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HomeMy WebLinkAboutUpper Tanana Biomass CHP Project R4, R6 Progress Report 2012 REF Grant 7040045Page 1 of 4 Alaska Energy Cost Reduction Program Close-out Report Grantee: Alaska Power and Telephone Company Project Name: Upper Tanana Biomass CHP Project Grant # 7040045 Period of Report: October 1 to December 31, 2012 Project activities completed: Energy Resource Analysis Biomass • The sustainable energy resource was primarily located in the Upper Tanana State Forest. Continuing work included negotiations between AP&T and Department of Forestry (DOF) developing a long term harvest agreement. Alternative Energy Resources • AP&T has evaluated several other alternative energy resources potentially available in the Tok area, including: • Wind • Hydroelectric • Diesel fueled engines • Diesel engines modified to burn mixed fuel of diesel and LPG/LNG • LPG/LNG engines Issues • Attaining long term agreement with the State. • Length of time to complete processes to develop the agreement with State of Alaska Department of Natural Resources (DNR) and DOF. Identification of Land and Regulatory Issues Biomass Harvest Land • Negotiations continue between AP&T and DOF to develop a long term harvest agreement. CHP Plant Land • The study still considers the three parcels of land introduced in the previous report. The parcels nearest the existing AP&T diesel plant are of primary interest. Public Outreach and Education • Meetings and discussions have been held with the public and local groups to provide information on the development of the CHP project that would utilize the woody biomass harvested from the forest around Tok. Grant Number 7040045 December 31, 2012 Upper Tanana Biomass CHP Project Page 2 of 4 • The public is encouraged to ask questions and provide comments. Issues • The DOF reevaluation of the biomass resource sale may affect the locations and boundaries of biomass harvest land. Significant changes in resource harvest location may impact the costs for biomass fuel transportation raising the O&M expense of the CHP plant. Permitting and Environmental Analysis Biomass • Permitting for the CHP plant and associated activities that support its operation will be identified as the technology and processes are more clearly understood. • The CHP plant will require environment permits for plant effluent streams. These will include an air quality permit and others depending on the CHP plant technology selected. • It is anticipated that it site specific logging operation permits will be required and that these will be acquired and maintained by the logging operations. Issues • None at this time Cost of Energy Analysis, Present and Future • Potential energy resources have been defined and are being studied • Biomass CHP • CHP energy is currently available from the Tok School • Recovery and utilization of CHP plant residual heat is being studied • As resource of process heat • As resource for district heating • Wind • Two locations have been identified near Tok as sites as significant wind resources • Metering data has been collected at one of the sites • Data has been analyzed and energy has been calculated • Hydroelectric • Run of river and pump storage options have been identified and are being studied • Diesel fueled engines • Diesel engines modified to burn mixed fuel of diesel and LPG/LNG • Currently attractive as gas is very low in cost and gas augmented engines have lower emissions • Potential of gas pipeline through Tok • LPG/LNG engines Grant Number 7040045 December 31, 2012 Upper Tanana Biomass CHP Project Page 3 of 4 Issues • None at this time Technology Alternative Analysis Biomass • Several combustion technologies have been identified and evaluated to convert the woody biomass in the region to commercial grade energy. • CHP equipment/system providers have been identified, contacted, and provided with specifications and a request for proposal (RFP). Issues • None at this time Conceptual Design and Cost Estimates Biomass • An overall design concept has been developed for the project. It includes; • Harvesting, chip processing and transportation of fuel to the CHP plant • Storage and handling of the fuel at the CHP plant • Operation of the CHP plant to provide electrical power to the utility • Operation of the CHP plant to provide heat • Studies have been completed to demonstrate the techniques and determine the costs associated with harvesting and processing the timber into chipped fuel. • Specific plans are being developed and will be fully realized after determining the most effective CHP plant technology. Issues • None at this time Economic and Financial Analysis Biomass • Northern Economics (NE), Anchorage completed their financial analysis of constructing and operating a CHP plant in Tok Conceptual Business and Operation Plans Biomass • The feasibility study identifies several alternatives that could be employed that would result in a successful CHP plant in Tok. Further analysis will be conducted in the design and engineering phase of the project that will identify the optimum CHP plant configuration. • Primary interest is for the CHP plant to operate as a power plant Grant Number 7040045 December 31, 2012 Upper Tanana Biomass CHP Project Page 4 of 4 • With a generating capacity to meet the current electrical loads of the Tok system • Studies to determine optimum method for utilizing the residual heat of the biomass plant • District heating • Process heat • Development of business financing plans and sources continue. • Development of a long term sales agreement with the resource owners. Issues • The DOF is in the process of reevaluating their approach to the sales of the timber that would be the woody biomass fuel consumed by a CHP plant. A long-term sales agreement has been identified by AP&T as being a critical element in the development of commercial CHP plant in Tok. While it is expected that such an agreement can be reached between AP&T and DOF the terms of this contract will not be known until sometime next year at the earliest. Final Report and Recommendations • The final feasibility report was completed and submitted to the AEA in the second week of December.