga Tax Relief a Grant to Utilities Grants to Refiners/Bulk Fuel Distributors 6/1/2008 TIWILNAGISANOD Disburseme STRENGTHS OPPORTUNITIES -Direct infusion of cash -Follow the Permanent Fund process -Provide additional checks if needed. WEAKNESSES THREATS -One time check -May not be spent on energy -Looks so much like the PFD,there may be expectation of ongoing disbursements -Does not help businesses. -Disbursement will be taxable -The money may not be distributed to the area of most need. |-PR nightmare if this becomes an entitlement oFDoes every PFD participant get an Energy Check? 6/1/2008 TWILNAGIANOOD gdity Existing Pr ogramsEy STRENGTHS OPPORTUNITIES -Direct infusion of cash -Follow the Permanent Fund process -Payments could be made using existing programs such as LIHEAP,PCE or Bulk Fuel Loans.| WEAKNESSES THREATS -May not be spent on energy -Need significant program re- definition to allow disbursement. -Zero flexibility in adjusting income levels. -Disbursement will be taxable -The money may not be distributed to the area of most need. -Federal "income”definition may conflict with intended infusion. What would be the State overhead to administer this program? Would fuel suppliers be willing to modify software to provide for this relief payment? L*"|6/1/2008 TWILNAGISNOOD Debit Card hh STRENGTHS OPPORTUNITIES Direct infusion of cash Card could only be used for Energy? Recharge debit cards -Banks may modify programs for the business exposure. WEAKNESSES THREATS All money may not be spent on energy for electricity,heating oil,road diesel or gasoline. Banks would have to issue a card for each household. Conflicts over dependent cash management. -Disbursement will be taxable -The money may not be distributed to the area of most need. -Business will need to monitor proper use or modify programs to track spending.LoShould the money be spread out of lump sum once a year? Should the distribution be one per household in both parents names,or to each person separately? |Li |6/1/2008 TWILNACISANOD Ch STRENGTHS OPPORTUNITIES -Direct infusion of cash -All benefits carry forward and are -Card could only be used for Energy?expunged after 180 days. --Recharge debit cards -Cards could be set up with different accounts. WEAKNESSES THREATS -All money may not be spent on energy for electricity,heating oil,road diesel or gasoline. -State would have to issue an EBT card for each household. -Conflicts over dependent cash management. -Disbursement will be taxable -The money may not be distributed to the area of most need. -Business will need to monitor proper use or modify programs to track spending. -May be too complex for the benefit. Should the money be spread out of lump sum once a year? Should the distribution be one per household in both parents names,or to each person separately? USI7ZUUG IWILNAGISNOO STRENGTHS OPPORTUNITIES -Would be disbursed based on fuel usage. WEAKNESSES THREATS -Very small benefit "LI6/1/2008 IILNACISNOO Gragis to Electric Ysilities -Spread over the entire year. -Limited checks directly to utilities -Most utilities under RCA or PCE STRENGTHS OPPORTUNITIES -Direct infusion of cash in economy -Provide additional checks if needed. -Disbursement to both private and -Disbursements would not be taxable. business -Allows for a conservation incentive. control. WEAKNESSES THREATS -Large sums returned to commercial -The money may not be distributed to who use large amounts of electricity.the area of most need. -All households receive about the same;-PCE reduces the payment to rural amount.areas. -Does not help areas with low electrical |- use but high energy use such as fishing fleets. -Would exclude the Red Dog mine. ||U/1L/ZUUG TWILNAGIANOD tS to RefinersfBulk Fuel STRENGTHS OPPORTUNITIES Direct infusion of cash in economy Disbursementto both private and business Spread over the entire year. Limited checks directly to refiners and bulk fuel suppliers. Hits electric,space heating and transportation based on local usage. Helps all energy users including the fishing fleet,utilities and refiners Most areas willsee a reduction in electric, space heating and transportation costs. Anchorage will see reduction in transportation costs. -Provide additional checks if needed. -Disbursements may not be taxable. -Allows for a conservation incentive. -Utility use is included to reduce the cost of electricity. -Money would be directly distributed to areas hit the hardest by rising fuel. -Open negotiation of reduced products based directly on crude reduction. -Allows matching to determine State needs. WEAKNESSES THREATS Refiners/bulk fuel may not be transparent on profits and costs. -Grants may be taxable. Are grants to refiners and bulk fuel distributors taxable events? 6/1/2008 IWILNACIANOD Recommendation ae Reduction of electric bills -a State issued Energy Debit card. The State would pay for 60%of electric utility bills for both residential and commercial accounts. The Energy Debit card would be provided to each household and be credited at $120 per month per Permanent Fund Dividend (PFD)recipients in that household.The Energy Debit card amount will be considered taxable. 6/1/2008 TWILNAGISANOD Pg.Recipient 19 SE conference 19 SE conference 38 AVEC 39 Chugach Electric 40 CVEA 40 CVEA 40 CVEA 40 CVEA 41 FEDC 42 HEA 42 HEA 42 HEA 44 Tok Community Umbrella 63 SES 64 Unalaska 64 Chalkyitsik 72 DNR 74 DNR 77 ANGDA 89 AEA 89 AEA 89 AIDEA 89 AEA 89 AEA 94 AVCP . 95 Chaninik Wind Group 98 Interior Regional Housing Authority 100 MEA 100 Nanwalek IRA Council 101 Nushagak Elect and Tele coop 131 Nome 132 NSB 134 Sitka 134 Unalaska 135 Valdez 136 Metlakatla 154 DNR Purpose Kake Petersburg Intertie Energy Program Reimbursement for fuel tank relocation Hope Power line relocation and hazard mitigation Glenallen diesel plant upgrade Intertie construction cost recovery Allison Lake hydro project license application Valdez diesel plant substation upgrade Synthetic fuel design engineering Upgrade Electrical Distribution and Trans system South Kachemak Bay Cable Replacement project Hazardous tree removal Wood Chipper Project Seward -Purchase of Back-up Generators Geothermal exploration Overhead Elec.Distribution and wiring renovation Cook Inlet Energy Assessment Mat us Borough hydrogeology assessment Bullet line study Energy Projects Fire Island Wind farm transmission lines Ketchikan Shipyard Susitna Hydro study and Railbelt energy plan Renewable Energy Projects Emergency Generator Upgrades & Metering Regional Wind energy systems purchase and installation YKSD energy savings project Line Upgrades Backup generator Power generation upgrade phase 1 Power plant construction completion Wainwright Coal Bed Methane Blue lake hydro project Power generation expansion HS emerg generator and switchgear Emergency storage system Alaska Energy Inventory Phase 1 Approved (000) $500 $---__-_-499 $570 $200 $2,000 $---_-__4+500 $1,000 $500 $300 $-----42,5090 $1,100 $250 $500 $2,000 $1,000 $100 $260 $295 $4,000 $39,800 $25,000 $3,000 $2,900 $1,000 $1,350 $4,800 $--_-__233 $------25,000 $25 $1,000 $2,900 $850 $12,500 $1,500 $6 $682 $350 209 AEA 215 AEA 217 Gustavus reapprop 222 SE Conference 227 AEA AEA (with strings) Statewide Energy Plan RERLF-Electrical Emergencies Program Hydro project redirected to the utility Reynolds Creek Hydro project Reapprop from Teeland upgrade for intertie repairs Capitalization of the renewable energy fund HB#152 AAS1,200 330 300 2,000 10,000 50,000 LAWS OF ALASKA 2008 Source Chapter No. SCS CSHB 152(FIN)am S >| AN ACT Establishing a renewable energy grant fund and describing its uses and purposes;establishing a renewable energy grant recommendation program;for the fiscal year ending June 30,2009, authorizing the Alaska Energy Authority to distribute renewable energy grants and setting out the procedures to be followed to award those grants;establishing a state heating assistance program in addition to the federal heating assistance program;establishing an Alaska Renewable Energy Task Force;and providing for an effective date. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: THE ACT FOLLOWS ON PAGE 1 Enrolled HB 152 AN ACT Establishing a renewable energy grant fund and describing its uses and purposes;establishing a renewable energy grant recommendation program;for the fiscal year ending June 30,2009, authorizing the Alaska Energy Authority to distribute renewable energy grants and setting out the procedures to be followed to award those grants;establishing a state heating assistance program in addition to the federal heating assistance program;establishing an Alaska Renewable Energy Task Force;and providing for an effective date. *Section 1.The uncodified law of the State of Alaska is amended by adding a new section to read: LEGISLATIVE FINDINGS AND INTENT.(a)For secs.3 and 6 of this Act,the legislature finds that (1)an adequate,reliable,reasonably priced,and safe supply of energy is -l-Enrolled HB 152 OoOoTIWBNHRWYNYWwWWwWNYONYNYNYNYNYNYNNNHN|FFRFeReeeeRe=COOOwowDBunmBPWNYKDODOoDBADHUHFFWYNY|O&Onecessary for Alaska's basic infrastructure and economic and technological development; (2)Alaska possesses vast amounts of renewable energy resources in the form of wind,solar,geothermal,hydrothermal,wave,tidal,biomass,river in-stream,and hydropower; (3)the legislature established the Alaska Energy Policy Task Force in 2003 to review and analyze the state's current and long-term energy needs; (4)the task force found that one of Alaska's long-term energy needs is to identify and evaluate long-term fuel resources,and recommended that the state should increase the proportion of renewables in long-term fuel sources; (5)the cost of fuels such as natural gas and diesel that Alaskans rely on in large part to generate electric power is steadily rising; (6)residents of rural Alaska pay far more for electricity than residents who live on the Railbelt energy grid; (7)there is virtually no fuel cost associated with renewable energy resources; (8)other states and nations are working successfully to develop their renewable energy resources; ) (9)the continued competitiveness and stability of the state's economy requires that the legislature consider national trends toward renewable energy development; (10)renewable energy technology development promotes industry and creates jobs; (11)clean renewable energy has many environmental and health benefits; (12)locally produced renewable energy has many security benefits; (13)modern,affordable,and efficient renewable energy technologies now exist; (14)it is in the interest of the public for Alaska to develop its renewable energy resources;and (15)natural gas can be considered as a last alternative for communities with no other reasonable renewable resources. (b)It is the intent of the legislature that each year for the next five years $50,000,000 in capital funds be appropriated to fund projects recommended by the Alaska Energy Authority as described in secs.3 and 6 of this Act. Enrolled HB 152 -2- OoOOSNDNnHFPWYYNWwWwWYOHONYNYNYNYNYWNNYNOFFFFFPYFFPSeESehlhhlULrS--$OoOOoDDWBWNYK*§ODOOODnDnBPWwWNY|O&O(c)For sec.7 of this Act,the legislature finds that (1)energy issues are among the most critical issues in the state;and (2)a thorough assessment of present and future state energy needs and requirements is necessary. *Sec.2.AS 36.30.850(b)is amended by adding a new paragraph to read: (46)contracts for delivery of home heating assistance under AS 47.25.626. *Sec.3.AS 42.45 is amended by adding a new section to read: Sec.42.45.045.Renewable energy grant fund and recommendation program.(a)A renewable energy grant fund is established as a separate fund to finance certain energy projects in Alaska. (b)The authority shall administer the fund as a fund distinct from other funds of the authority.The fund consists of (1)money appropriated to the fund by the legislature to provide grants for certain energy projects determined by the legislature; (2)gifts,bequests,contributions from other sources,and federal money; (3)interest earned on the fund balance;and (4)investments to be managed by the Department of Revenue,which shall be the fiduciary of the fund under AS 37.10.071. (c)The fund is not a dedicated fund. (d)The authority shall,in consultation with the advisory committee established under (i)of this section and the Department of Natural Resources, (1)develop a methodology for determining the order of projects that may receive assistance,including separate requirements for grant eligibility,and adopt regulations identifying criteria to evaluate the benefit and feasibility of projects for which an applicant applies for support from the legislature,with the most weight being given to projects that serve any area in which the average cost of energy to each resident of the area exceeds the average cost to each resident of other areas of the state,and significant weight being given to a statewide balance of grant funds and to the amount of matching funds an applicant is able to make available; -3-Enrolled HB 152 oOomemnHNDBABPWYNYWwWNNYNYNYNYNYNYNYNYHNRPRFRPFeRPeReRERe--20OxDWNFFWwWNY|§DODOAnHDHAHFPWN|O&O(2)make recommendations to the legislature for renewable power production reimbursement grants;and (3)not later than 10 days after the first day of each regular legislative session,submit to the legislature a report summarizing and reviewing each grant application submitted under this section and a recommended priority for awarding grants. (e)In consultation with the advisory committee established in (i)of this section,the authority shall make recommendations to the legislature regarding eligible applicants'projects that finance feasibility studies,reconnaissance studies,energy resource monitoring,and construction of renewable energy projects,natural gas projects,or transmission or distribution infrastructure located in Alaska that meet the requirements of (f),(g),or (h)of this section,as applicable,and shall,at least once each year,solicit from the advisory committee funding recommendations for all grants. (f)For a renewable energy project to qualify for a grant recommendation under (e)of this section,the project must (1)bea new project not in operation on the effective date of this section or an addition to an existing project made after the effective date of this section;and (2)bea (A)hydroelectric facility; (B)direct use of renewable energy resources; (C)facility that generates electricity from fuel cells that use hydrogen from renewable energy resources or natural gas;or (D)facility that generates energy from renewable energy resources. (g)To qualify for a grant recommendation under (e)of this section,a project that is a natural gas project must benefit a community that (1)has a population of 10,000 or less;and (2)does not have economically viable renewable energy resources it can develop. Enrolled HB 152 -4. oOCOSNWBOHBPWYNYWiWwwoNYONYKHNYNYNYKYWHYNY|KHRFPFFEFPPElLES--OC06onDAWwWF&FWNYKHODODOWHADHFFWNH|O&O(h)To qualify for a grant recommendation under (e)of this section, transmission or distribution infrastructure must link a renewable energy project or natural gas project to the transmission or distribution infrastructure.A grant may be recommended under this subsection even if the grant applicant is not itself financing the construction of the renewable energy project or natural gas project. (i)An advisory committee is established and consists of seven members, appointed as follows: (1)five members shall be appointed by the governor to staggered three-year terms,with one representative to be appointed from each of the following groups: (A)small Alaska rural electric utilities; (B)large Alaska urban electric utilities; (C)Alaska Native organizations; (D)businesses or organizations engaged in the renewable energy sector;and . (E)the Denali Commission established under P.L.105-277,42 U.S.C.3121 note; (2)one member of the house of representatives shall be appointed by the speaker of the house of representatives;and (3)one member of the senate shall be appointed by the president of the senate. (j)A member of the advisory committee appointed under (i)of this section serves without compensation but is entitled to travel and per diem expenses as provided in AS 39.20.180. (k)The legislature may appropriate money for grants from the renewable energy grant fund for renewable energy projects described in this section. (J)In this section, (1)"eligible applicant"means an electric utility holding a certificate of public convenience and necessity under AS 42.05,independent power producer,local government,or other governmental utility,including a tribal council and housing authority; -5- . Enrolled HB 152 OoONDWAHPRWDNHWwWWwNONYONYONYNHWYWNNYNYNOYFPFFFFPFYFPElllS=@©O0OTAHABWNYKHODOBOmAHHDWHBRWNYY©(2)"fund"means the renewable energy grant fund; (3)"hydroelectric facility"has the meaning given to the term "project" under AS 42.45.350; (4)"natural gas project"means use or access of natural gas other than landfill or digester gas; (5)"renewable energy resources"means (A)wind,solar,geothermal,wasteheat recovery,hydrothermal, wave,tidal,river in-stream,or hydropower; (B)low-emission nontoxic biomass based on solid or liquid organic fuels from wood,forest and field residues,or animal or fish products; (C)dedicated energy crops available on a renewable basis;or (D)landfill gas and digester gas. *Sec.4.AS 47.25 is amended by adding new sections to read: Article 3A.Alaska Heating Assistance Program. Sec.47.25.621.Alaska heating assistance program.(a)The Alaska heating assistance program is established in the Department of Health and Social Services to provide expanded eligibility for Alaska residents for home heating assistance,to the extent funds are appropriated by the legislature for that purpose. (b)The heating assistance program established under this section is in addition to the federal low-income heating and energy assistance provided under 42 U.S.C. 8621 -8629 (Low-Income Home Energy Assistance Act of 1981),as amended,and implementing regulations. Sec.47.25.622.Duties.The department shall (1)administer the Alaska heating assistance program provided under AS 47.25.621; (2)adopt regulations under AS 44.62 (Administrative Procedure Act) to carry out the purpose of the program; (3)coordinate payments among other heating assistance programs to avoid duplication of payments. Sec.47.25.623.Eligibility.An individual is eligible for home heating assistance payments under the Alaska home heating assistance program if the Enrolled HB 152 -6- OoOoSNBDWAHPWNHWwWWBNYNHNYNYNYNHNNWNNYNYNYFFFFrFYFFPePOhlhlhhlUL--©O06oOoQAWABPWNKHTDHOAnHDUHFWY|O&Oindividual (1)is a resident of the state; (2)is physically present and resides in a home in the state when the home heating costs are incurred; (3)has gross household income above 150 percent but that does not exceed 225 percent of the federal poverty guideline for Alaska set by the United States Department of Health and Human Services and revised under 42 U.S.C.9902(2); |(4)meets other eligibility requirements specified in regulations adopted under AS 47.25.622. Sec.47.25.624.Appeal rights.Except as provided in AS 47.25.626(e),an individual who receives a determination from the department that denies,limits,or modifies home heating payments under AS 47.25.621 -47.25.626,other than a determination based on insufficient funding of the program,may request a hearing before the department under regulations adopted by the department. Sec.47.25.625.Ability to recover or recoup improper home heating assistance payments.An individual is liable to the department for the value of assistance improperly paid under AS 47.25.623 if the improper payment was based on inaccurate or incomplete information provided by the individual.In a civil action brought by the state to recover from the individual the value of the assistance improperly paid,the state may recover from the individual the costs of investigation and prosecution of the civil action,including attorney fees as determined under court tules. Sec.47.25.626.Regional heating assistance program.(a)The department may develop a regional Alaska heating assistance program for the administration of AS 47.25.621 -47.25.626 to provide home heating assistance in a uniform and cost- effective manner in a region of this state ifan Alaska Native organization is authorized to implement a federally approved tribal family assistance plan that includes that region and has been awarded a tribal energy assistance grant for a program that includes that region under 42 U.S.C.8623(d). (b)The department may award contracts to implement a program developed under (a)of this section.A contract authorized for delivery of home heating assistance -7-Enrolled HB 152 OoONWDWHPWNYwoWwWNYONONYOHNONNNOYNHNKORROeeKeOOONDAWNFPWNKYDODODOOnDWHFPWYNY|O&Ounder a regional Alaska heating assistance program under this section is exempt from the competitive bid requirements of AS 36.30 (State Procurement Code).Subject to appropriation,a contract under this section must be in an amount that represents a fair and equitable share of the money appropriated for the Alaska heating assistance program under AS 47.25.621 -47.25.626 to serve the state residents specified in (a)of this section.The authority provided under this section to contract is in addition to the authority to contract in AS 47.05.015 or other law. (c)The department may award a contract under this section only to an organization that (1)has been awardeda tribal energy assistance grant under 42 U.S.C. 8623(d)for a program that includes that region; (2)agrees to administer home heating assistance under AS 47.25.621 - 47,25.626 to state residents in the region;and (3)agrees to implement an appeals process as described in (e)of this section. (d)Records pertaining to recipients of home heating assistance under a contract awarded under this section are confidential and not subject to disclosure under AS 40.25.100 -40.25.220. (e)An organization that receives a contract under this section shall provide an appeals process to applicants for or recipients of home heating assistance covered by the contract awarded under this section.The appeals process must be the same as the method available under AS 47.25.624,except that the decision reached shall be considered a recommended decision to the department.Within 30 days after receiving a recommended decision,the department shall review the recommended decision and issue a decision accepting or rejecting the recommended decision.If the department rejects the recommended decision,the department shall independently review the record and issue its final decision.The final decision of the department on the matter is appealable to the courts of this state. ) (f)If the department establishes a regional Alaska heating assistance program and awards a contract to provide home heating assistance under this section,a person applying for home heating assistance under AS 47.25.621 -47.25.626 in the region of Enrolled HB 152 -8- OoOOHNDBWHFPWDNO=WwWWwWHONYNYNNNNNHNYMYNHNYHFYKHYFPFPFSFFFPlhlULS=©0onyAWNFWNYKHDBDODODADnFPWwWNH &the state covered by the regional Alaska heating assistance program may obtain home heating assistance from the department only through the organization designated by the department to serve the region. *Sec.5.AS 42.45.045 is repealed June 30,2013. *Sec.6.The uncodified law of the State of Alaska is amended by adding a new section to read: RENEWABLE ENERGY GRANTS DURING STATE FISCAL YEAR 2009.(a)For the fiscal year ending June 30,2009,from an appropriation made under the statement of intent set out in sec.1(b)of this Act,the Alaska Energy Authority shall distribute grants to applicants determined by the authority and that meet the criteria in_AS 42.45.045(f)-(h), added by sec.3 of this Act,based on the procedure described in (b)of this section. (b)For administering grants under AS 42.45.045(f)-(h),added by sec.3 of this Act, for the fiscal year ending June 30,2009,notwithstanding AS 42.45.045(d),(e),and (i)-(J), added by sec.3 of this Act, (1)the Alaska Energy Authority shall submit to the Legislative Budget and Audit Committee for review a revised program setting out the proposed grants; (2)45 days shall elapse before commencement of expenditures under the revised program unless the Legislative Budget and Audit Committee earlier recommends otherwise; | (3)should the Legislative Budget and Audit Committee recommend within the 45-day period that the Alaska Energy Authority not award the grants as set out in the revised program,the Alaska Energy Authority shall again review the grant applications and,if the Alaska Energy Authority determines to authorize the expenditures,the Alaska Energy Authority shall provide the Legislative Budget and Audit Committee with a statement of the Alaska Energy Authority's reasons before commencement of expenditures making the approved grants. *Sec.7.The uncodified law of the State of Alaska is amended by adding a new section to read: ALASKA RENEWABLE ENERGY TASK FORCE.(a)There is established in the legislative branch of state government the Alaska Renewable Energy Task Force.The task force consists of seven voting members appointed as follows: -9.Enrolled HB 152 OoOaNDAFPWYYNwoWwWYONYONYONHNNHNYVYKVKNNORReReREREEEeSOe---COC0OADBHWFPWwYHHFDOBHDWHFWNY|&(1)the speaker of the house of representatives shall appoint three members from the house of representatives; (2)the president of the senate shall appoint three members from the senate; and _ (3)the governor shall appoint one member. (b)The chair of the task force shall be a legislative member selected by a majority vote of the members of the task force.The staff of the members who are legislators shall serve as staff to the task force. (c)The task force shall prepare a report that includes (1)an assessment of future statewide renewable energy needs;and (2)recommendations for a statewide energy plan to fulfill the state's renewable energy needs. (d)Members of the task force are entitled to transportation expenses and per diem allowances provided by law. (e)The task force shall meet at least four times.The task force may meet in communities in the state that are using or considering sources of renewable energy. (f)The task force shall submit written reports of its findings and recommendations to the legislature (1)before March 1,2009;and (2)before March 1,2010. (g)The Alaska Renewable Energy Task Force is terminated on April 16,2010. *Sec.8.The uncodified law of the State of Alaska is amended by adding a new section to read: TRANSITION:RENEWABLE ENERGY PROJECT ADVISORY COMMITTEE. For the initial appointments made to the advisory committee under AS 42.45.045(i)(1),added by sec.3 of this Act,two members serve for one year,two for two years,and three for three years. *Sec.9.The uncodified law of the State of Alaska is amended by adding a new section to read: TRANSITION:RETROACTIVITY OF REGULATIONS.Notwithstanding a contrary provision of AS 44.62.240,if the Department of Health and Social Services expressly Enrolled HB 152 -10- OowanWBWHHhWYNe--©designates in a regulation adopted under AS 47.25.622(2),enacted by sec.4 of this Act,that the regulation applies retroactively to November 1,2007,and is necessary to implement, interpret,make specific,or otherwise carry out AS 47.25.621 and 47.25.623,enacted by sec.4 of this Act,the regulation may apply retroactively to November 1,2007. *Sec.10.Sections 1(c)and 7 of this Act are repealed April 16,2010. *Sec.11.The uncodified law of the State of Alaska is amended by adding a new section to read: RETROACTIVITY OF CERTAIN PROVISIONS OF THIS ACT.AS 47.25.621 and 47,.25.623,enacted by sec.4 of this Act,are retroactive to November 1,2007. *Sec.12.Sections 2,4,9,and 11 of this Act takes effect immediately under AS 01.10.070(c). -L1-Enrolled HB 152, STATE OF ALASKA 2008 LEGISLATIVE SESSION Identifier (file name): FISCAL NOTE HB152SCSCS(FIN)-CED-AEA-04-09-08 Title Establish Renewable Energy Fund/Account Sponsor Harris et al Requester Senate Finance Expenditures/Revenues Fiscal Note Number: Bill Version:SCS CSHB 152(FIN) {)Publish Date: Dept.Affected:DCCED RDU Alaska Energy Authority (453) Component AEA Statewide Project Dev and AEEE Component Number 2888 (Thousands of Dollars) Note:Amounts do not include inflation unless otherwise noted below. Appropriation Required Information OPERATING EXPENDITURES FY 2009 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 Personal Services Travel 20.0 5.0 5.0 5.0 5.0 Contractual 200.0 150.0 150.0 150.0 150.0 Supplies 6.0 Equipment Land &Structures Grants &Claims Miscellaneous TOTAL OPERATING 226.0 0.0 155.0 155.0 155.0 155.0 0.0 {CAPITAL EXPENDITURES |CHANGE IN REVENUES () FUND SOURCE (Thousands of Dollars) 1002 Federal Receipts 1003 GF Match 1004 GF 226.0 155.0 155.0 155.0 155.0 1005 GF/Program Receipts 1037 GF/Mental Health 10XX Renewable Energy Fund TOTAL 226.0 0.0 155.0 155.0 155.0 155.0 0.0 Estimate of any current year (FY2008)cost: POSITIONS Full-time Part-time Temporary ANALYSIS:(Attach a separate page if necessary) This legislation creates a renewable energy grant recommendation program to be administered by the Alaska Energy Authority (AEA)and establishes a seven member advisory committee.This legislation requires AEA,in consultation with the advisory committee,to establish regulations to 1)develop a methodology for determining the order of projects that receive assistance 2)determine grant and eligibility 3)identify criteria to evaluate the benefit and feasibility of potential projects 4)develop a methodology for distributing funds to finance various studies and construction projects 5)provide for power production incentives to reduce principal balances of loans.AEA will provide recommendations to the legislature for annual appropriations for eligible projects. Prepared by:Sara Fisher-Goad,Deputy Director-Operations Phone 907-771-3012 Division Alaska Energy Authority Date/Time 4/9/08 9:16 AM Approved by:Emil R.Notti,Commissioner Date 4/9/2008 Agency Department of Commerce,Community,and Economic Development {Revised 11/19/2007 OMB)Page 1 of 2 FISCAL NOTE STATE OF ALASKA BILL NO.SCS CSHB 152(FIN) 2008 LEGISLATIVE SESSION ANALYSIS CONTINUATION FY 2010 through FY 2013,in consultation with the advisory committee,AEA shall make appropriation recommendations to the legislature for projects to finance feasibility studies, reconnaissance studies,energy resource monitoring,and construction of renewable energy projects,natural gas projects,or transmission or distribution infrastructure located in Alaska.AEA shal!annually solicit funding recommendations from the advisory committee for all grants and loans. This legislation establishes project eligibility criteria for a renewable energy project,a natural gas project and a transmission or distribution infrastructure project. This fiscal note represents costs associated with a new project manager who will be responsible for developing the regulations in consultation with the advisory committee.$100.0 in contractual costs for AIDEA and one-time $6.0 supply costs associated with the position.For FY 2009 an additional $100.0 is required to assist in developing the evaluation criteria and evaluate the proposals.Subsequent years we anticipate $50.0 required for evaluation of the proposals.The fiscal note also provides estimated travel costs for the 7 member committee to meet 4 times in FY 2009 for the initial development phase of regulations and annually to solicit funding recommendations. Page 2 of2 FISCAL NOTE STATE OF ALASKA Fiscal Note Number: 2008 LEGISLATIVE SESSION Bill Version:CS SB 246 (RES)#2 ()Publish Date: Identifier (file name):Dept.Affected: Title SUSITNA HYDRO WORKING GROUP;REPORT RDU AEA (453) Component Statewide Project Development Sponsor Senator Thomas Requester Senate Resources Component Number 2888 Expenditures/Revenues (Thousands of Dollars) Note:Amounts do not include inflation uniess otherwise noted below. Appropriation Required -_{nformation OPERATING EXPENDITURES FY 2009 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 Personal Services Travel Contractual Supplies Equipment Land &Structures Grants &Claims Miscellaneous TOTAL OPERATING 0.0 0.0 0.0 0.0 0.0 0.0 0.0 |CAPITAL EXPENDITURES 2,750.0 |{1,500.0 |||| |CHANGE IN REVENUES ()||1 ||| FUND SOURCE (Thousands of Doilars) 1002 Federal Receipts 1003 GF Match 1004 GF 2,750.0 1,500.0 1005 GF/Program Receipts 1037 GF/Mental Health Other Interagency Receipts TOTAL 2,750.0 0.0 1,500.0 0.0 0.0 0.0 0.0 Estimate of any current year (FY2008)cost: POSITIONS Full-time Part-time Temporary ANALYSIS:(Attach a separate page if necessary) This legilsation directs the Alaska Energy Authority (AEA)to analyze the hydroelectric potential of the Susitna River. AEA will consult with various government agencies,railbelt utilities,native corporations,other landowners,and various regional economic development councils. The legislation requires the Governor to submit AEA's report of the findings to the legislature by June 1,2010.The following pages detail the estimated cost of the report. Prepared by:Sara Fisher-Goad,Deputy Director -Operations Phone 907-771-3012 Division Alaska Energy Authority Date/Time Approved by:Date (Revised 11/19/2007 OMB)Page 1 of 3 FISCAL NOTE STATE OF ALASKA BILL NO.SB 246 2008 LEGISLATIVE SESSION ANALYSIS CONTINUATION The work tasks and goals are envisioned to complete the objectives of SB 246,the timeline is provided for each task to illustrate work tasks that could be done in parallel rather than sequential. SB 246 objectives 2,3,5,9,13 Work Task 1:Feasibility Study and Estimate of Plant and of Generated Power Costs The 1984 estimates for construction of the Susitna Hydro project will be updated for current costs as well as current construction and design technology.Constructability and logistics will be key components of this update.Additionally a review of engineering and technical risks including seismic design will be identified. The design of this facility is such that there are minimal size reductions that can be done.While there may be a need for 700 MW of generating capacity the constraints of the Susitna site may allow for options of 300 MW,1000 MW,and 1,620 MW only.The study therefore will examine the possible size options that are inherent in the 1984 estimate and provide capital,operating and maintenance costs and subsequent costs of power over the lifetime of the facility for those options.Additionally,modifications and estimates for upgrades of the Railbelt Electrical Grid to allow use of this new generation capacity will be developed. Timelines for design,permitting,and construction for each option will be developed. Estimated Cost:$1,500,000 Schedule:30 June 2008 -30 September 2009 SB 246 objectives 1,2,3,12 Work Task 2:Integrated Systems Energy Plan for the Railbelt A strategic energy plan for the Railbelt area will be developed.This will examine projected energy demands under a variety of different future scenarios that will examine growth in population,potential new industrial demands,changes in air and water regulations,fuel costs,development of new energy technologies,as well as risks of the variety of generating options.The objective of this plan is to provide balanced view of energy needs and opportunities to allow for informed decisions on energy projects. Estimated Cost:$1,000,000 Schedule:30 June 2008 -30 January 2010 $B 246 objective 6 Work Task 3:Financing Options The size of this single generation will be in excess of $5 billion and while it may provide a competetive cost of power,the ability to finance the costs may be the limiting factor.An analysis of potential financing options will be developed.; Estimated Cost:$200,000 Schedule:30 January 2009 30 September 2009 SB 246 objective 4 Work Task 4:Cost of Power for Selected Alternatives An estimate of approximate costs of alternative power generation that would be accessible to the Railbelt will be made.Options will consider the appropriate use of coal,natural gas,wind,geothermal,tidal and an alternate source of hydro.These estimates will be used to compare the reasonability of power generation from Susitna as well as the displacement opportunity of other fuels this project will enable.An important outcome of this activity will the determination of the costs/values of emissions each generating option will provide,this will include such things as carbon emissions/capture and mercury emissions. Estimated Cost:$800,000 Schedule:30 March 2009 -31 December 2009 Page 2 of 3 ANALYSIS CONTINUATION SB 246 objectives 7,8,10,11 Work Task 5:Environmental/Socio-economic Impact Study Environmental permitting and the socio-economic impact on the affected area is a key component of this study and will have the most impact on the feasibility of this study.A review of necessary permits,licenses and an analysis of potential impacts to the area will be done.Economic impacts and opportunities,including construction and operation jobs,which will result from a project of this size and generating capacity will be determined. Estimated Cost:$500,000 Schedule:30 January 2009 -30 September 2009 SB 246 objectives 8,10,11 Field Work . _Limited field work is envisioned;however there may be need for helicopter access to the location of the proposed dam sites as well as limited amount of field work including terrain,river conditions and potential construction camp sites and lay down areas. Estimated Cost:$250,000 Schedule:30 June 2008 -30 September 2009 Proposal Summary Total Estimated Sustina Study Cost:$3,250,000 Total Estimated Cost with Railbelt Energy Plan:$4,250,000 FY 09 -$2,750,000 FY 10 -$1,500,000 it is anticipated that this work will take approximately two years,with the draft report available in January2010andafinalreportincludingaRailbeltenergyplanavailableinJune2010.Over the course of theprojectinterimreportswillbeissuedandspecificdecisiongatesonproceedingwithphasesoftheproject will be developed.If at anytime the feasibility of the Susitna Dam project becomes non-viable the project will be curtailed. Page 3 of3 May 27,2008 Governor Sarah Palin P.O.Box 110001 Juneau,AK 99811-0001 Support for Governor's Proposed Energy Relief Proposal Dear Governor Palin, Alaska Village Electric Cooperative is very pleased to see that you are clearly determined to assist your fellow citizens who are struggling to keep their heads above the rapidly rising waters of energy costs and we would like to respectfully suggest an alternative approach. Attached is a resolution passed last week by the AVEC board of directors.This resolution expresses the strident concern that our members are already struggling with today's extremely steep electricity prices brought about by last year's leap in fuel prices, and AVEC is struggling with the inability to pay for the fuel we must buy today for next year's electricity production.Today's fuel prices are 85%higher than a year ago. AVEC wishes to propose that fuel stock purchased prospectively by electric utilities be price capped at some number and we suggest $10.00 per million BTU.This would translate to a price of about $1.30 -$1.45 a gallon for various fuels,depending upon their BTU content.The fuel supplier would be the entity that would deliver the fuel, charge the utility the State mandated price and bill the State for the balance. Utilities would not have to contend with issues such as tax implications for revenues from non-customers and the State would have to deal with a relatively small number of vendors.This would impact future electric bills,typically several months out.Assuming that some 100 million gallons of petroleum fuels are purchased annually by electric utilities,this would have an impact to the State of about $320 million at today's prices. Utilities receiving this subsidized fuel should be required to immediately file for revised Fuel Cost Adjustment rates with the Regulatory Commission of Alaska,who should be directed to take immediate action on such filings so that relief can start flowing immediately to the utilities'customers. If this action occurs in the near future,it will provide immediate relief to the thousands of electric consumers in the state who are suffering tremendously from the extraordinary costs of electricity. AVEC Fuel Emergency Transmittal letter Page 2 of 2 We recognize that consumers in Anchorage,the Matanuska Valley and some Southeast communities will receive no direct benefit from this approach,as the fuel stock cost to their electric utility is below $10 per MMBTU.We suggest that these consumers would benefit greatly from a parallel program limiting the retail cost of transportation and heating fuels to $12.50 per MMBTU.Rather than a fuel debit card,which will be an administrative nightmare for the State,a cap on retail fuel rates will once again narrow the number of individuals that the State must deal with to a few major suppliers. |am sure there are many other creative approaches by which the State can use some of its excess oil earnings to alleviate some of the miseries that Alaskans are suffering due to the high cost of fuel.AVEC would be very happy to participate in any process that leads to realistic and viable solutions but,in the meantime,we have a very serious problem purchasing next year's fuel and we need your help. Yours very sincerely, MornelDw Meera Kohler President and CEO 4831 EAGLE STREET *ANCHORAGE,ALASKA *PHONE (907)561-1818)*FAX (907)562-4086 Resolution 08-27 Declaring Fuel Emergency WHEREAS,AVEC serves 53 villages in rural Alaska;communities that have the lowest per capita income in the state of Alaska and in the United States;and WHEREAS,Because of the historically very high cost of power,residents and businesses in AVEC's communities have been conserving power for many years,resulting in extremely low electricity consumption per capita and very poor economies of scale;and WHEREAS,Recent activity in world oil markets has resulted in delivered fuel cost reaching unprecedented levels;and WHEREAS,AVEC purchased fuel for its power plants at an avérage cost of $1.29 per gallon in 2002, escalating to $2.93 per gallon in 2007;and WHEREAS,AVEC''s fuel price for 2008 deliveries will be at least $4.60 per gallon based upon the L.A. Platt's Fuel Price Index as of May 13,2008,and WHEREAS,Crude oil prices closed on May 21,2008 at $132.57,which is a further increase of 6.7% over May 13,indicating that delivered fuel could cost as much as $4.87 per gallon;and WHEREAS,AVEC has issued purchase orders for fuel totaling 5,400,000 gallons that will likely cost at least $26,300,000;and WHEREAS,AVEC does not have the financial ability to make such an outlay,nor do its members have the financial ability to pay the electric bills that will ensue following incorporation of current fuel costs into rates -$0.25 non-fuel cost +$0.39 fuel cost =$0.64;and WHEREAS,Less than 50%of electricity sold by AVEC is eligible for PCE and that benefit is capped at costs below $0.525 per kWh. NOW THEREFORE BE IT RESOLVED that the AVEC Board of Directors declares a current and ongoing financial emergency;and, BE IT FURTHER RESOLVED that AVEC exhorts the State of Alaska to take proactive steps to. reduce the delivered cost of fuel to AVEC to a reasonable level of $10.00 per million BTU and BE IT FURTHER RESOLVED that AVEC petitions the State of Alaska to develop a relief program for its citizens such that the delivered retail cost of petroleum,propane and natural gas be capped at $12.50 per million BTU. CERTIFICATION I,Phyllis Clough,Secretary,do hereby certify that the above is a true and correct excerpt from the minutes of the meeting of the Board of Directors of the Alaska Village Electric Cooperative,!nc.,4831 Eagle Street,Anchorage,Alaska 99503,on the 23rd day of May 2008,at which meeting a quorum was present. oobi tleg:ég,.é,ote ELECTRA MePotes4,i b.ye oveee 7aeteatente,(*d.(seal)oy ar ORLim O %NYG ODEafLUE ; '"H CIT.te fe ;ot SEAL isr Phyllis Clough,Secretary weak POE Alaska Village Electric Cooperative,Inc.en nr =Mn she "te eesene th *s