HomeMy WebLinkAboutAEA Bradley Lake Project Management Committee Meeting January 23, 2015 Minutes12.
13.
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
REGULAR MEETING
AGENDA
Friday,January 23,2015
9:30 a.m.-11:30 a.m.
Alaska Energy Authority's Board Room
813 West Northern Lights Boulevard,Anchorage,AK
To participate by teleconference,dial 1-888-585-9008 and use code 467 050 126.
CALL TO ORDER
ROLL CALL (for Committee members)
PUBLIC ROLL CALL (for all others present)
AGENDA COMMENTS /MOTION FOR APPROVAL
PUBLIC COMMENTS
APPROVAL OF MEETING MINUTES -Nov.17,2014
NEW BUSINESS
A.2014 Audit report and approval of refund (Action item)Budget Committee
B.FY15 First Quarter report
C.FY16 Preliminary Budget
D.Battle Creek update
E.EPS -PSSE modeling
F.Update on dispute resolution decision process
G.Update on compliance to Resolution 2014-03
(Adoption of Railbelt Reliability Standards)
COMMITTEE REPORTS
OPERATORS REPORT
COMMITTEE ASSIGNMENTS
MEMBERS COMMENTS
NEXT MEETING DATE -TBD
ADJOURNMENT
Budget Committee
Alan Owens
Bryan Carey
Alan Owens
Cory Borgeson
O&D committee
Bradley Lake Project Management Committee
Friday,January 23,2015 @ 9:30 A.M.
""PLEASE WRITE LEGIBLY**
NAME ORGANIZATION
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ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY
BOARD MEETING
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Roll call from top to bottom ending with Chair
Yes No Yes No Yes No Yes No ;Yes No
Homer Electric Association
Matanuska Electric Association
City of Seward
Alaska Energy Authority
Municipal Light &Power
Chugach Electric Association
Golden Valley Electric Association
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Bradley Lake Project Management Committee Meeting -Alaska Online Public Notices Page 1 of 1
STATUS:Active
Bradley Lake Project Management Committee Meeting
ALASKAENERGY AUTHORITY (AEA)
Regular Meeting
Bradley Lake Project Management Committee
Notice is hereby given that theBradley Lake Project Management Committee will hold a regular meeting on Friday,January
23,2015 at 9:30 a.m.For additional information contact Teri Webster at 907-771-3074.
This meeting will be conducted by electronic media pursuant to AS 44.62.310 at the following location:
Alaska Energy Authority BoardConference Room,813 West Northern Lights Boulevard,Anchorage,Alaska;A
teleconference line has been set up for those unable to attend in person.Dial 1-888-585-9008,Enter Code 467-050-126#.
The public is invited to attend.The State of Alaska (AEA)complies with Title Il of the Americans with Disabilities Act of
1990.Disabled persons requiring specialmodifications to participate should contact AEA staff at (907)771-3074 to
makearrangements.
"Attachments,History,Details
Attachments Details
None Department:Commerce Community andP.Economic Development
Revision History Category:Public Notices
Created 1/16/2015 8:57:52 AM by OY acvisory Committee MeetingtawebsterDO
Modified 1/16/2015 8:58:19 AM by [Details]Project/Regulation #:
tawebster
ifj 59:Publish Date:1/16/2015Modified1/16/2015 8:59:24 AM by [Details]ublis /16/
tawebster Archive Date:1/24/2015
Events/Deadlines:
http://aws.state.ak.us/OnlinePublicNotices/Notices/View.aspx?id=175321 1/16/2015
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE.
REGULAR MEETING
AGENDAFriday,J anuary 23,2015...
9:30 a.m.-11:30 a.m.
Alaska Energy Authority's Board Room
813 West Northern Lights Boulevard,Anchorage,AK
To participate by teleconference,dial 1-888-585-9008 and use code 467 050 126.
CALL TO ORDER
|
ROLL CALL (for Committee members)
PUBLIC ROLL CALL (for all others present)
AGENDA COMMENTS /MOTION FOR APPROVAL
PUBLIC COMMENTS
APPROVAL OF MEETING MINUTES -Nov.17,2014
NEW BUSINESS
A.2014 Audit report and approval of refund (Action item)Budget Committee "A
B.FY15 First Quarter report Budget Committee
C.FY16 Preliminary Budget Alan Owens
Battle Creek update Bryan Carey
EPS -PSSE modeling Alan Owens
F.Update on dispute resolution decision process Cory Borgeson
Ned agendaG.poate of compliance to Resolution 2014-03
(Adoption of Railbelt Reliability Standards)O&D committee
releane opiratoc SOS OVE JZowL05 70 GroupCOMMITTEEREPORTS
OPERATORS REPORT
COMMITTEE ASSIGNMENTS
MEMBERS COMMENTS
NEXT MEETING DATE -TBD
ADJOURNMENT
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MATANUSKA ELECTRIC ASSOCIATION
January 21,2015
Cory Borgeson
Chairman,BPMC
Golden Valley Electric Association
P.O.Box 71249
Fairbanks,Alaska 99707-1249
Subject:Soldotna and Dave's Creek Static VAR compensators
a In May 2014 ABB Inc.conducted a survey of the Dave's Creek and Soldotna(0?Poier Or Static VAR compensators (SVCs).The Bradley O&D committee has review the
resulting report and believes that further investigation of ABB's recommendation
be conducted.
Of concern is the 'ack of spare parts,the loss of ABB's competency to supportthisequipmentandextendedoutageswhichmightbeincurredwithafailureof
theses systems.A failure has the potential to leave the export of Bradley poweroffofthepeninsulalimitedtooneunit's output from Bradley Lake.
werobe,A replacement of the system would be a $7.2M dollar expense over a two yearroenSeperiodbasedontheinitialestimateprovided.We believe at this time that thegarelikelyrecommendationwouldbeatotalsystemreplacementhoweverweare not
prepared to make a formal recommendation without further study.ux |:su?As the value of the dollar appears to have improved favorable against the SwissferoiKronatheO&D committee recommends we solicit a new proposal from ABB.
UU option!Regards,;aM Fubluparade.'ZL.
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Chairman,Bradley Lake O&D Committee
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MATANUSKA ELECTRIC ASSOCIATION,INC.»P.O.Box 2929 «Palmer,Alaska 99645 «t 907.745.3231 +f 907.761.9368 »www.mea.coop
Bradley Lake BPMC
January 23rd,2015
Operators Report
Unit Statistics:
Generation Unit 1 (MWhrs)Unit 2 (MWhrs)Total (MWhrs)
November 2014 11,011 26,123 37134.
December 2014 19,684 25,440 45,124
Hydraulics Avg.Lake Level (ft)Usage (ac ft)Fishwater (ac ft)
November 2014 1,165 36,581 2,006
December 2014 1,158 44,795 1,899
Lake Level -Jan.20 -1,150.6'
Large Projects:
1)Governor PLC Replacement Final -The project is under-budget.
2)
a.Testing and commissioning of the Emerson governor controls was completedonAugust22".No unit trips or control incidents have occurred in 5 months
of operation.
b.EPS completed and submitted the final Bradley Lake PSSE model to HEA for
storage on the PSSE site.HEA has received the final billing of $71,021 for PSSE
revisions and final commissioning.With authorization from the BPMC to pay
this final invoice,all outstanding work associated with the governor control
installation and the PSSE model will be closed.
c.Bradley governor and rail-belt system operation will be monitored and tracked
during future system disturbances.If any circumstances arise that may require
additional governor or PSSE modifications,they will be dealt with on a case by
case basis.
Unit #1 Nozzle Oil Leak -Unit #1,nozzle #4,hydraulic oil leakage has not
changed significantly following the unit #1 de-rate to 38MW.
a.Repair Parts -O-rings,seals,and hard parts (e.g.bushings,and piston rings}
have been ordered to repair the nozzles on both units.Fourteen (14)sets of
parts were ordered.This will allow all 13 nozzies to be rebuilt and will allow
for one extra set that can be utilized and measured for future repairs.There is
an 18 week lead time for parts which should put the delivery date in the 1*
part of May.
Bushings and piston rings -$97,123 (ordered)
Seals and O-rings -approx.$9,000 (ordered)
Additional tips -$150,000,(pending,note:budget section,page 3,item 3c)
b.Schedule -The O&D Committee recommended that outages for nozzle repair
be scheduled in conjunction with CEA tietine outages.If nozzle condition does
not deteriorate,the tentative nozzle repairs will be scheduled as follows:
Bradley Unit #1 Nozzle Refurbish -7/6 to 8/7 (33 days)
Bradley Unit #2 Nozzle Refurbish -10/12 to 11/13 (33 days)
Bradley Lake Operator Report Page 1
Large Projects (continued):
3)Fishwater Screen Debris Removal -It is recommended by the O&D committee
that this project be postponed until Spring of 2016.Lake level cannot be reduced
sufficiently in the next few months without spilling water through the diversion
tunnel.Spilling water is not a cost effective or safe alternative.Money Budgeted
for this project in FY2015 will be carried over to the FY2016 budget.
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4)Bradley Junction Switch Removal -This project has been on hold while the O&D
Committee reviewed the IMC standards to determine if the Bradley Lake PowerProjectwasexemptfromthestandards.On January 9"The O&D Committee
recommended this project move forward.HEA transmission managers were
notified and will make all effort to complete this project in FY2015.
Bradley Lake Operator Report Page 2
Budget FY2016 -A preliminary Bradley Lake budget was provided to the O&D
Committee and the Budget Sub-committee on January 9th.A general overviewofHEA's portion of the Bradley budget is shown below.
1)FY2016 O&M Budget The preliminary budget estimate for FY2016 is projectedtobelessthan1%increase over FY2015.
2)FY2016 Transmission The preliminary budget estimate for FY2016 is projected
to be approximately 10%decrease from FY2015.
3)FY2016 Capital Projects -approximately equal to FY2015 including addition of 6
nozzle tips in item 3c.
a.Fire system replacement and upgrade --This project will be conducted in two
phases.Part in FY2015 and completed in FY2016.
Phase 1-Install a gasous type fire suppression system in the Bradley Lake
Engineering room,and replace the Halon fire system in the control room due
to a leaking bottle on the reserve system.Use the existing Halon bottle for
spare on generator systems.
Phase 2-Design and provide bids to replace the original Bradley Lake fire
system control cabinets and alarm panels.
FY2015 -$290,000 carry forward any remaining amountEYZ0TGS$60,000
C kGpne re b.Fishwater debris removal project -5%Sd gE is ad 1068yenSer-Remaining FY2015 budget amount of $703,070 will be carried over to FY2016.Ag emeel No additional money added to FY2016 budget.Sonar Stinvey Only CoveTy@g%s dul stu lashing @othe epliond Can,access vol heavy eq wer,"Drain laYe.wear or"c.Turbine Novzle Repair and Refurbish-FY2016weWnOJPaton[reusing someorethe existing'tips,$280,000 (six nozzle tips in stock).ne ewlgrerh -Gbtion 2'<feplace ail :009 [additional cost =$150,000)
uveOpen'Unit #1 -$490,000 -Includes labor and machine cost.uw hyde ke lew.
Unit #2 -$490,000 -Includes labor and machine cost,add $150,000 new tips.
Note Option 2:Still in negotiation with Voith Hydro for nozzle tip cost estimate
We have 6 tips in stock.May be able to reuse some of the existing tips.Cost for 6 additional tips in 2003 was ($25,000 each X 6 =$150,000).
Bute Volt Brdaet Har Steven Cannon CEADwdswad
Bradley Lake Operator Report Page 3
_ATTENDANCE -BPMC REGULARMEETING,Jan 23,2015 @ 9:30 am_-COMMITTEEMEMBERS ALTERNATEvw'Cory Borgeson,Chair :/-GVEA ;'Lynn Thompson /:
i OWRD Brad Evans,Vice Chair -Vv CEA Burke Wick OO -_
|-'Brad Janorschke |y HEA -Harvey Ambrose :
|/Sara Fisher-Goad,Secretary/Treasurer J AEA BryanCarey
|S doe Griffith -MEA ||GaryKuhn |
dim Trent JS)MLP Richard Miller
lwJohn Foutz |SEW |Jeff Estes :7
_-Public Members }COUNSEL .
7 a :Po Wel FF -:Kirk Gibson,McDowell Rackner &Gibson PC;Par teleDelay L |Brian Bjorkquist,Dept of Law
amily Moherison,.Sherine,MAskey Bete eh _
'Sethe Dan 2B akOOTPDPRAWNSdoc.
Bradley Lake Project Management Committee
Friday,January 23,2015 @ 9:30 A.M.
**PLEASE WRITE LEGIBLY**
NAME ORGANIZATION
Financial Statements
|and -
Other Financial Information |
BRADLEY LAKE
PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
Years ended June 30,2014 and 2013
_(With Independent Auditor's Report)
SWALLING &ASSOCIATES
Certified Public Accountants &Business Advisers
Bradley Lake Project Management Committee Meeting
Friday,January 23,2015
Agenda Item:7A-Approval of R&C refund
The FY14 R&C refund of $279,247.28 was reduced by an underpayment from the utilities
in FY11 of $99,459.29 to the R&C fund,for a net R&C refund of $179,787.99 in FY 14.
MOTION:Move that the Bradley Lake Project Management Committee accept
the fiscal year 2014 Audit Report and approve a refund of
$1,314,173.86 ($1,134,385.87 O&M and $179,787.99 R&C)to the
utilities.
Move:
-Second:
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
Financial Statements and Other Financial Information
Years ended June 30,2014 and 2013
Contents
Page
Independent Auditor's Report 1-2
Statements of Assets and Liabilities 3
Statements of Revenues and Expenses 4
Statements of Cash Flows 5
Notes to Financial Statements 6-11
Independent Auditor's Report on Other Financial Information 2
Statements of Expenses 13
SWALLING &ASSOCIATESPC
Certified Public Accountants &Business Advisers
INDEPENDENT AUDITOR'S REPORT
Bradley Lake Project Management Committee
Anchorage,Alaska
We have audited the accompanying special-purpose financial statements of the Bradley Lake
Project Management Committee (a project management committee)Operating and Revenue
Funds,which comprise the special-purpose statements of assets and liabilities as of June 30,
2014 and 2013,and the related special-purpose statements of revenues and expenses and special-
purpose statements of cash flows for the years then ended,and the related notes to the financial
statements.
Management's Responsibility for the Financial Statements
The Bradley Lake Project Management Committee is responsible for the preparation and fair
presentation of these special-purpose financial statements in accordance with the accounting
requirements of the Operating and Revenue Funds established under the Alaska Energy
Authority Power Revenue Bond Resolution as described in Note A.The Bradley Lake Project
Management Committee is also responsible for the design,implementation,and maintenance of
internal control relevant to the preparation and fair presentation of financial statements that are
free from material misstatement,whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these special-purpose financial statements based on
our audits.We conducted our audits in accordance with auditing standards generally accepted in
the United States of America.Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements.The procedures selected depend on the auditor's
judgment,including the assessment of the risks of material misstatement of the financial
statements,whether due to fraud or error.In making those risk assessments,the auditor
considers internal control relevant to the entity's preparation and fair presentation of the financial
statements in order to design audit procedures that are appropriate in the circumstances,but not
for the purpose of expressing an opinion on the effectiveness of the entity's internal control.
Accordingly,we express no such opinion.An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of significant accounting estimates made by
management,as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.
3201 C Street,Suite 405 .Anchorage.Alaska 99503eeeningTinegad'husiness.advisers Ph 907.563.7977 -Fax 907.561.7683 -www.swallingcpas.com
Bradley Lake Project Management Committee
Opinion
In our opinion,the special-purpose financial statements referred to above present fairly,in all
material respects,the assets and liabilities of the Bradley Lake Project Management Committee
Operating and Revenue Funds as of June 30,2014 and 2013,and the revenues and expenses,and
cash flows for the years then ended,on the basis of accounting described in Note A.
Basis of Accounting.
We draw attention to Note A of the special-purpose financial statements,which describes the
basis of accounting.The financial statements are prepared on the basis of the accounting
requirements of the Operating and Revenue Funds established under the Alaska Energy
Authority Power Revenue Bond resolution,as discussed in Note A,which is a basis of
accounting other than accounting principles generally accepted in the United States of America,
to comply with accounting requirements of the bond resolution referred to above.Our opinion is
not modified with respect to that matter.
Restriction on Use
This report is intended solely for the information and use of the Bradley Lake Project
Management Committee and is not intended to be and should not be used by anyone other than
this specified party.
Fealling f Qsaccully PC.
Anchorage,Alaska
December 11,2014
.BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
June 30,2014 and 2013
2014 2013
ASSETS
Current assets:
Investments (Note B)$2,277,717 $1,466,992
Due from R &C Fund (Note A)279,247 .767,078
Other receivable (Note A)25,865 2,150
Prepaid expense 6,205 5,640
Total assets $_2,589,034 $2,241,860
LIABILITIES
Current liabilities:
Due to AEA (Note D)$91,502 $305,117
Accounts payable 1,083,899 905,331
Payable to utilities -O &M (Note E)1,134,386 264,334
Payable to utilities --R &C refund (Note A)279,247 767,078
Total liabilities $2,589,034 $_2,241,860
See accompanying notes to the financial statements.
3
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS |
STATEMENTS OF REVENUES AND EXPENSES
Years ended June 30,2014 and 2013
2014
Variance
Favorable 2013
Budget Actual (Unfavorable)Actual
Revenues:
Utility contributions,
net of surplus refund $16,855,124 $16,260,994 $(594,130)$16,176,157
Interest receipts 2,217,900 1,879,404 (338,496)1,936,516
State Renewable Energy ---477,363
Total revenue 19,073,024 18,140,398 (932,626)18,590,036
Expenses,fixed asset
replacements,transfers
and debt service:
Operations and maintenance 6,156,744 5,505,175 651,569 5,070,732
Debt service 12,104,950 12,104,950 -12,107,950
Arbitrage transfer 290,000 292,694 (2,694)296,812
Fixed asset replacements 475,500 193,549 281,951 554,627
Battle Creek -State ---477,363
Interfund transfer 45,830 44.030 1,800 82,552
Total expenses,fixed
asset replacements,
transfers and debt
service 19,073,024 18,140,398 932.626 18,590,036
Excess of revenues over
expenses,fixed asset
replacements,transfers
and debt service $-§$-§-§-
See accompanying notes to the financial statements.
4
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
STATEMENTS OF CASH FLOWS
Years ended June 30,2014 and 2013
Cash flows from operating activities:
Excess of revenues over expenses,
fixed asset replacements,transfers
and debt service
Adjustments to reconcile excess of revenues
over expenses,fixed asset replacements,
transfers and debt service to net cash provided
by (used in)operating activities:
Decrease in receivables
Increase in prepaid expense
Decrease in amounts due to AEA
Increase (decrease)in accounts payable
Increase (decrease)in payable to utilities
Decrease in R &C refund
Net cash provided by (used in)
operating activities
Available cash and cash equivalents,beginning of year
Available cash and cash equivalents,end of year
Supplemental disclosure of cash flows information:
Interest paid
See accompanying notes to the financial statements.
5
2014 2013
$-$-
464,116 4,670
(565).
(213,615)(84,689)
178,568 (2,732)
870,052 (530,404)
(487,831)(6,820)
810,725 (619,975)
1,466,992 2,086,967
$2,277,717 $1,466,992
$4,588,950 $5,014,350
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
NOTES TO FINANCIAL STATEMENTS
June 30,2014 and 2013
NOTE A:SIGNIFICANT ACCOUNTING POLICIES
Description of Business:The Bradley Lake Project Management Committee (the Committee)
was established pursuant to Section 13 of the Agreement for the Sale and Purchase of Electric
Power (Power Sales Agreement)dated December 8,1987.The purpose of the Committee is to
arrange for the operation and maintenance of the Bradley Lake Hydroelectric Project (the
Project),which became operational in September 1991,and the scheduling,production and
dispatch of power.The members of the Committee include the Alaska Energy Authority (AEA)
and the five purchasers under the Power Sales Agreement -Chugach Electric Association,Inc.;
Golden Valley Electric Association,Inc.;the Municipality of Anchorage (Municipal Light &
Power);the City of Seward (Seward Electric System);and the Alaska Electric Generation &
Transmission Cooperative,Inc.(AEG&T).AEG&T assigned its rights pertaining to Homer
Electric Association,Inc.(HEA)under the Power Sales Agreement to Alaska Electric and
Energy Cooperative,Inc.(AE&EC)in 2003.HEA and the Matanuska Electric Association,Inc.
(MEA)are additional parties to the Power Sales Agreement but are included as power purchasers
for purposes of representation while AEG&T and AE&EC have no direct vote as a consequence
of the individual representation of HEA and MEA.
Section 13 of the Power Sales Agreement delineates other Committee responsibilities,including:
establishing procedures for each party's water allocation,budgeting for annual Project costs and
calculating each party's required contribution to fund annual Project costs.Committee approval
of operations and maintenance arrangements for the Project,sufficiency of the annual budgets
and wholesale power rates and the undertaking of optional Project work requires a majority
affirmative vote and the affirmative vote of AEA.
The Power Sales Agreement extends until the later of:1)50 years after commencement of
commercial operation or 2)the complete retirement of bonds outstanding under the AEA Power
Revenue Bond Resolution along with the satisfaction of all other payment obligations under the
Power Sales Agreement.Renewal options for additional terms exist.
During the years ended June 30,2014 and 2013,approximately $570,000 and $2,500,000,
respectively,of capital additions occurred relating to the Battle Creek Diversion project to
enhance the Bradley Lake Hydroelectric Project.The funding for this project comes from State
appropriations and the Bradley Lake R &C Fund.This project will divert the upper part of
Battle Creek into Bradley Lake and the increase in water will enable the Project to produce an
additional annual average of 37,000 MW-hrs.(nearly a 10%increase in Bradley Lake's annual
energy).Diversion engineering is in final design and various environmental studies are ongoing.
An amendment to the Bradley Lake Hydroelectric Project Federal Energy Regulatory
Commission license is expected in 2015 with construction completed in the fall of 2017.
.BRADLEY LAKE PROJECT MANAGEMENT COMMITTEEOPERATINGANDREVENUEFUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
June 30,2014 and 2013
NOTE A:SIGNIFICANT ACCOUNTING POLICIES (Continued)
Establishment of Trust Funds:Article V,Section 502 of the Alaska Energy Authority's Power
Revenue Bond Resolution established a Revenue Fund and an Operating Fund,including an
Operating Reserve account,to be held by AEA.In actuality these funds,along with the Debt
Service,Excess Investment Earnings (arbitrage),and various construction funds related to the
Bradley Lake Hydroelectric Project are all held by the Corporate Trust Department of US BankinSeattle,Washington.
All deposits,including utility contributions and interest transferred from other funds,are made
into the Revenue Fund,which transfers amounts approximately equal to one-twelfth of the
annual operating and maintenance budget into the Operating Fund on a monthly basis.
Additional transfers are made from the Revenue Fund to the Debt Service Fund in order to
satisfy semiannual interest payments and annual principal payments on the Project's outstanding
bonds payable.
Interest earnings available for operations and maintenance are derived from the following funds:
Debt Service Fund;Operating Reserve Fund;Operating Fund;Revenue Fund;Capital Reserve
Fund;and the Renewal &Contingency Fund when the fund balance is $5,000,000 or greater.
Revenue and Expense Recognition:Utility contributions are recognized as revenue when due to
be received under the terms of the Power Sales Agreement.Transfers from other funds are
recognized when the transfer is made and interest earnings are recognized when received.
Operating and maintenance expenses are recognized when incurred,while transfers to Debt
Service Fund and Excess Earnings Funds are recognized when the transfer is made.Purchases of
fixed asset replacements are expensed when purchased.The Operating Fund reimburses the
Renewal and Contingency Reserve Fund (R &C Fund)for capital costs over a four year period.
Transfers to the R &C Fund for repayment of funds withdrawn for capital costs occur monthly
based on the budgeted R &C expenditures.At year end the actual Operating Fund and R &C
Fund expenses are compared to the actual revenue and a refund is given to the utilities when a
surplus of revenues occurs or invoices are issued to the utilities if expenses exceed revenues.At
June 30,2014,the R &C Fund surplus to be refunded was $279,247,resulting in a net balance
due to the R &C Fund of $1,984,283.The net balance due to the R &C Fund at June 30,2013was$372,249.
Estimates:The preparation of the special-purpose financial statements of the Operating and
Revenue Funds requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses during the reporting
period.Actual results could differ from those estimates.
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE |OPERATING AND REVENUE FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)June 30,2014 and 2013
NOTE A:SIGNIFICANT ACCOUNTING POLICIES (Continued)
Income Taxes:The Bradley Lake Project Management Committee is exempt from income
taxation under Section 501 (a)of the Internal Revenue Code.Therefore,the Committee had no
deferred tax liabilities or assets or tax carryforwards as of June 30,2014 and 2013 and no currentordeferredtaxexpensefortheyearsthenended.
NOTE B:INVESTMENTS
Substantially all of the balances in the following funds are invested in collateralized investment
agreements with JP Morgan Chase Bank through the trust department of US Bank.The specified
interest rate for monies from the Operating and Revenue Funds invested in the agreements is
7.38%per annum.Balances at June 30,2014 and 2013 are as follows:
014 ;201
Operating Fund $1,599,575 °$1,310,642
Revenue Fund ;678,142 156,350
Total investments $2.277.717 $1,466,992
Investments are sold as needed to cover operating requisitions submitted to the trustee and are
therefore considered to be short-term and available for sale.Investments are presented at
aggregate cost.
-For purposes of the cash flow statements,management considers the full amount of the
investment balance to be cash available for operations.
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
June 30,2014 and 2013
NOTE C:MAJOR CONTRACTS AND AGREEMENTS
During May 1994,the Alaska Energy Authority entered into the Master Maintenance and
Operating agreement with the Committee.The purpose of the agreement is to establish contract
administration and budgeting procedures for maintenance and operation contracts of the Bradley
Lake Hydroelectric Project and to provide for the lease or other use of facilities and equipment in
a manner consistent with the requirements of the Power Sales Agreement.The term of the
Master Agreement is indefinite,remaining in effect until termination of the Power Sales
Agreement or until AEA no longer legally exists.This agreement authorizes AEA to enter into
any contracts necessary to perform operating or maintenance-type services to the Project,subject
to the approval of the Committee.
On behalf of the Committee,the AEA entered into an agreement with Chugach Electric
Association,Inc.(CEA)in August 1996,for the provision of all services necessary to dispatch
the Project's electric power output.The dispatch agreement runs concurrently with the wheeling
and related services contract entered into by and among the parties to the Power Sales Agreement
in December 1987 and remains in effect for the term of the wheeling agreement unless CEA
ceases to be the output dispatcher.
In August 1996,the Alaska Energy Authority entered into an agreement with CEA on behalf of
the Committee for the provision of maintenance services for the Daves Creek and Soldotna SVC
Substations.
An operation and maintenance agreement dated February 11,1994,was executed between
Homer Electric Association,Inc.and the Alaska Energy Authority.This agreement provides for
the operation and maintenance of the Bradley Lake Hydroelectric Project by Homer Electric
Association,Inc.The agreement,as amended effective July 1,2008,is through June 30,2013
and automatically continues in successive five year terms thereafter unless terminated by either
party as set forth in the amended agreement.Generally,to avoid an automatic,successive five
year term extension,notice of termination by either party must be given two years in advance of
the termination date.HEA is to be reimbursed for costs associated with the operation,
maintenance and repair of the Project as determined in advance through the submission of an
annual budget based upon prudent estimates and anticipated operation and maintenance costs.
In August 1996,the agreement was amended to separate the maintenance of the transmission
facilities from the hydroelectric project.The transmission agreement continues from year to
year,except upon written notice to terminate by either party.Notice of termination must be given
six months in advance of termination dates.In June 1999,the transmission agreement was again
amended to require HEA to provide communication services in addition to the other services.
-BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
June 30,2014 and 2013
NOTE D:RELATED PARTY TRANSACTIONS
During the years ended June 30,2014 and 2013,costs incurred under the various contracts with
related parties described in Note C were as follows:
014 201
Homer Electric Association,Inc.-operation,
maintenance,communications and fixed
asset replacements $2,719,792 $2,627,680
Chugach Electric Association,Inc.-substation
service maintenance $344,042 $316,805
Alaska Energy Authority -administrative fees $200,000 $200,000
For the years ended June 30,2014 and 2013,Chugach Electric Association,Inc.provided
dispatch services to the Committee at the agreed upon amount which is zero.
Amounts payable to related parties at June 30,2014 and 2013 were as follows:
201 013
Included in accounts payable:
Homer Electric Association,Inc.$609,243 $499,683
Chugach Electric Association,Inc.$213,204 $16,281
Due to others:
Alaska Energy Authority -short-term
borrowings for vendor payments $91,502 $305,117
NOTE E:SURPLUS REFUND AND UTILITY CONTRIBUTIONS RECEIVABLE
The $264,334 surplus at June 30,2013 was refunded to member utilities in fiscal year 2014
pursuant to the Power Sales Agreement and direction of the Committee.
At June 30,2014,a surplus of $1,134,386 will be refunded to member utilities in fiscal year
2015 pursuant to the Power Sales Agreement and direction of the Committee.
10
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE -OPERATING AND REVENUE FUNDS.
NOTES TO FINANCIAL STATEMENTS (Continued)
June 30,2014 and 2013
NOTE F:RECLASSIFICATIONS
Certain amounts in the prior year financial statements have been reclassified for comparative
purposes to conform with presentation in the current year financial statements.
NOTE G:SUBSEQUENT EVENTS
The Committee has evaluated subsequent events through December 11,2014,the date the
financial statements were available to be issued,and did not identify anything requiring
additional disclosure.
11
SWALLING &ASSOCIATESPC
Certified Public Accountants &Business Advisers
INDEPENDENT AUDITOR'S REPORT ON OTHER FINANCIAL INFORMATION
Bradley Lake Project Management Committee
Anchorage,Alaska
We have audited the special-purpose financial statements of the Bradley Lake Project
Management Committee Operating and Revenue Funds as of and for the years ended June 30,
2014 and 2013,and our report thereon dated December 11,2014,which expressed an
unmodified opinion on those special-purpose financial statements,appears on pages |and 2.
Our audits were conducted for the purpose of forming an opinion on the special-purpose
financial statements as a whole.The supplemental special-purpose Statements of Expenses are
presented for purposes of additional analysis and are not a required part of the special-purpose
financial statements.Such information is the responsibility of the Bradley Lake Project
Management Committee and was derived from and relates directly to the underlying accounting
and other records used to prepare the special-purpose financial statements.The information has
been subjected to the auditing procedures applied in the audits of the special-purpose financial
statements and certain additional procedures,including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the special-
purpose financial statements or to the special-purpose financial statements themselves,and other
additional procedures in accordance with auditing standards generally accepted in the United
States of America.In our opinion,the information is fairly stated in all material respects in
relation to the special-purpose financial statements as a whole.
This report is intended solely for the information and use of the Bradley Lake Project
Management Committee and is not intended to be and should not be used by anyone other than
this specified party.
Funtling EE Aseecutty |PC.
Anchorage,Alaska
December 11,2014
3201 C Street,Suite 405 .Anchorage,Alaska 99503
3 Foe ener seunting tirme ond business.advisers Ph 907.563.7977 -Fax 907.561.7683 -www.swallingcpas.com :
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE
OPERATING AND REVENUE FUNDS
STATEMENTS OF EXPENSES
Years ended June 30,2014 and 2013
2014
Variance
Favorable 2013
Budget Actual (Unfavorable)Actual
Expenses:
Generation expense:
Operation supervision
and engineering $291,804 §$288,827 §$2,977 $247,827
Hydraulic operation 113,512 86,691 26,821 82,269
Electric plant operation 324,401 273,191 $1,210 283,620
Hydraulic power
generation operation 631,124 421,572 209,552 347,507
FERC land use fees 175,000 179,565 (4,565)132,158
Structure maintenance 354,283 307,418 46,865 345,860
Reservoir,dam,and
waterway maintenance '78,409 22,289 -56,120 139,872
Electric plant maintenance 426,894 342,659 84,235 330,064
Hydraulic plant maintenance 168,081 134,596 33,485 196,120
System control and load dispatching 439,254 346,819 92,435 355,710
Substation operation
and maintenance 161,274 344,042 (182,768)316,905
Overhead line maintenance 563,697 191,080 372,617 26,562
Total generation expense 3,727,733 2,938,749 788,984 2,804,474
Administrative,general and
regulatory expense:
Insurance 572,237 519,471 52,766 535,894
AEA administrative fee 200,000 200,000 -200,000
PMC costs 57,700 98,449 (40,749)50,931
Regulatory commission:
FERC administrative fees 200,000 204,998 (4,998)257,840
FERC licensing and study 71,000 181,272 (110,272)79,438
Total administrative,general
and regulatory expense 1,100,937 1,204,190 (103,253)1,124,103
Total operations and
maintenance expenses,
before capital project
reimbursement 4,828,670 4,142,939 685,731 3,928,577
R &C Fund repayment |1,328,074 1,362,236 (34,162)1,142,155
Total operations andmaintenanceexpenses $__6,156,744 $__5,505,175 $651,569 $_5,070,732
13
ALASKA ENERGY AUTHORITY
BRADLEY LAKE HYDROELECTRIC PROJECT
REVENUES,EXPENSES &CHANGES IN SURPLUS
REVENUES
UTILITY CONTRIBUTIONS
INTEREST INCOME
EXPENSES
OPERATIONS
RENEWAL/REPLACE (R&C REPAYMENTS)
R&C INTEREST APPLIED AS REPMT
NON R&C CAPITAL PURCHASES-See A1
TRANSFER TO OPERATING RESERVE
DEBT SERVICE (net of Capital Reserve Reduction)
TRANSFER TO ARBITRAGE
CURRENT YEAR SURPLUS(DEFICIT)
PRIOR YEAR SURPLUS (DEFICIT)
BEGINNING SURPLUS (DEFICIT)
COMMITTED CY EXP &DEBT SVC
ENDING SURPLUS (DEFICIT)
BALANCE SHEET
ASSETS
REVENUE FUND
OPERATING FUND
DUE FROM AEA
RECEIVABLE
PREPAID
LIABILITIES &SURPLUS
CURRENT LIABILITIES
COMMITTED CY EXP &DEBT SVC
PAYABLE TO UTILITIES O&M
PAYABLE TO UTILITIES R&C
OTHER INFORMATION
OPERATING RESERVE
MONTHLY CONTRIBUTIONS
19
FY2014 FY2015 FY2015
ACTUALS APPROVED ACTUALS
BUDGET 9/30/2014
17,674,626.00 17,574,314 4,393,578.00
1,879,404.14 1,451,040 975,140.80
19,554,030.14 19,025,354 5,368,718.80
4,142,938.49 5,630,502 1,503,170.10
1,328,076.00 1,250,318 312,579.00
313,407.18 -119,054.02
193,548.61 140,000 16,703.46
44,030.00 (160,366)160,366.00
12,104,950.00 11,872,900 -
292,693.99 292,000 298,315.68
18,419,644.27 19,025,354 2,410,188.26
1,134,385.87 -2,958,530.54
-:(2,958,530.54)
1,134,386 .-
678,141.70 -3,732,022.21
1,599,575.41 -1,282,636.14
25,865.00 --
6,205.00 -:
2,309,787.11 :5,014,658.35
1,175,401.24 -921,741.98
1,134,385.87 -2,958,530.54
--954,597.80
--179,788.03
2,309,787.11 -5,014,658.35
965,734.00 1,126,100.40 1,126,100.40
1,404,593.67 1,464,526.17 1,464,526.17
ALASKA ENERGY AUTHORITY
BRADLEY LAKE HYDROELECTRIC PROJECT
Schedule A-1
FY14 FY14 FY15 FY15CAPITALPURCHASESNOTFUNDEDBYR&C FUND BUDGET |ACTUALS BUDGET |ACTUALS
Replace Office Furniture 10,000 7,327 --
Telephone/Network Upgrade 20,000 13,457 --
Accusonic Flow Meter Monitoring Unit Replacement -16,422 --
Replace Fish Water Valve Actuators 20,000 -20,000 -
Utility Vehicles 7,500 5,500 --
Replace JEM meters with ION meters -23,154 --
Nuka Diversion Hut 75,000 5,636 --
Weather Stations 15,000 ---
Roof Ice Guards for Main Transfomer 28,000 ---
DCS Security Interface for Data Access 125,000 --16,703
Generator Partial Discharge Monitor 145,000 107,012 --
Surveillance Cameras 30,000 15,040 --
Lube Oil Purification System --46,000 -
Replace 1998 Chevrolet Crew Cab Vehicle --37,000 -
Replace 1990 Ford Single Cab Vehicle --37,000 -
Total Non R&C Capital Purchases 475,500 193,549 140,000 16,703
Budget Items Being Reviewed by O&D FY14 FY14 FY15 FY15
(not approved at this time)PROPOSED]ACTUALS |PROPOSED]ACTUALS
Engineering Work to Design Bradley Junction Substation 300,000
System Studies for Bradley Operation 250,000
Diamond Ridge Breaker Mitigation 160,000
H:\Accounting\AEA FY15 FS Shared Files\Bradley Lake\FY15 Qtr 1.xIsx lof1
ALASKA ENERGY AUTHORITY
BRADLEY LAKE OPERATIONS &MAINTENANCE
SCHEDULE B
.BUDGETTO ACTUALS -QUARTER ENDING 09/30/2014
Budget Line Manager
FY15 Total {Over}Under |FY¥14 APPROVED
Budget HEA Actual |CEA Actual |AEA Actual }Total Actual Budget BUDGET FY14 ACTUAL
s y by expense type
Labor &Benefits 1,686,348 400,838 81,559 :482,397 1,203,952 1,545,880 1,353,077
Travel 11,410 8,527 1,255 :9,782 1,628 11,000 13,838Contractual805,611 68,321 1,915 96,704 166,939 638,672 787,343 587,329
Supplies &Materials 278,919 21,607 4,496 :26,103 252,816 248,919 115,617
Other Costs 2,671,184 20,027 23,132 731,816 774,975 1,896,209 8,500 3,192
Equipment &Machinery 8,500 1,243 ::1,243 7,257 95,790 22,013
Maintenance Projects 168,530 39,331 2,400 -41,731 126,799 2,131,238 2,047,873
$,630,502 559,894 114,757 828,520 1,503,170 4,127,332 4,828,670 4,142,940
FERC 535 -Operation Supervision &Engineering
Operations Sup/Eng
Bradley Lake Operating
Labor &Benefits 291,632 91,641 ::91,641 199,991 268,052 266,237Travel8,610 8,368 ::8,368 242 8,200 11,861
Contractual 9,349 "---9,349 9,349 10,339
Supplies &Materials 6,203 98 :.98 6,105 6,203 390
Bradley Lake Operating Total 315,794 100,107 5 -100,107 215,687 291,804 288,827
FERC 535 -Operation Supervision &Engineering Total 315,794 100,107 ::100,107 215,687 291,806 288,827
FERC 537 -Hydraulic Expenses
Hydraulic Expenses
Bradley Lake Operating
Labor &Benefits 95,056 20,$16 --20,516 74,540 91,400 74,298
Contractual 19,504 -:=:19,504 19,504 11,475
Supplies &Materials 2,608 :*id =2,608 2,608 918
Bradley Lake Operating Total 117,168 20,516 -:20,516 96,652 113,512 86,691
FERC 537 -Hydraulic Expenses Total 117,168 20,516 bd bd 20,516 96,652 113,512 86,691
FERC 538 -Electric Expenses
Electric Expenses
Bradley Lake Operating
Labor &Benefits 224,000 59,472 -=59,472 164,528 197,000 215,857
Contractual 52,169 5,307 ::5,307 46,862 121,169 $7,136
Supplies &Materials 6,232 117 >:117 6,115 6,232 498
Bradley Lake Operating Total 282,401 64,896 :id 64,896 217,505 324,401 273,191
FERC 538 -Electric Expenses Total 282,401 64,896 .:64,896 217,505 324,401 273,191
FERC 539 -Misc.Hydraulic Power Generation Expenses
Misc Hydro Power Exp
Bradley Lake Operating
Labor &Benefits 192,000 29,599 ::29,599 162,401 192,168 75,569
Contractual 239,571 56,763 >:56,763 182,808 224,078 173,600
Supplies &Materials 94,878 3,707 :-3,707 91,171 94,878 53,658
Bradley Lake Operating Total 526,449 90,069 --90,069 436,380 $11,124 302,826
BRADLEY CIRCUITS/RADIO TO BERNICE LK
Other Costs 30,000 7,185 :ba 7,185 22,815 90,000 90,000
BRADLEY CIRCUITS/RADIO TO BERNICE LK Total 30,000 7,185 -:7,185 22,815 90,000 90,000
BRADLEY CIRCUITS BERNICE LK TO ANCH
Other Costs 30,000 .7,187 :7,187 22,814 30,000 28,746
BRADLEY CIRCUITS BERNICE LK TO ANCH Total 30,000 :7,187 -7,187 22,814 30,000 28,746
FERC 539 -Misc.Hydraulic Power Generation Expenses Total 586,449 97,254 7,187 :104,440 482,009 631,124 421,572
FERC 540 -Rents
FERC Land Use Fee
Bradley Lake Operating
Other Costs 180,000 =:::180,000 175,000 179,565
Bradley Lake Operating Total 180,000 -:--180,000 175,000 179,565
FERC $40 -Rents Total 180,000 .--:180,000 175,000 179,565
FERC 541 -Maintenance Supervision &Engineering
Maint Supervision/Eng
Bradley Lake Operating
Labor &Benefits 214,230 61,093 =:61,093 153,137 171,510 206,626
Bradley Lake Operating Total 214,230 61,093 :-61,093 153,137 171,510 206,626
FERC 541 -Maintenance Supervision &Engineering Total 214,230 61,093 --61,093 153,137 171,510 206,626
H:\Accounting\AEA FY15 FS Shared Files\Bradiey Lake\FY1S Qtr 1-xlsx 1oté
ALASKA ENERGY AUTHORITY
BRADLEY LAKE OPERATIONS &MAINTENANCE
SCHEDULE B
BUDGET TO ACTUALS -QUARTER ENDING 09/30/2014
Budget Line Manager
FY15 Total (Over}Under |FY14 APPROVED
Budget HEA Actual |CEA Actual |AEA Actual |Total Actual Budget BUDGET FY14 ACTUAL
FERC 542 -Maintenance of Structures
Maintenance of Structures
Bradley Lake Operating
Labor &Benefits 96,200 20,468 ::20,468 75,732 110,000 74,461
Supplies &Materials 64,273 426 ::426 63,847 64,273 23,138
Equipment &Machinery 8,500 1,243 :-1,243 7,257 8,500 3,192
Maintenance Projects 6,000 :-::6,000 ::
Bradley Lake Operating Total 174,973 22,137 :-22,137 152,836 182,773 100,792
FERC 542 -Maintenance of Structures Total 174,973 22,137 .-22,137 152,836 182,773 100,792
FERC 543 -Maintenance of Reservoirs,Dams &Waterways
Maint Res,Dams,WWays
Bradley Lake Operating
Labor &Benefits 49,950 10,785 :-10,785 39,165 10,750 276
Contractual 28,769 :7 =:28,769 2,769 :
Bradley Lake Operating Total 78,719 10,785 :-10,785 67,934 13,519 276
BRADLEY NUKA REPAIR
Maintenance Projects 21,630 :-::21,630 21,630 463
BRADLEY NUKA REPAIR Total 21,630 :---21,630 21,630 463
BRADLEY POWER TUNNEL MAINT (Dam)
Maintenance Projects 56,000 39,331 --39,331 16,669 43,260 21,550
BRADLEY POWER TUNNEL MAINT (Dam)Total 56,000 39,331 :-39,331 16,669 43,260 21,550
BRADLEY POWER TUNNEL DRAIN CLN/INSP (P/House)
Maintenance Projects 9,000 -:--9,000 --
BRADLEY POWER TUNNEL DRAIN CLN/INSP (P/House)Total 9,000 -:-:9,000 :-
FERC 543 -Maintenance of Reservoirs,Dams &Waterways Total 165,349 50,116 --50,116 115,233 78,409 22,289
FERC 544 -Maintenance of Electric Plant
Maintenance of Elec Plant
Bradley Lake Operating
Labor &Benefits 379,600 86,308 .-86,308 293,292 365,000 317,817
Travel 2,800 158 -=158 2,642 2,800 1,976
Contractual 61,849 2,880 *=2,880 58,969 31,849 7,905
Supplies &Materials 27,245 12,059 :-12,059 15,186 27,245 14,961
Maintenance Projects 25,000 ----25,000 --
Bradley Lake Operating Total 496,494 101,405 :-101,405 395,089 426,894 342,659
FERC 544 -Maintenance of Electric Plant Total 496,494 101,405 ::101,405 395,089 426,894 342,659
FERC 545 -e of Misc.Hydraulic Plant
Maint of Misc Hydr Plant
Bradley Lake Operating
Labor &Benefits 95,680 20,464 ::20,464 75,216 92,000 113,365
Contractual 3,900 170 7 :170 3,730 3,900 -
Supplies &Materials 71,281 §,201 --$,201 66,080 41,281 21,231
Bradley Lake Operating Total 170,861 25,835 ::25,835 145,026 137,181 134,596
BRADLEY FISH WATER OSGN/MIDDLE FORK SHACK IMPR
Maintenance Projects 30,900 ----30,900 30,900 -
BRADLEY FISH WATER OSGN/MIDDLE FORK SHACK IMPR Total 30,900 ---:30,900 30,900 -
FERC 545 -Maintenance of Misc.Hydraulic Plant Total 201,761 25,835 --25,835 175,926 168,081 134,596
FERC 556 -System Control &Load Dispatchin,
System Cntl &Load Disp .
Bradley Lake Operating
Labor &Benefits 48,000 492 ::492 47,508 48,000 8,871Contractual5,000 -::-5,000 35,500 16,131
Supplies &Materials 6,199 -:--6,199 6,199 825
Bradley Lake Operating Total §9,199 492 --492 58,707 89,699 25,827
BRADLEY POWERHOUSE PC'S
Contractual 30,500 3,201 ::3,201 27,289 :-
BRADLEY POWERHOUSE PC'S Total 30,500 3,201 >*3,201 27,299 -:
BRADLEY DISPATCH REGULATIONS
Maintenance Projects 20,000 -:-:20,000 --
BRADLEY DISPATCH REGULATIONS Total 20,000 :::id 20,000 ::
Snow Measurement
Bradley Lake Operating
Other Costs 11,000 ::::11,000 10,130 10,000BradleyLakeOperatingTotal11,000 :---11,000 10,130 10,000
AEA FY15 FS Shared y Lake\FY15 Qtr Lxisx 2of4
ALASKA ENERGY AUTHORITY
BRADLEY LAKE OPERATIONS &MAINTENANCE
SCHEDULE 8
BUDGET TO ACTUALS -QUARTER ENDING 09/30/2014
Budget Line Manager
FY15 Total (Over)Under |FY14 APPROVEDBudgetHEAActual|CEA Actual |AEA Actual |Total Actual Budget BUDGET FY14 ACTUAL
Seismic Service
Bradley Lake Operating
Contractual 60,000 --22,602 22,602 37,398 56,500 51,678BradleyLakeOperatingTotal60,000 .:22,602 22,602 37,398 $6,500 51,678
Streamguaging Serv
Bradley Lake Operating
Contractual 295,000 --74,102 74,102 220,898 282,725 259,065
Bradley Lake Operating Total 295,000 ::74,102 74,102 220,898 282,725 259,065
Permits
Bradley Lake Operating
Other Costs 100 ---a 100 200 250
Bradley Lake Operating Total 100 ----100 200 250
FERC 556 -System Control &Load Dispatching Total 475,799 3,693 -96,704 100,397 375,402 439,254 346,820
FERC 562 -Station Expenses
Station Expenses
Bradley Lake Operating 161,274 344,042
Labor &Benefits --81,559 -81,559 -
Travel :-1,255 -1,255 -
Contractuat ;
--1,915 -1,915 -
Supplies &Materials -:4,496 :4,496 :
Other Costs ::945 :945 :
Maintenance Projects :>2,400 :2,400 -
Bradley Lake Operating Total 488,000 -92,570 °92,570 395,430 161,274 344,042
FERC 562 -Station Expenses Total 488,000 -92,570 :92,570 395,430 161,274 344,042
FERC S72 -Maintenance of Overhead Lines
Maint of OH Lines
Bradley Lake Operating
Other Costs 353,697 -::=353,697 353,697 192,080
Bradley Lake Operating Total 353,697 --*-353,697 353,697 191,080
BRADLEY JUNCTION SWITCH REMOVAL
Other Costs 210,000 ::::210,000 210,000 :
BRADLEY JUNCTION SWITCH REMOVAL Total 210,000 --*:210,000 210,000 :
FERC 571 -Maintenance of Overhead Lines Total 563,697 --.>563,697 563,697 191,080
FERC 920 -Administrative Expense
AEA Bradley Fixed Admin Fees
Bradley Lake Operating
Other Costs 200,000 ::200,000 200,000 -200,000 200,000
Bradley Lake Operating Total 200,000 ::200,000 200,000 -200,000 200,000
Operating Committee Exp-Audit
Bradiey Lake Operating
Other Costs 116,250 ::=a 116,250 15,200 14,750
Bradiey Lake Operating Totat 116,250 -.-:116,250 15,200 14,750
Operating Committee Exp-Legal
Bradley Lake Operating
Other Costs 25,000 .:5,611 5,611 19,389 25,000 68,151
Bradley Lake Operating Totat 25,000 -:5,611 5,611 19,389 25,000 68,151
Operat Committee Exp-Arbitrage
Bradley Lake Operating
Other Costs $,200 -=3,630 3,630 1,570 5,200 3,630
Bradley Lake Operating Total 5,200 ::3,630 3,630 1,570 5,200 3,630
Trust &Account Fees
Bradley Lake Operating
Other Costs 12,300 =:$,959 $,959 6,341 12,300 11,918
Bradley Lake Operating Total 12,300 :-$,959 5,959 6,341 12,300 11,918
FERC 920 -Administrative Expense Total 358,750 -.215,200 215,200 143,550 257,700 298,449
FERC 924 &925 -insurance Premiums
Insurance Premiums
Bradley Lake Operating
Other Costs 574,637 12,842 -498,079 510,921 63,716 509,100 467,453
Bradley Lake Operating Total 574,637 12,842 -498,079 510,921 63,716 509,100 467,453
3of4H:\Accounting\AEA FY15 FS Shared Files\Bradley Lake\FY15 Qtr J.x1sx
ALASKA ENERGY AUTHORITY
BRADLEY LAKE OPERATIONS &MAINTENANCE
SCHEDULE B
BUDGET TO ACTUALS -QUARTER ENDING 09/30/2014
Budget Line Manager
FY15 Total (Over)Under |FY14 APPROVED
Budget HEA Actual |CEA Actual ]AEA Actual }Total Actual Budget BUDGET FY14 ACTUAL
Risk Management
Bradley Lake Operating
Other Costs 35,000 :15,000 :15,000 20,000 63,137 52,018
Bradley Lake Operating Total 35,000 :45,000 :15,000 20,000 63,137 $2,018
FERC 924 &925 -Insurance Premiums Total 609,637 12,842 15,000 498,079 §25,921 83,716 572,237 519,471
FERC 928 -rf yc ion Exp
FERC Admin Fees
Bradley Lake Operating
Other Costs 250,000 -=::250,000 200,000 204,998
Bradley Lake Operating Total 250,000 -::-250,000 200,000 204,998
FERC Related Prof Services
Bradley Lake Operating
Other Costs 150,000 :-18,537 18,537 131,463 71,000 181,272
Bradley Lake Operating Total 150,000 -:18,537 18,537 131,463 71,000 181,272
FERC 928 -AS Pp Total 400,000 a :18,537 18,537 381,463 271,000 386,270
Total Bradley Lake Budget $,630,502 $59,894 114,757 828,520 1,503,170 4,127,332 4,828,670 4,142,940
AEA FY15 FS Shared Lake\FY1S Qtr t.xlsx ofa
FY1S FS Shared
BRADLEY LAKE
R&C FUND DISBURSEMENTS AND REPAYMENTS
SCHEDULE D
Actuai Actual Actual Actual Actual Actual Actual Actual
TO REPAY TO REPAY TO REPAY TO REPAYDescriptionDisburse6/30/2012 Disburse 6/30/2013 Disburse o/30/2014 Disburse 6/30/2015
R&C FUND PROJECTS
0.00 2,770,053.51 $8,252.20 2,838,205.71 $88,125.63 3,424,331.34 $16,325.02 3,040,056.36
Replace RFLS 0.00 251,002.00 0.00 251,002.60 0.00 251,002.60 0.00 251,002.60ReplaceRunners0.00 4,046,732.70 0.00 1,948,732.70 0.00 1,946,732.70 0.00 1,946,732.76Replacecablefromdamtopowerhouse0,00 2,321,022.04 0.00 2,321,022.04 0.00 2,321,022.04 0.00 2,321,022.04
Replace power system stabilizer 447,531.38 501,444.40 27,760.70 810,205.10 0.00 610,205.10 0.00 010,205.10
Replace two RTUs 0.00 86,905.27 0.00 86,005.27 0.00 86,905.27 0.00 86,906.27
Culvert Repairs.0.00 675,006.70 0.00 675,066.70 0.00 075,006.79 0.00 675,900.70TowerRepairforJackFrostHeaves0.00 887,500.62 9.00 887,506.62 0.00 887,506.62 0.00 887,500.62
Replace Piant and SCADA Controls 1,008,208.67 1,008,208.67 336,384.38 1,344,683.05 0.00 1,344,683.05 0.00 1,344,683.05
Vibration Monitoring System 0.00 490.00 0.00 490.00 0.00 490.00 0.00 490.00
Fire Alarm System Replacement 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Battle Creek Diversion 0,00 0.00 470,657.87 470,057.87 471,070.84 950,728.48 5,468.10 056,196.58
Bradley Replace Electro-Mechanical Relays 0.00 0.00 400,803.38 400,803.38 777,303.68 1,277,197.06 0.00 1,277,197.08
Fishwater Screen Debris Removal 0.00 0,00 0.00 0,00 0.00 0.00 0.00 0.00
Turbine Nozzel Repair 9.00.0.00 9.00 9.00 0.00 0.00 87,381.00 87,301.004,455,830.05 |__+0,550,403.68 1,401,048.63|_14.052,352.21 1,834,40002 |_43,780,852.13 000,184.12]-_14,306,036.25
Current Year R&C Repayment (883,075.00)(1,536,319.00)(1,328,076.00}(312,579.00)|Adjust to balance to $5milion 0.00 0.00 0,00
interest in Fund Applied to Repayment (372,014.08)313,407.18"(119,054.02)Net Transfer from Revenue Fund Tesasae (431,633.02)}
Cumulative Prior Years R&C Repayments (9,884,350.26)|(11,246,586.17)|Due Back to Utilities 170,788.03 (431,633.02)Adjust Due to R&C Actual 0.00 0.00
(9,704 562.23)|14,678,216.19)
INET DUE TO R&C FUND 1,708,750.54 1,068,542.70 2.440,806.72 2.286,184.04
R&C FUND CASH FLOW PROJECTION
{Beginning Investnent Balance 3,872,242.58 4,671,804.45 4,627,751.16
Disbursements-current year Accrual (849,472.80)(572,732.26)(1,657,223.72)
Disbursements-prior year sccrued (82,071.10)(606,357.25)!(829,216.26)!
Uttities'R&C Repayment 537,001.26 (773,897.74)(767,077.60);
Current year interest earnings:300,820.60 372,014.96 313,407.18
Participants Contributions to R&C Fund 883,075.00 1,536,310 .00 |-__1,328,076.00|Ending Investment Balance 4.671,504.45 4,627,751.16 3.045,716.76
Accrued Due to Utilities (773,807.74)(767,077.60)|(170,788.03)
Accrued R&C Payable at Year End (606.357 25)]me {829.218.26)]276.735 45)]
less R&C excess cash at 7/1/05
PROJECTED NET DUE +ENDING INVESTMENT BALANCE semen:200,000.00 ]werweew 200,000 90 |ween 5.200,000.00 |
REPAYMENT AMOUNT
$238,606.15 X 25%4th yr 50,651.54
$054,181.70 x 25%3rd yr 238,645.45 [4th yr 238,546.45
$756,005.11 x 25%2nd yr 189,106.28 [3rd yr 189,166.28 [4th yr 189,166.28
1$1,455,830.05 x .25%istyr 363,057.61 J2nd yr 363,057.51 |3rd yr 303,957.51
/$1,401,046.53 x 25%Astyr 350,487.13 |2nd yr 360,487.13
$1,834,400.02 x .25%tst yr 458,624.08
|RRR ES _30255.04
FY2015 Qtr Lxtsx
Unit Statistics:
Bradley Lake BPMC
January 23rd,2015
Operators Report
4¢,1€
Generation Unit 1 (MWhrs)Unit 2 (MWhrs}Total (MWhrs)
November 2014 11,011 26,123 37134
December 2014 19,684 25,440 45,124
Hydraulics Avg.Lake Level(ft)Usage (ac ft)Fishwater (ac ft)
November 2014 1,165 36,581 2,006
December 2014 1,158 44,795 1,899
Lake Level -Jan.20 -1,150.6'
Large Projects:
1)Governor PLC Replacement Final -The project is under-budget.
a.Testing and commissioning of the Emerson governor controls was completedonAugust22".No unit trips or control incidents have occurred in 5 months
of operation.
b.EPS completed and submitted the final Bradley Lake PSSE model to HEA for
storage on the PSSE site.HEA has received the final billing of $71,021 for PSSE
revisions and final commissioning.With authorization from the BPMC to pay
this final invoice,all outstanding work associated with the governor control
installation and the PSSE model will be closed.
c.Bradley governor and rail-belt system operation will be monitored and tracked
during future system disturbances.If any circumstances arise that may require
additional governor or PSSE modifications,they will be dealt with on a case by
case basis.
2)Unit #1 Nozzle Oil Leak -Unit #1,nozzle #4,hydraulic oil leakage has not
changed significantly following the unit #1 de-rate to 38MW.
a.Repair Parts -O-rings,seals,and hard parts (e.g.bushings,and piston rings)
have been ordered to repair the nozzles on both units.Fourteen (14)sets of
parts were ordered.This will allow all 13 nozzles to be rebuilt and will allow
for one extra set that can be utilized and measured for future repairs.There is
an 18 week lead time for parts which should put the delivery date in the 1*
part of May.
Bushings and piston rings -$97,123 (ordered)
Seals and O-rings -approx.$9,000 (ordered)
Additional tips -$150,000,(pending,note:budget section,page 3,item 3c)
b.Schedule -The O&D Committee recommended that outages for nozzle repair
be scheduled in conjunction with CEA tie-line outages.If nozzle condition does -
not deteriorate,the tentative nozzle repairs will be scheduled as follows:
Bradley Unit #1 Nozzle Refurbish -7/6 to 8/7 (33 days}
Bradley Unit #2 Nozzle Refurbish -10/12 to 11/13 (33 days)
Bradley Lake Operator Report Page 1
Large Projects (continued):
3)Fishwater Screen Debris Removal -It is recommended by the O&D committee
that this project be postponed until Spring of 2016.Lake level cannot be reduced
sufficiently in the next few months without spilling water through the diversion
tunnel.Spilling water is not a cost effective or safe alternative.Money Budgeted
for this project in FY2015 will be carried over to the FY2016 budget.
a :Bradley an stevet :oo
aor as
a *9129°"potheasWFLordTeeS
4)Bradley Junction Switch Removal -This project has been on hold while the O&D
Committee reviewed the IMC standards to determine if the Bradley Lake PowerProjectwasexemptfromthestandards.On January 9°The O&D Committee
recommended this project move forward.HEA transmission managers were
notified and will make all effort to complete this project in FY2015.
Bradley Lake Operator Report Page 2
Budget FY2016 -A preliminary Bradley Lake budget was provided to the O&D
Committee and the Budget Sub-committee on January 9th.A general overview
of HEA's portion of the Bradley budget is shown below.
1)FY2016 O&M Budget -The preliminary budget estimate for FY2016 is projected
to be less than 1%increase over FY2015.
2)FY2016 Transmission -The preliminary budget estimate for FY2016 is projected
to be approximately 10%decrease from FY2015.
3)FY2016 Capital Projects -approximately equal to FY2015 including addition of 6
nozzle tips in item 3c.
a.Fire system replacement and upgrade -This project will be conducted in two
phases.Part in FY2015 and completed in FY2016.
Phase 1-Install a gasous type fire suppression system in the Bradley Lake
Engineering room,and replace the Halon fire system in the control room due
to a leaking bottle on the reserve system.Use the existing Halon bottle for
spare on generator systems.
Phase 2-Design and provide bids to replace the original Bradley Lake fire
system control cabinets and alarm panels.
FY2015 -$290,000 carry forward any remaining amountEY20T65$60,000
b.Fishwater debris removal project -
Remaining FY2015 budget amount of $703,070 will be carried over to FY2016.
No additional money added to FY2016 budget.
c.Turbine Nozzle Repair and Refurbish-FY2016Option|T-"reusing,some of the existing tips.$980,000 (six nozzle tips in stock).Option.2'=replace all ndzzlé tips +.$1.1 600 (additional cost =$150,000)
Unit #1 -$490,000 -Includes labor and machine cost.
Unit #2 -$490,000 -Includes labor and machine cost,add $150,000 new tips.
Note Option 2:Still in negotiation with Voith Hydro for nozzle tip cost estimate
We have 6 tips in stock.May be able to reuse some of the existing tips.Cost for 6 additional tips in 2003 was ($25,000 each X 6 =$150,000).
Bradley Lake Operator Report Page 3
KMEA
MATANUSKA ELECTRIC ASSOCIATION
January 21,2015
Cory Borgeson
Chairman,BPMC
Golden Valley Electric Association
P.O.Box 71249
Fairbanks,Alaska 99707-1249
Subject:Bradley Lake Standards
During the previous BPMC meeting on November 17,2014,the O&D Committees
affirmed they would return to the next BPMC meeting with a selection of
questions in an attempt to clarify the desires of the BPMC relative to bringing the
Bradley Lake project up to current standards.
After once again reviewing the request of the BPMC,the O&D Committee
assessed the comments submitted by HEA as operator and determined at this
time there is no requirement to act on those recommendations submitted by
HEA.
Regards,
QaweRL
James Brooks
Chairman,Bradley Lake O&D Committee
MATANUSKA ELECTRIC ASSOCIATION,INC.+P.O.Box 2829 «Palmer,Alaska 99646 »(907.745.3231 »f 907.761.9368 =www.mea.coop
RMEA
MATANUSKA ELECTRIC ASSOCIATION
January 21,2015
Cory Borgeson
Chairman,BPMC
Golden Valley Electric Association
P.O.Box 71249
Fairbanks,Alaska 99707-1249
Subject:Soldotna and Dave's Creek Static VAR compensators
In May 2014 ABB Inc.conducted a survey of the Dave's Creek and Soldotna
Static VAR compensators (SVCs).The Bradley O&D committee has review the
resulting report and believes that further investigation of ABB's recommendation
be conducted.
Of concern is the lack of spare parts,the loss of ABB's competency to support
this equipment and extended outages which might be incurred with a failure of
theses systems.A failure has the potential to leave the export of Bradley power
off of the peninsula limited to one unit's output from Bradley Lake.
A replacement of the system would be a $7.2M dollar expense over a two year
period based on the initial estimate provided.We believe at this time that the
likely recommendation would be a total system replacement however we are not
prepared to make a formal recommendation without further study.
As the value of the dollar appears to have improved favorable against the Swiss
Krona the O&D committee recommends we solicit a new proposal from ABB.
Regards,
James Brooks
Chairman,Bradley Lake O&D Committee
MATANUSKA ELECTRIC ASSOCIATION,INC.*P.O.Box 2929 Palmer,Alaska 99645 +t 907.745.3231 «f 907.761.9368 »www.mea.coop
BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING
DRAFT REGULAR MEETING
Alaska Energy Authority,Anchorage,Alaska
November 17,2014
1.CALL TO ORDER
Chair Borgeson called the regular meeting of the Bradley Lake Hydroelectric ProjectManagementCommitteetoorderat9:31 a.m.wo,
2.COMMITTEE MEMBERS ROLL CALL
Cory Borgeson (Golden Valley Electric Association (GVEA));Bryan Carey (Alaska Energy
Authority (AEA));Burke Wick (Chugach Electric Association (CEA));Joe Griffith (Matanuska
Electric Association (MEA));John Foutz (City of Seward (SEW));Jim Trent (Municipal Light&Power (MLP));Harvey Ambrose (Homer Electric Association (HEA));:
3.STAFF/PUBLIC ROLL CALL.Sara Fisher-Goad,Amy Adler,Jocelyn Gamer,Kelli Veech,Teri Webster,Wayne Dyok (AEA);Brad Evans (CEA);Patrick Dolan,Ron Woolf (GVEA);Brian Bjorkquist (Department of Law);Rick Baldwin,Jim Cross,Bob Day,Alan Owens (HEA);Jim Brooks (MEA);Lou Agi,Jeff
Warner (MLP);Bernie Smith (Regulatory Commission of Alaska (RCA));Kirk Gibson(McDowell Rackner &Gibson);Miranda Studstill (Aceu-Type Depositions)4,AGENDA APPROVAL |
Mr.Carey requested switching the order of Item 2B.Budget Process with Item 7E.Report onKeeperofthePSSEModel.
The agenda was approved as amended.
5.PUBLIC COMMENT
There were no public comments.
6.APPROVAL OF PRIOR MEETING MINUTES-Sept 18,2014
MOTION:Mr.Wick made a motion to approve prior meeting minutes of September 18,
2014.Motion seconded by Mr.Ambrose.
Chair Borgeson corrected page three,Item 7A,which reads,"Chair Borgeson expressed his
appreciation to Vice-Evans"and should read,"Chair Borgeson expressed his appreciation to
Vice-Chair Evans."
DRAFT BPMC Minutes 11/17/14 Page 1 of 5
The motion passed as corrected.
7.NEW BUSINESS
A.Scheduling of transmission outages affecting Bradley power
Chair Borgeson began the discussion regarding the coordination of transmission outages with
Bradley maintenance and service in order to have the most efficient,effective use of thetransmissionlines.Mr.Wick explained that CEA maintains a railbelt maintenance schedule foralltransmissionandgenerationthatbelongstoalltheutilities.Thé'schedule iis updatedthroughouttheyear.Each utility has a representative at those meetin s and has dedicated lineitemsontheschedule.The 2015 scheduleis currently being developed,N The intent is tocoordinatetransmissionandunitoutagesatthesametime,While,leaving 'ample generation fortherailbelt.A.
Mr.Griffith asked how the scheduleis reviewed to minimize the cost.Mr.Wick'stated thereviewofthescheduleisajointeffortanditerativeprocessaméngtheutilitiesandtheupdatesarecontinuous.Chair Borgeson asked if any particular1issues are expected due to the draw-downofthelake.Mr.Wick noted needle valve work at Bradley Lake has to occur and HEA has a six-week winter outage between Soldotna and.Quartz Creek.The hope iis to have these occur at thesametime,but it is unknown if the components necessary to repairthe needle valves will beavailableduringthattimeandiftheweatherwillpermit:it.CEA has a line construction projectbetweenPowerLinePassandIndianfromJuly113!£6 the middle éf September.Mr.Owens explained the needlevalve iissue and 'the work that needs to be completed.The costisapproximately$220,000 for one unit,plus a spare nozzle.He noted there is enough money inthebudget,if authorization iis given to move funds around.Thereis $112,000 leftin the nozzlefund,$112,000 leftin the governor project,and thé fish water issue is estimated to be $370,000,which could possibly be reallocated for labor to change out one unit.Mr.Owens recommendedeightpartsbeorderednow,because of the(18-week lead-time.He suggested evaluating theprojectsinJanuarytodeterminewhichprojectneedstooccurfirst.Mr.Owens expressed theintentistoreplacesixnozzlesinthisbudgetcycle,six nozzlesin the next budget cycle,and tohavespare'Parts.NNMr.Ambrose commented another alternativeis to only replace the "O"rings,which would belessexpensiveanddoesnothavealong-lead time.Mr.Griffith strongly favors replacing all ofthewearpartsatthesametimethe"O"rings are replaced and spend the approximately $600,000torepairtheunit.¢
MOTION:Mr.Griffith made a motion to reallocate the remaining funds of $112,000 from
the governor rebuild project to the nozzle rebuild fund for acquisition of parts for
replacement.Motion seconded by Mr.Trent.
Mr.Griffith asked for the O&D Committee's view on the nozzle rebuild project.It was stated
the O&D Committee agrees the nozzle rebuild work should be completed and if the fish water
DRAFT BPMC Minutes 11/17/14 Page 2 of 5
valve work does not go forward,the O&D agrees it is best to reallocate those funds to the nozzle
replacement project.
The motion passed.
Chair Borgeson informed GVEA has recently received a communication from HEA regarding
charges affecting the Soldotna segment of the transmission services agreement for Bradley.A
discussion with the utilities occurred regarding the request of HEA to bill back to 2011 for
overhead allocation for the work completed on the Soldotna segment.Mr.Foutz has notreviewedthecommunicationfromHEAandrequesteditbeforwardedtohim.Mr.Wick agreedtoprovidethelettertoMr.Foutz.Chair Borgeson asked Mr.Baldwin and Mr.Gibson to verifythebilling.Le NOaaB.Report on keeper of the PSSE model .- ,NSan"a KO
Mr.Ambrose informed Mr.Cross,the former Chairman of the committee who oversees thePSSEmodel,is available for questions.Mr.Griffith asked who has the correct PSSE model andwhothekeeperisofthatmodel.Mr.Cross advised the PSSE,model databaseis on an FTPservermaintainedbyHEA.Thereis a web interface,and password and user name are protected.All the utilities have the password and have complete rewrite access to all the data.Each utilityisresponsibletopostupdates.Mr.Cross noted three of the committee members are new this yearandhadnotpreviouslyusedthePSSEmodel"They are inn the process of training.YO.ae NAOC._Report on Spill prevention issues }
A NS xMr.Wick advised thé spills in the fast few years were typically due to maintenance,pond carry-over,and unexpected high}inflows into the project.'The O&D Committee has not determinedanychangestotheproceduresforschedulingBradleyoutput.The O&D will continue toevaluatetheprocedures.Mr.Ambrose believes following the procedure of bringing the unit uptofulloutputwillpreventmostofthespillsandtheseproceduresneedtobefollowedcloselywhenpendingspillisreached._aie
¢Y feDes.Update on Dispute Résolution process and litigation affectingTransmission/wheeling rates for Bradley power\:i 4
aChairBorgesonstated he requested Mr.Gibson hold off on an update until a later time becauseoftheamountoftherelatedongoingactivity.Mr.Griffith asked if the Dispute ResolutionCommittee's report has been approved collectively,and if a letter was written and sent to HEA
reflecting that report approval.Chair Borgeson will provide an update on the status of the formal
notice to HEA regarding the dispute resolution decision process at the next meeting.
E.Budget process and information for Bradley Budget
Mr.Dolan provided an overview of the budget process.Once the budget templates are compiled,
all the information can be rolled into one budget file and detailed reports can be run.
DRAFT BPMC Minutes 11/17/14 Page 3 of 5
Mr.Owens requested a copy of the spreadsheets the Budget Committee wants completed.He
noted additional time will be needed if he is required to provide a new level of detail.Mr.
Owens believes it is a burden to HEA to provide the BPMC with a breakdown of each
employee's personal leave,vacation leave,and 12 categories'worth of information.He believes
it would be beneficial to give the BPMC each employee's wages and benefits package,as well as
the hours billed to each budget category.Mr.Carey advised HEA is currently providing a
summary list of employees,the number of hours,and their burden rate with each laborer and
O&M invoice submitted to AEA.vamAemhChairBorgesonstatedthatifthesummarylistmatchesthebudget,'this would provide thenecessarytracking.He suggested part of the budgeting process could include the make-up of theburdenissues.N\NS.Mr.Ambrose commented he is still unclear regarding,theCin request by Vice-Chair Evans.He believes HEA does provide adequate detailed reporting to AEA,as required.He noted HEAdoesnottreatBradleyLakewithoverhead.Mr.Ambrose expressed significant concerns withmakingrequesteddetailedprivateemployeeinformationavailabletto.the public.#Mr.Griffith understands the HEA contract is with the state ond asked what role the BPMC playsconcerningthatcontract.Mr.Baldwin explained the broad scale relationship between the BPMCandthestateisestablishedbythePowerSalesAgreement.The idea'was the BPMC would runtheprojectandAEAissubjecttocertainnon-delegableduties pursuant to the bond covenant.The contract lists the specific responsibilities to specific'items.HEAis obligated to make itsrecordsavailableatreasonabletimestoAEA.Mr.Bjorkquist explained the BPMCcommunicatestoHEAthereasonableneedstoproperlymanagetheproject.If HEA believesanyoftheserequests''areunreasonable AEA can provide a bufferin those situations.Chair Borgeson asked if the utilities aare third-party beneficiaries to the contract between HEAandAEA.Me.Gibson noted the contract specifically states the BPMC,as representative of thepurchasers,isa third-party beneficiary to the O&M contract in Section 20.Section 7B.Budgetstates,"The draft budget shall be prepared iin a format and schedule provided to the Authority bytheBPMC."Thereis an expectation |that everybodyis working together and the BPMC doeshavetheabilitytorequesttheformat'and schedule of the budget.Mr.Day walked through the BPMC approved fiscal year 2015 budget with the Committee.Hebelievesthelevelofdetailrequestediswithinthisbudget,but may be better presentedin the
format proposed by GYEA.
8.COMMITTEE REPORTS
Mr.Brooks informed much of the O&D report has already been addressed in terms of the nozzle
replacement project and fish water project updates.The O&D Committee has been struggling
with Resolution 2013-03 (Adoption of Railbelt Reliability Standards)in bringing the Bradley
Lake project into compliance.The O&D Committee needs more direction from the BPMC.
DRAFT BPMC Minutes 11/17/14 Page 4 of 5
9.OPERATORS REPORTS
Mr.Owens noted most of his report provided to the members has been discussed during the
meeting.He informed the governor seems to be performing fairly well.Mr.Owens gave an
overview of the sonar survey in the fish water report and noted the entire 4-page report can be
provided to the BPMC members,if requested.
10.COMMITTEE ASSIGNMENTS
Chair Borgeson gave these assignments throughout the meeting.;woo,
Mr.Gibson and Mr.Baldwin are to discuss the billing under the Transmission ServicesNAgreement.\moaa\The O&D Committeeis to provide the BPMC a specific list of clarifications and concernsregardingResolution2013-03 by late December.The BPMC will be prepared to respond to thislistduringtheJanuaryBPMCmeeting.oN j
The Budget Committeeis to decide what changes are needed iin the budget format andcommunicatethosetoHEAbyearlyJanuary.%,
_11.MEMBERS COMMENTS x a -Mr.Carey informed there have been presentations tothe O&D Committee regarding changes toBattleCreekthatwouldsimplifyandlowerthe'costs.More information regarding this will bedistributedtothemembersintheformonanemail.There are enough fundsin the budget for
this process.a 'LS¢.oe
!Chair Borgeson expressed hisappreciation for'the time and effort put forth by everyone.12.NEXT MEETING DATE-Jan 23,2015ChafrBorgesonwillcomaunicatetotoinnembersifthe January 23rd dateis changed.13.ADJOURNMENT
There being no further business for the committee,the meeting adjourned at 11:27 a.m.'
4
BY:
Cory Borgeson,Chair
Attest:
Sara Fisher-Goad
Alaska Energy Authority,Secretary
DRAFT BPMC Minutes 11/17/14 Page 5 of 5