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HomeMy WebLinkAboutAEA Board Meeting Minutes Feb 8 2024Alaska Energy Authority BOARD MEETING MINUTES Thursday, February 8, 2024 Anchorage, Alaska 1. CALL TO ORDER ALASKA ENERGY AUTHORITY Chair Pruhs called the meeting of the Alaska Energy Authority to order on February 8, 2024, at 2:00 pm. A quorum was established. 2. ROLL CALL BOARD MEMBERS Members present: Chair Dana Pruhs (Public Member); Vice -Chair Bill Kendig (Public Member); Albert Fogle (Public Member); Julie Sande (Commissioner DCCED); Adam Crum (Commissioner DOR (joined at 2:02 pm)); Bill Vivlamore (Public Member); and Randy Eledge (Public Member). 3. AGENDA APPROVAL MOTION: A motion was made by Mr. Fogle to approve the agenda. Motion seconded by Vice -Chair Kendig. The motion to approve the agenda passed without objection. 4. PUBLIC COMMENTS (2 minutes per person) There were no members of the public online or in -person who requested to comment. S. NEW BUSINESS A. Resolution No. 2024-03 Rural Energy Infrastructure Executive Director and Secretary -Treasurer Curtis Thayer noted that Tim Sandstrom, AEA, was scheduled to present on this item, but he is in Juneau testifying on the Governor's bill. Mr. Thayer reviewed Resolution No. 2024-03 regarding Rural Energy Infrastructure. The resolution highlights the strategies and opportunities contained within the Governor's Alaska Energy Security Task Force report. Chair Pruhs advised that the draft resolution paperwork in the Board packet is entitled Resolution No. 2024-Ox, but the final draft will be revised to Resolution No. 2024-03. Mr. Eledge asked for the estimated cost to implement the resolution. Mr. Thayer acknowledged that the total amount of deferred maintenance in rural Alaska is $1.1 billion. However, this resolution is not asking for that amount. The Governor has money in the budget for both rural powerhouses and bulk fuel and there is additional federal matching dollars available. • •AKENERGYAUTHORITY.ORG 813 W Northern Lights Blvd, Anchorage, AK 99503 - Phone: (907) 771-3000 - Fax: (907) 771-3044 • Email: info@akenergyauthority.org MOTION: A motion was made by Vice -Chair Kendig to approve Resolution No. 2024-03. Motion seconded by Mr. Fogle. A roll call was taken, and the motion to approve Resolution No. 2024-03 passed unanimously. 6. OLD BUSINESS — None It was noted for the record that the word "None" after Item 6. is an error. A. Resolution No. 2024-02 Providing for Amendments to Resolution 2022-07 Mr. Thayer explained that this action was delayed at the previous meeting while awaiting a memo from Department of Law, in which Law deemed the HVDC line is required project work. The 17- page memo is attorney/client privileged and has been provided to Board members. Mr. Thayer discussed that the memo identified four components that are required: 1) an affirmative vote of the Bradley Lake Management Committee (BPMC), 2) an affirmative vote of the AEA Board, 3) a third -party opinion, and 4) bondholder approval. Mr. Thayer discussed that the resolution relates to the December 2022 bonding for required project work associated with Bradley Lake of $156 million. At the time of the bonding, the HVDC project work was not considered. The GRIP grant funding received that relates to the HVDC line requires a $206.5 million State match. It has been determined that a portion of the required project work funding could be used toward the match. The last Whereas in Resolution No. 2024-02 expands the Bradley Lake project to include the underwater HVDC transmission line and limits the bond funding to no more than $20 million for the underwater HVDC transmission line and other approved projects of the Department of Energy. Section 1 includes the same expansion.'Mr. Thayer explained how the $20 million amount was determined and that the State match would then be reduced to $186.5 million. Mr. Thayer noted that Les Krusen and David Grossklaus are on the line to answer questions. Mr. Krusen was AEA's bond counsel on the original required project work bond and the counsel with the Department of Law on their opinion. Mr. Grossklaus is AEA's external counsel related to GRIP transmission and activities. Mr. Eledge asked for an update on the status of the three other required components. Mr. Thayer indicated that last Friday, the BPMC approved their resolution to move forward. He stated that the third -party opinion was received and supportive. The opinion is included within the Board member's public packet. The bondholder's approval will be conducted after AEA's affirmative vote. Mr. Eledge asked if the HVDC line is bidirectional. Mr. Thayer requested Jim Mendenhall, AEA, to answer. Mr. Mendenhall agreed, the line is bidirectional. Chair Pruhs asked if the $20 million covers the immediate cash flow for the foreseeable future. Mr. Alaska Energy Authority Page 2 of 3 Thayer stated the amount will provide cash flow for this year's activities beginning in the spring and into the second year. Chair Pruhs asked if it is known when the reimbursement of the grant dollars will occur. Mr. Thayer explained that the finalization of the grant agreement is underway and the agreement will identify the reimbursement specifics of the dollar -for -dollar grant. No funds will be spent until the grant agreement is finalized. Chair Pruhs asked if the State must pay back all federal funding if for some reason the project does not get completed. Mr. Thayer indicated the grant agreement that is currently being drafted is expected to contain a clawback provision in which the State would have to reimburse the federal funding that is not spent. Chair Pruhs commented on the size of the $206 million commitment and asked if AEA and Mr. Thayer have the authorization to sign on behalf of the State for the agreement. Mr. Thayer indicated that before the grant agreement is signed, it will be reviewed by legal counsel to confirm its alignment. Chair Pruhs asked if the Board needs to review the finalized grant agreement before it is signed. Commissioner Crum explained that the finalized grant agreement will come to the Board for consideration and feedback prior to submittal to the Governor's Office for approval. Mr. Mendenhall noted that the finalized grant agreement will be ready for review sometime after the March 61h Board meeting. He explained that there is a mechanism contained within the agreement for submittal and approval of prior spent money before the full Department of Energy award is made. There were no additional questions. MOTION: A motion was made by Vice -Chair Kendig to approve Resolution No. 2024-02. Motion seconded by Mr. Fogle. A roll call was taken, and the motion to approve Resolution No. 2024-02 passed unanimously. 7. Next Regularly Scheduled AEA Board Meeting Wednesday, March 6, 2024 8. BOARD COMMENTS Chair Pruhs expressed appreciation to all for attending and reviewing these important resolutions. A member echoed the comments of appreciation to staff for their efforts in preparation for this meeting. 9. ADJOURNMENT There being no further business of the Board, the AEA meeting adjourrned at 2:29 pm. ERG Y '10 �v � 9 QRgT� � - = Q : SEAL Curtis W. Thayer, Secretary = d Alaska Energy Authority Page 3 of 3