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HomeMy WebLinkAboutFeasibility Study Copper Valley Intertie SOA, DCRA, Div of Energy Vol 3 Transcripts of Public Testimony Public Comment April 1994Feasibility Study Copper Valley Intertie State of Alaska,Department of Community and Regional Affairs, Division of Energy Volume 3 Transcripts of Public Testimony Public Comment April 1994 Feasibility Study Copper Valley Intertie State of Alaska,Department of Community and Regional Affairs, Division of Energy Volume 3 Transcripts of Public Testimony Public Comment - April 1994 Copper Valley Intertie Feasibility Study (PROVIDEDASA SEPARATE BOUND DOCUMENT.)VOLUME 1 Section I Executive Summary Section II Introduction Section TI Route Selection Section IV Feasibility Design -Transmission Line Section V.Feasibility Design -Substations Section VI Project Cost Estimates Section VII Project Schedule Section VII Electric Load Forecast Section [IX Power Supply Evaluation Section X Evaluation of Alternative Power Supply Plansand Economic Analysis Appendix A Route Selection Evaluation Documentation Appendix B Preliminary Design Documentation Appendix C Sample Cost Estimating Sheets Appendix D Selected Material Cost Quotes Appendix E Technical Review Meeting Summary Appendix F Miscellaneous Documents Appendix G Diesel Generator Emissions Limitations Appendix H Review of Valdez and Glennallen Coal-Fired Generation Plants Appendix I Conservation Analysis | Appendix J Resource Model Outputs Appendix K Petro Star Valdez Refinery -Expansion Assessment Appendix L Economic Analysis Methodology Issues (PROVIDED AS A SEPARATE BOUND DOCUMENT.)VOLUME 2 Appendix M Supplement to Environmental Review Appendix N Environmental Review By Dames &Moore,Inc.and Initial Public Comment Appendix O Electric System Analysis By Power Technologies,Inc. VOLUME 3 Appendix P Transcripts of Public Testimony Appendix Q Public Comment on Draft Report Copyright 1994,R.W.Beck All Rights Reserved. Sadras”*COPPER VALLEY INTERTIE FEASIBILITY STUDY - CS Appendix Bo 24 25 Proceedings recorded by electronic sound recording. PARTIAL TRANSCRIPT OF PROCEEDINGS (Public Testimony Portion Only) VALDEZ,ALASKA Monday,February 7,1994. produced by transcription service. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 Transcript PUBLIC TESTIMONY OF: PAUL ROETMAN .. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 TABLE OF CONTENTS VALDEZ,ALASKA -MONDAY,FEBRUARY 7,1994 (Tape No.1,Side 2) MR.ROETMAN:Paul Roetman. HEARING OFFICER:Got a spelling? MR.ROETMAN:R-o-e-t-m-a-n. HEARING OFFICER.Okay.Please go ahead. MR.ROETMAN:Okay. PAUL ROETMAN Just a real short comment.My name is Paul Roetman. I represent the Prince William Sound Economic Development Council.We represent Chenega,Cordova,Tatitlek,Whittier, and Valdez. With electricity being the --a primary barrier to economic development,our full Board has shown and expressed strong support for the Copper Valley intertie project.Asa regional economic development organization,we realize that improving this infrastructure is certainly beneficial to us all.To quote our President,Tom Van Brocklin,what he said at our last quarterly meeting last month: "Anything that we can do to reduce electric rates is a positive for economic development,in Valdez and Prince William Sound." Thank you. HEARING OFFICER:Thank you.Anybody else? Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 2 24 25 then. (No audible response) HEARING OFFICER:Okay.:Well,I guess we're done Thanks a lot. (Whereupon,the proceeding in the above matter was adjourned) Additional Note From Hearing Officer R.Emerman: After the tape recorder was turned off,Ms... Donna Fischer came forward and asked that her brief remarks be paraphrased for the record.The sense of her remarks was as follows: Donna Fischer remarks,paraphrased by R. Emerman:Ms.Fischer expressed concern with the high rates in effect from Eureka to Valdez,and expressed her belief that the intertie would be beneficial to the whole area.By bringing down rates,theintertiewouldhelpinducebusinessesto locate in the area and help diversify the local economy from dependence on the oil companies. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 STATE OF ALASKA ss. THIRD JUDICIAL DISTRICT I,CINDY S.CARL,do hereby certify: (1)That the foregoing pages contain a full,true,and correct transcript of proceedings in the above-entitled matter, transcribed by me,or at my direction and supervision,to the best of my knowledge and ability. (2)That I have been certified for transcript services by the United States Courts. (3)That I was certified for transcript services by the Alaska Court System prior to January 1,1993. SIGNED AND CERTIFIED: re hCl oo...DATE:2lislad"oma s{/Carl -ae tormentsCertifiedCourtReporter Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 24 25 Proceedings recorded by electronic sound recording. PARTIAL TRANSCRIPT OF PROCEEDINGS (Public Testimony Portion Only) GLACIER VIEW,ALASKA |Tuesday,February 8,1994 produced by transcription service. Executary Court Reporting 626 Cordova.Suite 104 Anchorage.AK 99501 Phone:(907)272-4084 Transcript PUBLIC TESTIMONY OF: TOM BERKLEY .. HANS STRICKER . JIM COLVER... KATHERINE WRIGHT . DWIGHT DIETRICH 'Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 TABLE OF CONTENTS PAGE 10 GLACIER VIEW,ALASKA -TUESDAY,FEBRUARY 8,1994 (Tape No.1,Side 2) TOM BERKLEY My name is Tom Berkley,B-e-r-k-l-e-y.I own Eureka Lodge on the Glenn Highway.I'm a member of the Copper Valley Electric Association,and I pay them a lot of money every month,and I get a little newsletter --it's very nice. Copper Valley Electric Association is a group of people,including me and the rest of the consumers,and _- Colleen,where you going? (Inaudible response) MR.BERKLEY:Oh,okay.Thanks a lot,guys. BY MR.BERKLEY (Continuing): | And they're people just like us --they got to go out and grab a cigarette,or they got to eat,they got to drink, whatever.They're just like real people.And I sincerely believe that this --what you have seen,what we have all gone through,for the last year or so is real.This is not some- thing phony;this is real. They're not sitting there in Glennallen dreaming up monuments in the forms of 90-foot poles between Glennallen and Sutton as a monument to their achievements.This is a neces- sary thing that we need.And we've been through it all,the reasons that we need it.And all we're asking is a little bit Executary Court Reporting 626 Cordova.Suite 104 anchorage,AK 99501 Phone:(907)272-4084 2 24 25 of cooperation.Sure,we're going to stomp on your territory. But we --it would be nice if we could have the same advantages that you folks do down here.Okay? And please remember,in all this discussion about money and who's paying for what and what about this and what about that,we're paying for it.Okay?We're paying for it. That's it. HEARING OFFICER:Thank you. (Inaudible comments) HEARING OFFICER:Your name? MR.STRICKER:My name.You want my address also? HEARING OFFICER:Yes,sir. : MR.STRICKER:All right. HANS STRICKER Yeah.My name is Hans Stricker,and I'm a home- steader.I'm not hooked up to MEA power. And I just want to say what I said earlier,to make sure they hear it and got it clear --that they take the Boulder Creek route.I've heard what they've said about the environment and all that,and I really wasn't impressed.But I think for myself,I just had to say that because I think that's the better route;it'd make me happier. So that's all I got to say.Thank you. (Pause) //f Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 3 JIM COLVER ,Jim Colver,C-o-l-v-e-r.First I'd like to address the economics of the study,the intertie study. The study shows,despite much pro-intertie influence, that an intertie is not the least-cost alternative for CVEA consumers.Study shows that a hydro project at Allison Lake is the best least-cost alternative.It does not make common or economic sense to gamble on a four-fold increase in demand at Petro Star Refinery to justify the intertie.There is no , advance purchase agreement with Petro Star to protect rate- payers,to guarantee to purchase enough power to pay for the line.This puts consumers on the hook,which could result in even higher rates. If you take the $46 million cost and divide it by the 2,943 consumers you have in Copper Valley,that's $15,630 of debt per consumer.But the --another question is,What is the economic cost to the MEA consumer?It goes through the MEA service area.The study doesn't identify any related cost to the MEA consumer,and I think that's a valid point that needs to be followed up on in the final report. And in some areas,it appears that the cost estimate for the intertie is too low.The study has an average labor rate of $121 an hour,which is supposed to include helicopter time.Helicopter time costs at least $600 an hour. Right-of-way acquisition costs appear to be too low. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 4 The dollar value per acre is low,and the right-of-way width was computed at 125 feet instead of the standard 150-foot wide. And there's no accounting or budget for buying out right-of-way across the mining claims in the back country. Another concern is the design.There's no mention of the access roads that are intended to be built to access the line.This is an integral part of the whole project and needs to be right out in front,right with the alignment,where the proposed access roads are going to be,'cause they'll have as much or more impact on the back country than the line itself, and a lot of impact on the adjacent lands,and will increase the access and pressure on the fish and wildlife resources. The --another concern on the design is the EMF safe factor.Now,the study assumes that at 600 feet away from this 138,000-volt line that you'll be safe at 600 feet.Well,the authorizing legislation that provided for this intertie says it could be --that the line could be expanded to a higher capa- city,which would probably be 230,000 volts. Now,so we need to design around what it could be upgraded to;that means a proper right-of-way width and the safe EMF distance,which would certainly be more than 600 feet. If we're going to prudently design this thing for the possibil- ity of any upgrade in the future,we got to use the extreme pessimistic figure to incorporate any kind of upgrade this line may incur because,once this route is established and upgraded Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 ;5 24 25 in the future,we may not have the luxury of deciding where to site and have the distance because,as one of the factors in the siting criteria,they use 600 feet as just the bottom line. If you were 600 feet away from a private residence,that was good enough. So I think we need to back up there and look at that criteria,in the event that the line is upgraded to a higher voltage in the future,so that we don't have any conflicts or any potential cancer-causing electromagnetic fields out there. One major flaw in the siting factors was that there's no section that says what the community preference is.There's a visual,and there's a cultural,and there's environmental factors.But probably paramount,with the most amount of points,should be what the community preferences are for sit- ing.So I think that's one thing that you missed.When you're --if you're going through the data,you obviously saw some of the comments that people had.on where the preferred route would be,and that should be given about the highest weight. Now,I see that didn't work very well with your -- the community preference was for a Boulder Creek route,but yet,using your siting criteria,you ended up with an Anthra- cite Ridge route along the south side,which is --goes across -and I'm --now I'm going to rebut why --using your own siting criteria,why the Boulder Creek is a better alterna- Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501Phone:(907)272-4084 6 tive. Number one,you used a cultural resource conflict evaluation.Okay?So the location that you put the route along,the Anthracite Ridge,is adjacent to the Nelchina Trail, and that's areas where indigenous people have traveled for many years.There's probably a lot of artifacts and archeological history out there.So that is something that would not fly in that category as a cultural resource. Visual intrusion.The Anthracite Ridge route is within a mile of the highway,along the Cascade area and Puri- tan Creek,and there's a lot of little private parcels of land in there.You're definitely really close to property in there. So again,your siting criteria there did not really effectively weigh it out. | Scenic viewshed.Within a mile of the highway,it's going to be visible.As the road gets upgraded,the clearing limits are going to go back,and we're going to have --within a mile from the highway,if we use that Anthracite Ridge route, you''re going to have the power line right there. Stream crossings.Another factor that was used in siting the route was how many streams does it cross.Well,you cross no less than seven streams in the section between Simpson cabin and Hicks Creek.So again,that --using your own criteria,it doesn't make the grade. And increased access.One of the criteria was trying .Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 7 to limit the amount of additional access into the back country because of the project.A mile from the highway and at -- there's a major trailhead at Puritan Creek.You got a lot of people going in and out of there;you're going to increase the access to the impacted area along the highway there.So again, using your siting criteria,it doesn't fly. So therefore,using those criteria,the Boulder Creek option would be the preferred alternative in this eve---in that area,starting at the Simpson cabin and then continuing on to where it gets back into the Alfred Creek. Now,we've just heard from MEA that there's no imme- diate plan,or even in the immediate future,to build a substa- tion,which was the reason why we supposedly routed the line in the Anthracite Ridge/Puritan Creek/Cascade Creek area.So that argument is now thrown out,and so we now don't really have to put it by Victory and in that area because the substation is not necessarily a go in the near future.Definitely,we can't design around something we're not even going to build.We need to think about what some of the other parameters are,and I think number one would be the community preference in this situation. In summary,in looking at this project,it never makes sense to build a projectto buy some..... (Tape Change -Tape No.2,Side 3) BY MR.COLVER (Continuing): Executary Court Reporting / 626 Cordova,Suite 104 Anchorage,AK 99501 . Phone:(907)272-4084 8 --...think this project meets the economic merits that -- what this feasibility study was supposed to do:identify the costs and the benefits. (Pause) KATHERINE WRIGHT Well,while I'm up here,my name's Katherine Wright, W-r-i-g-h-t,and I'd like to go on the record as saying I ama Copper Valley consumer,and I do not want to see this intertie project happen.I have a number of reasons. Like that was just stated,the economics of this Allison Lake does look better in the long run.And with Petro Star putting out some of their information that they did,we cannot even be guaranteed of that. And I really resent the fact that this project has gone on;I mean,they were promoting it when the northeast intertie was around.And they used my Co-Op dollars to go out --and I understand they're in a position that they've got to quiet the consumers,they want lower costs,but it's obvious that we won't get lower costs now. And the interest on this money,the intertie versus Allison Lake,when you're talking about those millions and interest over 10 years,it gets phenomenal.What the State's going to have to pay --what we will have to pay in the long run --for this project is just too much,too much to bear,in my opinion. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 9 And I just do not like the intertie in any route,in any shape,or any form.But the Boulder Creek route is the most preferred if that's the one I need to accept. , DWIGHT DIETRICH Yeah.My-.name's Dwight Dietrich,and I got power from Copper Valley Electric in 1992;I was on alternate energy 'for 10 years before that.I worked with these folks for several years to hook up.I've enjoyed their power.They've worked well with us in that project,helping us out.And if they can do this and,you know,not step on anybody's toes, keep it away from the people,and it looks like they're doing a "pretty good job,I support it. And I think what we also have to remember is this power that MEA is getting in this community is coming from transmission lines from somewhere else. (Pause) HEARING OFFICER:Thanks.Anybody else? (No audible response) HEARING OFFICER:Okay.Well,thanks a lot.End of the meeting. (Whereupon,the proceeding in the above matter was adjourned) Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 10 CERTIFICATION-- STATE OF ALASKA SS. THIRD JUDICIAL DISTRICT feeeeeeeI,CINDY S.CARL,do hereby certify: (1)That the foregoing pages contain a full,true,and correct transcript of proceedings in the above-entitled matter, transcribed by me,or at my direction and supervision,to the best of my knowledge and ability. (2)That I have been certified for transcript services by the United States Courts. | (3)That I was certified for transcript services by the Alaska Court System prior to January 1,1993. SIGNED AND CERTIFIED: or LiL Corl .,DATE:alislayciney6GieeesettCertifiedCourtReporter Executary Coert Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 24 25 PARTIAL TRANSCRIPT OF PROCEEDINGS (Public Testimony Portion Only) GLENNALLEN,ALASKA Wednesday,February 9,1994 Proceedings recorded by electronic sound recording.Transcript produced by transcription service. Execetary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 24 25 TABLEOFCONTENTS PUBLIC TESTIMONY OF:PAGE JOHN DOWNES -.2 2...ee ee 2. GARY HARRISON 21...ee ee ee ee 4 RON FRANK «we eee ee ee 6 DONNA TOLLMAN .2...ee ee 8 JEREMY WELD «ww.1 eee ee ee ee ee 8 JOHN DAVENPORT ....0...4 ee ee ee ew tw ew es 10 JANE BROWN.2...1 ee ee ee ee ee ee eee CD Execetary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 ; Phone:(907)272-4084 'i GLENNALLEN,ALASKA -WEDNESDAY,FEBRUARY 9,1994 (Tape No.2,Side 3) JOHN DOWNES Yes,my name is John Downes,and I am on the Chamber of Commerce Board,Copper Valley Chamber of Commerce Board,and I was asked to come tonight and make a positive comment for the 'intertie.I have several things here I'd like to say. First,we believe that the intertie is environmen- tally sound;it's the least damaging and disruptive to everyone involved.We feel that the long-term benefits are power stabi- lization.The growth in our community has been stifled because of the high cost of power.We feel that the power line would bring us closer to an interstate power grid throughout the triangle,from Anchorage to here to Fairbanks,which would make the power more reliable in the future;this is just one step further. Our community will never prosper without this inter- tie due to the high cost of power.Our generators are old,and they''re going to be --need to be replaced in the near future. That's a cost that we're going to have to face no matter whether we have the intertie or not.Our generators are 25 years old,or they haven't been produced in 25 years.Our power will have to be replaced,and the thought of having a coal-fired plant in our community is offensive to us. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 2 24 25° Number one,why should we buy a 40-year-old power plant when we already have a 25-year-old power plant?That doesn't seem quite economically feasible in any respect.We also feel that the letters that have been presented by other 'people from other communities are --the letters that I have read are full of half truths or uninformed,unintelligible comments by people that obviously are not informed.And we feel that maybe it's our fault that we haven't communicated with these other communities our needs and our wants. | But we feel that an informed board,informed committee,that decides this will be able to see through some of these letters that we have read that's in this study or -- you know.And you and I are both smart enough to see over,you know,that kind of rhetoric.So we feel that anything positive that we can say or we can do as the Copper Valley Chamber of Commerce,we will be more than willing to do in the future to help rectify any of these problems. | I will personally go to any community,as part of the Board,to speak to any of them about any of their problems as a --not necessarily as a Board member,but as a paying member of the community,and try to seek and get their understanding. So that's basically what I wanted to say as public comments, that if there's anything we can do as the Chamber of Commerce and/or individuals in the Chamber,we'1ll be more than happy to do to help inform the people that are so uninformed as to this Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 ; Phone:(907)272-4084 3 24 25 project. So that's all I have to say. HEARING OFFICER:Thank you. MR.DOWNES:Thank you,sir. (Off record) (On record) HEARING OFFICER:Go ahead. GARY HARRISON My name is Gary Harrison,and I live in Chickaloon. They're trying to run this power intertie through Chickaloon Village's land,which,if I have anything to do with it,it will not. Also,I want to point out that when they did their. study,they did not use what is known as a "Trump"in these hydro projects.The Trump system has been around before Christ,basically compressing air with water through the hydro pipes.And if these new or old technologies were -or old technologies were used in new manners,they would produce more energy than this community would need with hydroelectric power rather than diesel generator or an intertie that is basically run on gas,which both of them are --you're going to have to buy your fuel,where hydro,you don't buy your fuel. And how people can think that to maintain these diesel generators and put through this intertie is economically efficient is beyond me.They'd better go back to math class or Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 4 something.I don't --something doesn't compute there. Not only the fact that I believe that they have calculated the price for this intertie to be very low,I have a book that --produced from the power company,that tells me on high --or low-head hydro projects,that I should estimate my power lines at a million dollars a mile,and that's on low- head.And this here is estimated somewhere around $300,000, which is low from many projects which have been produced simi- lar to this.Like the Bradley Lake power line was five hundred and some thousand a mile. With many of these idiosyncracies here,I don't understand why people continually want financial boondoggles such as this.Not only that,but this thing goes through many high-density areas of wildlife.I have a study here that says the wil---that these EMRs produce cancer in humans.And if it's running through many critical habitat of these others,it will put --produce cancers in them.Many of us happen to eat off of this food chain and don't really want to be eating cancerous game. Not to mention the fact that there may be change orders and many other things in this that will significantly increase the price of this intertie. And I probably got more to say,but I can't think of it all right now.But I'm definitely against the intertie,and it definitely does not make economic sense.Thank you. Exeestary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 , Phone:(907)272-4084 5 (Off record) (On record) HEARING OFFICER:Ron Frank,please go ahead. RON FRANK Well,I'm for the intertie.And I'm here on behalf of Gulkana Village,and I think the intertie,hopefully __you know,from all the statement and all the pro and cons that I heard in the other meetings and stuff like that. And I --the reason why I'm for this intertie is because,right now,I can't even afford to put in any electric- ity to my new home because it's going up --the rate of elec- tricity is going up every year,and the cost of electricity is. going up every year. And on top of that,our village is --it's on the verge of collapsing,you know,because of the --because we can't keep up --as a community --as a village,we can't keep 'up with the cost of the electricity that's coming in,and we have no other way to generate money.And many time,I guess we have to,you know,sometime get money from the State to pay, you know,for the --to bail us out,you know. And I think,now,this intertie will probably solve, you know,some of the problems for the villages,you know,for the Native villages.And I'm talking for the Native villages here,for Gulkana and other villages,Chistochina and maybe Tazlina and Copper Center and (indiscernible). Executary Court Reportiag 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 6 And if that's not --you know,if that's not pos- sible,you know,I think there's alternat---our alternative is to build our own hydroelectric here in our area because we have a whole bunch of potential here in this area that we never tap in.You know?And that's the alternative,I think,that we should look into,too. And I don't know how many interests the Governor has on this project.From what I hear from other people,or other people who give their testimony,I think maybe the Governor has a financial interest in this intertie here.Maybe it's true or not,but if it is --I hope it's not. But I'm here on behalf of my village and on behalf of my other people in this region because a lot of us --you know, a lot of us Native people don't have a job because we're not hired on any construction or any project.And if any time in the future,if they're going to use intertie,they're going to go for the intertie,or if they're going to do this thing,I think Native people should have a hundred-percent insurance to be hired on the job,or any kind of job. Because right now,as it is,we are people that are very distressed for a job.And that's all I can say right now. Thank you. , HEARING OFFICER:Thank you. MR.FRANK:Okay. . (Off record) Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 7 (On record) DONNA TOLLMAN My name is Donna Tollman,and I'm with the Copper Valley Economic Development Council,and our Board of Direc- tors,we are very firmly in support of the intertie because of the economic development benefits that it will provide for Copper Valley. One of the largest barriers that we have encountered in trying to develop project (sic)here is the cost of power. And that's basically all I have to say.I've said it many times,but once again..... HEARING OFFICER:Thank you. (Off record) , (On record) MR.WELD:Where is the --where do you speak in this (indiscernible -microphone interference)? (Inaudible comment ) MR.WELD:Okay.Is it on? HEARING OFFICER:Yeah,it's going. MALE SPEAKER:Jerry? | MR.WELD:Oh. JEREMY WELD I'm Jeremy Weld,J-e-r-e-m-y W-e-l-d,a mobile business person from North Country Communications.I'm Presi- dent of the Chamber of Commerce. Execetary Court Reporting 626 Cordova,Suite 104 _Anchorage,AK 99501 Phone:(907)272-4084 8 I want to testify in favor of the intertie and make these specific comments: | I think that even in a low load growth scenario,an intertie makes good sense.In the event of that kind of eco- nomic catastrophe,if that ever came to be in our communities of Valdez and Copper River,the intertie would be a possibility of allowing a recovery to develop.And I think in the medium low load growth scenario,the intertie makes much more sense than the Allison Lake project for several reasons,chief among them,I guess,because there is money to build the intertie. And I understand that the cost analysis doesn't take that into consideration,but it really is the intertie,at this point, for our communities,is the only viable alternative. And I think,also,in the high load growth,if that came to pass,and a pipe --gas pipeline was built,I think the possibility exists that a gas-fired plant either in Glennallen or Valdez could supply electricity back to the Mat-Su Valley, which,under those circumstances,if that gas pipeline were built,the Mat-Su --the associated growth with another pipe- line on Mat-Su and Anchorage might demand additional --might allow them to produce additional power without building another generator,and it might be more practical to use North Slope gas than Cook Inlet. That's it. HEARING OFFICER:Okay.Thanks very much. Execetary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501Phone:(907)272-4084 9 MR.WELD:Okay. HEARING OFFICER:Anyone? (Inaudible comment) HEARING OFFICER:Are you just going by?Okay. MR.DAVENPORT:John Davenport. (Pause) HEARING OFFICER:Go ahead. MR.DAVENPORT:We're on record? HEARING OFFICER:Yes. JOHN DAVENPORT My name is John Davenport.I live near Gulkana Village.I want to testify in favor of the intertie and make just one or two specific comments. I've heard many comments relating to the study of the environment,as required by the National Environmental Policy Act,but I think one thing that has not been pointed out that needs to be pointed out is that NEPA also requires study of the human environment.I think it has been under-emphasized that because of the prohibitive cost of power in this area,there are many human people --there are many people in this area that are not hooked up to a reliable power source because they cannot afford it.I think that needs to be pointed out very clearly. I have a real problem with some of the people that come from other areas that already have reasonable power, Execetary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 10 access to reasonable power,that testify against the intertie. I find it hypocritical,whenever you can look out your own window and see the power line that supplies your own power and reasonable rates,to testify against those who desire the same benefits for themselves and their families. , I am very much in support of anything that will lower the electric rates in this area.Thank you. HEARING OFFICER:Thanks. (Pause) JANE BROWN My name is Jane Brown.I'm a business person in Glennallen,and I have the Jane Brown Art Works Gallery,and I currently am a member of Copper Valley Electric Association. I'm against the intertie as presently proposed for several reasons. I think the assumptions of potential power needs in the future are based on pie-in-the-sky estimates.There's no guarantee of high Petro Star usage in the future,and there's no guarantee that there will be a gas line on this side of the state.And even if there was,I think it would be a high usage for a minimum amount of times,and then the rate would steady off and the gas line wouldn't be using any more power right now 'than the current pipeline does. There are also no guarantees of our rates being lower.There are no guarantees because Chugach Electric will Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 , Phone:(907)272-4084 ll be supplying the power,and they will not guarantee us any wholesale power rates.So it'd be like buying a mortgage for your house with no idea of what your payments would be in the near future. I also think this will be an eyesore running through communities that don't want it,and for 3,000 people in this area,to affect the lifestyles of the people whose communitie this will run through,whether it's on public or private land I don't feel that we can make that decision for the people wh have moved to the state. HEARING OFFICER:Thank you. (Whereupon,the proceeding in the above matter was adjourned) Execatary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 s f ° 12 STATE OF ALASKA ss. THIRD JUDICIAL DISTRICT I,CINDY S.CARL,do hereby certify: (1)That the foregoing pages contain a full,true,and correct transcript of proceedings in the above-entitled matter, transcribed by me,or at my direction and supervision,to the best of my knowledge and ability. (2)That I have been certified for transcript services by the United States Courts. (3)That I was certified for transcript services by the Alaska Court System prior to January 1,1993. SIGNED AND CERTIFIED: pr:Lindy S Cand .pate:_Alisl9y - Cindy s.Uarl :SorosCertifiedCourtReporter Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 Proceedings recorded by electronic sound recording. PARTIAL TRANSCRIPT OF PROCEEDINGS (Public Testimony Portion Only) SUTTON,ALASKA Thursday,February 10,1994 produced by transcription service. Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 Transcript 24 25 TABLE OF CONTENTS PUBLIC TESTIMONY OF: GARY HARRISON .......... CHRIS ROSE..2...2.00. ALAN LARSON...1...00. LARRY BUCHHOLZ»....ee ee LYNN WOODS........-.-.0- ROBIN MCLEAN........0.45 TOM STAHR ....1...eee CHARLENE SCHMIDTKUNZ ....... DAN FITZGERALD......... CHUCK CURRY ........... MARK BERTELS..2...eee DORI McDANNOLD .......... CHARLIE WANSOR.......... CLIFF EAMES ........... ALEX HARRIS ..........- NANCY BERTELS .......... JAMES TAPLEY ......2.2.ees Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501Phone:(907)272-4084 PAGE SUTTON,ALASKA -THURSDAY,FEBRUARY 10,1994 (Tape No.1,Side 2) HEARING OFFICER:Go ahead. GARY HARRISON MR.HARRISON:My name is Gary Harrison,and I am very much opposed to..... MALE SPEAKER:The vandalism of the line? BY MR.HARRISON (Continuing): I'm very much opposed to the line. MALE SPEAKER:.....vandalism to this line as it's trying to be pushed down our throat. MR.HARRISON:And..... (Applause) HEARING OFFICER:If you could let him..... MR.HARRISON:The public comment was pretty good on that. (Laughter) BY MR.HARRISON (Continuing): But anyhow,I'm glad to hear there's a lot of other people that are against this line. There's a lot of things that have not been consi- dered.As they have said,the cost of eco---the economic cost.of ecology is incalculable.As they have said,they can't find anybody that can calculate it because it's so astronomical. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 ; 2 And the technology which they have studied for their Allison Lake is still old technology,which still proves to be 'the best technology for them to use.And I want them to study a Trump,which will make it even better than a regular hydro- electric project;it's 20 percent more efficient. And the other thing that many people don't know is that I'm opposedto them having to build this line and maintain all of their generators also. } FEMALE SPEAKER:Speak up,Gary. HEARING OFFICER:Yeah,you could --you don't have to speak right into the microphone;they're pretty good. MR.HARRISON:Thanks.I''11 let someone else come up here.I commented last night,too,and I got another chance tomorrow.So come up,everybody.This is where you're talking to (inaudible). CHRIS ROSE My name's Chris Rose,and I live in Sutton.It's R- o-s-e.I want to comment on the process a little bit. It's public record that Copper Valley Electrical (sic)Association has had ability to put a lot of pressure on R.W.Beck.I've lookedat all the public records,all the memorandums back and forth,and they've had opportunity to push numbers at R.W.Beck and,actually,I would say,put pressure on R.W.Beck unreasonably,which means that the public --and remember,this is public money --the public is now having 30 Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 3 days and five-minute time limits.Okay?But they can fax stuff back and forth to Seattle for eight months.That's what's been going on. And the numbers have --on the cost of this intertie have gradually been going down and down and down,and the demand for Petro Star has been going up and up and up.And I think that it's going to --we're --it's going to bear out that this is not a feasible project;it's whether or not Edgar Blatchford's going to have any guts to disapprove of it,which he probably won't because he's a Hickel appointee. So we have to make sure that we talk to our legisla- tors and tell them that they are supporting a boondoggle project that's going to cost $60 million of State money,$35 million zero-interest loan over 50 years,$75 to $150 million in interest costs alone.The a---AIDEA is one of the funds that they want to raid right now to solve this budget crisis. How are they going to get $25 million out of AIDEA too? So there's a lot of deception going on right now.I don't know if any of you have saw the article in the paper today that makes a connection between a business man,an electrical contractor named Scott Thompson.And he threw a big bash for Ramona Barnes,and his stated reason in the newspaper article today was because she broke open the $100 million for the intertie.And they raised $30,000 to $50,000 money --$30 to $50,000 that evening for Ramona Barnes.And Scott Thompson, Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501Phone:(907)272-4084 ;4 this electrical contractor,said,'Well,that's just how the system works.' So we're seeing what the system is here;the system is,Who can give enough money to Ramona Barnes to push this through?The system is,Are we going to have any kind of input here unless we put pressure on our legislators? I think it's pretty obvious what's going on:Neil Bergt gave himself a $10,000-a-month raise this morning;he owns a third of Petro Star.And no matter what the public officials say,no matter what R.W.Beck says,it's pretty obvious that this is being built for Petro Star Oil Refinery. And you can say it's a industrial consumer,but the practical matter is,It is Petro Star.Don't put another label on it. And there's politics involved in why this thing is being pushed through.People are making money on it,big money.And they don't care what we're going to --they don't care about us.They changed the route,but yet they tell you tonight that the route can be changed by Copper Valley any time they want.They get the power line away from the highway so the people from Minnesota who are driving up the highway don't see it,but people who live here,they could care less about. The people who live here and have to look at it every day of the rest of their lives,that is not an issue.I'1ll be able to see it from my window.Well,I don't live on the Glenn Highway,but --so I --I'm just at a loss because I don't live Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 . Phone:(907)272-4084 5 oN 24 25 on the Glenn Highway.The --I want you to move the Glenn Highway so they don't have to see this thing.Okay? What's the point?The point is that they're not taking into the social costs of the people who live here at all.A lot of points are going to be made,and these are --a lot of points are going to be written comments,but I want to hit four points real quick,and I've already said a couple of them. One of them is that the cost of the intertie is grossly underestimated:the cost of labor,the cost of heli- copter time,the cost of the static bar compensator,the cost of right-of-way acquisition,the cost of litigation that will be incurred on all these issues.The demand for Petro Star is being grossly overestimated. In the low-growth scenario,which is the most likely --and who's going to make this decision?Edgar Blatch- ford?Is he some kind of demographics expert?But anyway,the low population growth is probably the -most accurate,and it's the diesel generator.The low to moderate is maybe the second most probable,and that's Allison Lake.Only when you start looking at really high demand by Petro Star do you see the intertie coming in as any kind of a project that has any kind of cost/benefit ratio at all. By the way,the statute doesn't even define what a cost/benefit ratio is supposed to be or what an environmental Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 6 factor is supposed to be;it just says look at it.So they look at it,and then they say they did the study.Well,that doesn't make any big difference because it's a political deci- sion.So again,call your legislators. Another point is the environmental impacts,and because they're not telling us now where the route's going to be or where the access roads are going to be,we have no way to make any intelligent comment on the environmental impacts whatsoever.There's no way we could comment on that.So this process is a farce as far as environmental impacts go.Those issues will be litigated. HEARING OFFICER:Your time's running out. MR.ROSE:Okay. BY MR.ROSE (Continuing): I'1l make a couple more points.The alternatives obviously have not been looked into thoroughly.They just keep --Petro Star keeps saying,'We can't co-generate.'Well, they produce fuel.Okay?They have nothing to burn?Okay. They are just saying that because they want the State of Alaska,through Copper valley Electrical (sic)Association,to lay it on a silver platter for them.That's all they want,is a free deal. I think that there's a possibility that there's going to be some growth in population and --in the area.We're not against people having power up there,but this is obviously for Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 . Phone:(907)272-4084 7 "se 7| one big industry.Copper Valley population grew by .9 percent in the last 10 years,and yet they want a power line that's going to bring 300 percent more power in. HEARING OFFICER:Chris,that's six minutes. MR.ROSE:Okay.That's all I have. (Applause) ALAN LARSON My name is Alan Larson.I'm with Chickaloon Village. I'd like to hit a few of our points as well. Starting with the draft report on page I-7,under Rights-of-Way Acquisition and Permitting,it has,under Native Lands,that they're going to pay $246,000 for right-of-way acquisition.Well,at a quick estimate,I'd say that that's about nine months of a lawyer team --I'm sorry --that I'm personally willing to take this to the Supreme Court,and that's a five-to ten-year process in some cases.So they're going to have to bring up the cost there. And then to environmental assessments,page II-30, under Part H.,Route Alternative Comparison: "This exercise of a route comparison is not intended to take the place of a formal impact assessment as may be required by NEPA regula- tions for an environmental assessment." And furthermore,they didn't include costs for an environmental impact statement.We have delivered,and they're sitting on Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 8 the table right there,our resolutions concerning the environ- ment that require and trigger those environmental impact standards that meet or exceed federal environmental impact statements. These resolutions are considered valid under the fact that the environmental laws state that whosever's laws are most strict are the ones that shall be followed.And clearly,the State of Alaska and the United States government don't feel that it's necessary.We do.And it's there. Okay.Under the helicopter costs which were put in here also,typical costs for this class of helicopter would be $550 to $700 for flight-hour plus fuel.If we'totally denied them access roads,they didn't include the helicopter costs for the entire feasibility. And what I'm trying to get at in all of the things that I'm saying is if these each individual items (sic)are so undervalued,it's --then it throws the entire feasibility study off by millions of dollars.And if that's the way it is, then,all they're doing is sending you a set of numbers that are worthless,absolutely and entirely worthless. I can play with numbers until anything looks good. And their feasibility of this study is not entirely assessed in that.Thank you. (Applause) HEARING OFFICER:Anyone?Sure. Executary Court Reporting | 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 9 LARRY BUCHHOLZ My name's Larry Buchholz,and B-u-c-h-h-o-l-z.And I'm glad this is a comment to the Commissioner and all the rest of those folks who,I'm sure,will read it with great (inau- dible)interest. I live --as I say,I live in Pinnacle Mountain Subdivision,the State-sponsored subdivision that was --that we were lucky enough to get drawn on in 1985.We've worked with MEA,and a very nice gentleman there --and prior to him, it was another fellow who was not quite as competent --in an effort to get power to our facility,which is a half a mile off the highway. I'm sorry,folks.I ain't Petrochemical (sic)or anybody else.I can't get power.That's a personal comment. The reason that I think that this is designed for large industry is borne out in the figures that have been developed by Beck.Without huge industry to use the power,the high-growth scenario doesn't win.Allison Lake wins. If the costs are --of the intertie are increased by any of the things that we've talked about here today,and Allison Lake isn't,then Allison Lake may become even more -- or even some of the other less attractive ones could become more feasible than the intertie.The reason that the intertie is the popular route to go is because they can get the money free of interest payment for all this time.It's a free loan Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 10 24 25 to the industry for all intents and purposes. The question of what happens when and if the gas pipeline comes down along the corridor and through Glennallen, and generation plants could be developed there,has that been considered?Or I guess that's a rhetorical question. I guess I'm frustrated by the fact that we are here having an exercise to kind of get the stress level down.And I appreciate that opportunity,but I'm in --I'm much more in favor of whoever it was that said that there will be some of those walking power lines blown off.Thanks a lot. | (Applause) LYNN WOODS My name is Lynn Woods,W-o-o-d-s.I have been opposed to interties,no matter where they are,and I link that directly to my life-long residency in Alaska.They --many issues,whether it be gas pipeline,cost of the intertie,are being addressed by others,but one issue that I felt most attached to was character of community. And for R.W.Beck,I would like to invite them to investigate University of Washington's Gary Peevo (ph)has written articles on that and does --has done consulting work on estimating and valuing character;in addition,David Robin- son,A Survey With a Difference,and Harry Garnum's (ph), Maintaining the Spirit of a Place:A Process for the Preserva- tion of Town Character. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 11 And that is one thing that is very critical to me and public policy.The public policy is the laws that affect us. We are the public.I live here in Sutton;I have businesses here.If you take my land and my home and compare it to the land and home of Eagle River or Anchorage,the difference between those two is what I call the quality of my life.I put just as much energy into that.It does not have the economic value,but it has what I call my quality of life. That's why I'm living here;that's why I put the energy into my place. I feel power lines are archaic.There is better ways to deal with things.Secondly,I feel like a 'community's needs should be handled,maintained,developed not to impact others. And this power line does impact us.I do not want to look at an intertie. To say that EMFs are not a concern goes against a hazardous waste class that my husband just attended.The electrical person discussing electrical hazards said,and I quote: "It's really strange,but under intertie,the grass and vegetation grows differently." There's a reason for that:It is not something manufactured. So that quality of life and our health are really important,and they need to be addressed and be properly evalu- ated to make a decision.Thank you. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 12 24 25 (Applause) HEARING OFFICER:Next person? ROBIN McLEAN | My name's Robin McLean,M-c-L-e-a-n,and I live in Sutton. And I'm really disappointed that you haven't been writing down any of these notes and (inaudible).I know I keep harping on this,but I really would feel so much more confident if you were writing some notes somewhere. But my comments are,first,that Edgar Blatchford has to approve this study,which means that it has to be feasible. And over these months,I've said before,we've been waiting for months to hear about this.They've been --they told us,well, it was going to be in October;we've waited till February,and they come out and they give us this feasibility study.We find out it's public record,that CVEA has been able to manipulate the numbers a little bit,and even Mr.Emerman was kind of worried about that. And so what I see is that Beck,under pressure from CVEA,has raised the -lowered the cost of the intertie ina number of ways and raised the perc---the need for power that Petro Star says that they need. And the --as a --about the cost estimates that I think are incorrect,we've talked about --we've had a consul- tant --who you will receive some comments from so you''ll be Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 13 424 25 able to get this from an expert --that says the labor costs are too low on this project,that it's a helicopter project, and therefore,it's going to be more expensive than you say it is. And that --and do compare it to the Bradley Lake project.And that's a $250,000 per mile difference between this intertie that's going to be going through some incredibly rough terrain --through the Talkeetna Mountains --that's a huge difference in the price of the Bradley Lake project and this project.I would like to see that addressed.I would like to see some change or address that issue in the final inter---final study. This doesn't --does not consider the cost of litiga- tion.And you may not think that that's something that needs considered,but Chickaloon,I'know,is going to sue.There's a lot of environmental groups who are very interested in this who are going to sue.And people in the --this valley,we all have money,and everybody seems to be willing to give it.And so I would expect some legal fights. Thirdly,you're goingto expect some legal fights because this whole authorization of the money was backwards, according to the enabling legislation.It should have gone feasibility study and then authorization.And that's the grounds for a legal suit also.So there's another place. Now,as far as the --Petro Star says that they're Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 14 going to increase their load by three times in the next decade. Well,it said in the Daily News a couple of weeks ago that the guy who sent that letter said,'Oh.Well,those numbers were only for this study.'Just totally contradicting it. Now,I want you to find out why there's such a con- tradiction.Why did they say for the study that they're going to increase it by three to four times,and then some other guy says,'Oh,well,that was just for the study'?We don't believe these numbers because of that kind of thing.It's lucky that we've got people in the press who are paying atten- tion to this because I would never have been able to find that out.They wouldn't have told me. And my final comment is,just that the whole prin- ciple of this thing --I mean,when I first heard about this,I said to myself,'Well,why do we need to do this?'And some- body said,'Well,the State of Alaska has decided that it's important to provide cheap power to people in rural areas.' And I say,I understand that;I really do.And,I mean,I ama potter;I use electricity.I have very high electric bills, and I sympathize with that. The problem is that this is not for those people; this is for Petro Star.And I object to spending my money on --to give Petro Star cheaper power.I object to it.It's not what that whole theory is,to provide cheap money to the rural areas.That is not what we're doing.Therefore,this Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 15 Pie whole thing is a dumb idea. If you look at the population growth,they say in their study that they're expecting 2.7-percent growth in Glenn- allen and .3-percent growth in the Copper Valley,or something like that.If that's true,we take your numbers,then the low- growth estimate is right;then give them some diesel genera- tors.We don't need to pull huge interties through here. Maybe replace the generators every few years. All I have to say,finally,is that this all seems to be a political thing,and the people in Juneau voted this in because some big electrical guy paid off Ramona Barnes to do it.And it's just kind of disgusting that this is really how our State works,and that this is how money gets spent,and they don't really pay attention to what's the best way,the most sensible way,and what's the fairest way to everyone. That's all I have to say. ) (Applause) MALE SPEAKER:(Inaudible)a postcard if people don't have the time,who've already addressed Edgar Blatchford,if you want to get a postcard from me. HEARING OFFICER:Hi,Tom. MR.STAHR:Thank you. TOM STAHR My name is Thomas R.Stahr,S-t-a-h-r.I'm General Manager of Municipal Light and Power.And first,I've got to Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 16 confess,yes,Ramona --I live in Ramona Barnes'district,that I did give her a hundred bucks.And so maybe that's why all this happened --I doubt it. ML&P has made a proposal to sell power to Copper Valley at rates such that Copper Valley will save two to two and a half million dollars per year,taking into account repayment of the State no-interest loan.And I want you to understand that's with their current loads,not any more Petro Star --or just what it's based on right now. And I want to add if this transmission line is not built now with subsidized funding,most or all of it will be built in the future because,just as you now have a transmis- sion line here in Sutton,about two blocks up the road,more will be required to serve local load-in the future as it grows. Those new lines will not be paid for with subsidized State loans;they'1l be paid for by consumers in this area. Now,based on my utility experience --and I've been in the industry about 30 years --I believe this line can be built for less expense than this study indicates. (Inaudible comment) If for any reason you choose to evaluate the priceof future line compensation,please study flexible A/C transmission systems because that technology appears to be much lower-cost than static vars. As a final point,I want to point out that this is a Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 17 conventional feasibility study,and not an evaluation of the true economic choices that are facing Copper Valley and the people of this area;i.e.,there is no State no-interest loan offer for Allison Lake,Silver Lake,or more diesels.Based on the actual realities,this project will benefit Copper Valley's customers.Thank you. (Applause) MS.SCHMIDTKUNZ:My name is Charlene Schmidtkunz. HEARING OFFICER:Please. MS.SCHMIDTKUNZ:S-c-h-m-i-d-t-k-u-n-z. CHARLENE SCHMIDTKUNZ I'd like to point out that the Matanuska Valley is a unique place in the world.It extends a short 60 miles from sea level to the foot of the Matanuska Glacier,and 40 miles of that is being considered for a power line,a large power line. The feasibility study says --hmm --it doesn't include visual impact from all points in the valley.I per- ceive that the small population is going to grow and that this valley is going to be very important,tourist-based,for Alaska.And this power line is cutting right through it. And it doesn't matter --the feasibility study says that the most popular route is only visualized from.the high- way.And I think that that is a big problem (laugh),because Alaska is going to change.And this valley is going to change. And this --that feasibility study does not include that. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 ,18 That's all I have to say. (Applause) DAN FITZGERALD Yeah.My name's Dan Fitzgerald.I don't live along 'this area where the power line would be;I live in Anchorage, but I use this area a lot.A lot of my friends use it.And it's one of the greatest recreational areas accessible by the road system.And it's one of the greatest recreational areas accessible to the majority of Alaskans. What we've seen here tonight,hopefully,is kind of the last act in a tragedy,and that tragedy is State of Alaska and the way that its wealth has been squandered since the advent of big oil.This legis---the legislature,for years, has --primary interest has been creating and building large projects,to get campaign contributions and contractors and builders,and theoretically,at least they believe,and maybe this was the way it was in the past --to get the votes of people who would work on those projects. But apparently,times have changed because we don't even see people here who might be able to work on this project, laborers,out here supporting it.All we have supporting it are the consultant,who's been paid hundreds of thousands of dollars to write this feasibility report,which isn't very feasible,and the people from the electrical associations. There's one customer --I don't think they're even on Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 . Phone:(907)272-4084 19 the map --that this project is being built for.It's way down here.And here's the project.Hundreds of miles;all kinds of alternatives.Through virgin country. The costs that have been assigned to all these non- objective values is zero.zero for wildlife.Zero for.scenic beauty.Zero for any type of recreational use.It's incompre- hensible that you can write a study and assign a value of zero to all this area.That is a blast from the past. I hope that this project isn't built. (Applause) And I hope that the State of Alaska doesn't continue to squan-_ der hundreds of thousands of dollars year after year on bogus studies to build bogus projects that aren't being built for the people of the state of Alaska. This is a --the public wealth is being used to build a project for one private customer:Petro Star Chemical. There's more fossil fuel in Valdez than any place else in the United States of America.And we're going to build a power line hundreds of miles through the wilderness so that an oil refinery can plug into the wall to fire up its refinery. (Applause) Where else but in the state of Alaska,and maybe some third-world countries,would people do such a project?I hope this is the lastof it.Alaska's at the crossroad:We don't have the money.There's a $2 billion deficit,and we're still Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 20 sitting around,the people are coming out,driving their damned cars around,to come to these meetings to try to talk sense into peoples whose jobs it is to do otherwise. But the money's not going to be there any more.The money's not going to --you know what's going to happen to this?If this is approved,they'll start building,and who knows where they'll start.Maybe they'll start here,and they'll get some place out here,and they're going to be out of money..There's no way that this project is going to be built for $49 million.They don't --they're telling you this project's feasible,and they don't even know that --if they're going to be able to float a bond.Who would buy a bond that's going to be paid for by Petro Star?Petro Star could be out of business next year. So we've got $35 million of pork coming out of Juneau,and it'll end up here.Maybe that's not so bad,you know.All of this won't get trashed.But that's where I'd put my money on what's going to happen for $35 million.And it -- he's going to sit here and tell you it's costing forty-nine, but you won't see that company being on the line and say, 'Well,if it costs any cent over,we'll be good for that.'You won't see Petro Star on the line saying,'Well,if it runs over $49 million,we'll just pick up the tab.' The good employees of the State of Alaska aren't going to pay for it.You don't see any private industry say- Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 21 24° 25 ing,'Oh,here's a money-making opportunity.I think I'm going to bring some power over to Valdez.And along the way,I'm going to supply some power to the good people of Copper Valley.'No.Why?'Cause it doesn't make economic sense. Why is it being done?Well,because the State has $35 million to kind of get this thing going. And it'1ll get rolling,itll just sputter out into a big scab of --like the Hickel Highway.There will be a par- tially cleared out area and a bunch of girders,and half of them,it sounds like,from some of the comments in the back of the room tonight,are going to be cut down every other week, and that's where it'll all end. So one last spasm,but let's hope it is the last act of the play.And let's hope that after this fiasco,we won't have to spend all this time and energy fighting stupid projects from the State of Alaska and that the money will be spent on | wise,thought-out projects that benefit people,not private businesses who have all the energy that they need. That's all I got to say. (Applause) HEARING OFFICER:Anyone? CHUCK CURRY My name is Chuck Curry,C-u-r-r-y,and I live down in Palmer.I've spent a fair bit of time in the area that the proposed intertie will go along,and I'm against it for four Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 22 24 25 reasons. One,it seems to me that the cost of this project has been underestimated,not leastof which is the fact that none of the environmental effects have been assigned a cost.I feel that the projected demand for the electricity that'd flow along this line has been overestimated. , Thirdly,I feel that there are feasible,workable alternatives --Allison Lake;new,efficient generators for the people in Copper Valley;co-generation at the Petro Star plant. Fourth,I feel like the impacts to the people who live here and the people who spend time hiking,recreating, skiing in this valley are just unacceptable.Thank you. (Applause) MARK BERTELS My name is Mark Bertels,B-e-r-t-e-l-s,and I live in Sutton.I've got some notes here I'd like to address.Okay. I strongly oppose the Sutton to Glennallen intertie for these reasons: Number One:A deliberate and obvious lack of inten- tion to objectively analyze and compare costs,economics,with alternatives during this so-called study. Number Two:Copper Valley Electrical (sic)Associ- ation's attempt to deceive the public into believing construc- tion costs are at $45.9 million when,in fact,realistically, actual costs could easily exceed $60 million.And I'1ll give Executary Court Reporting 626 Cordova,Suite-104 Anchorage,AK 99501 Phone:(907)272-4084 23 24 25 you an example of that. We didn't address this at the meeting here,but this intertie will be constructed to support a 138-kilovolt load,if I'm not mistaken.Well,that can easily and po---very pos- sibly be upgraded to a 240-kilovolt load.Okay.There's some more costs that we didn't address at the meeting. Okay.This whole thing of $45.9 million is ludi- crous;we're probably looking at much more than $60 million. And what this is going to do,it's going to cause a totally unnecessary debt burden on not only Copper Valley Electrical (sic)Association members but MEA members,too,because they've got to improve the whole system on this side. Okay.Another reason,when you consider real costs of construction and you start comparing normal gra---load growth rates up at Copper Valley,the all-diesel case,followed next by Allison Lake,is still the lowest-cost alternative. And they really haven't addressed some of the,quote,"other alternatives,"some that Gary Harrison and Hobbs have brought up at past meetings. | Okay.The fifth and the last reason --and this could be the most important reason for some people --is the negative impact to the environment,including game populations, from excessive access by the public and undue impact on local lifestyles and our quality of life.I think a lot of people have an idea.how this is going to affect their lifestyles,the .Exeeutary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 24 people that live in the immediate area. But as far as'other environmental impacts that haven't been assessed or cost analyzed,I was thinking of a good example of this when you were talking about that,and one of the examples is Anthracite Ridge up the highway.I know from a fact,hunting up there in the past,that that's,in my opinion,a real.sensitive area because of the lambing areas that the sheep use in the spring,and fossils that could easily be impacted by access,you know,excessive access to the public. , Those are the reasons,the main reasons,that I oppose this intertie.Be---the other thing I'd like to bring up before I quit here isI still think writing letters to our legislators is going to make a difference.I believe if you take the time and sit down and write letters,maybe even a blanket letter,to all the legislators,there's still a chance we can stop this thing.It's just a matter of taking time and then spilling some ink.And I urge you all to do that.Thank you. (Applause) MS.McDANNOLD:My name is Dori McDannold;that's M-c-D-a-n-n-o-l-d.You know,and --as in Mac. HEARING OFFICER:Oh,okay. MS.MCDANNOLD:fThat's okay.And D-o-r-i. HEARING OFFICER:Dan-o-l-d. Execetary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 25 aaa||MS.MCDANNOLD:Yeah. HEARING OFFICER:McDonald (sic). MS.McDANNOLD:McDannold (laugh).That's okay. Don't worry about it. HEARING OFFICER:I got it.I got it,I think,Dori. MS.McDANNOLD:Right.That's insignificant compared to what I'm about to say. DORI_McDANNOLD I'm here representing the Valley Office of the Alaska Center for the Environment and our 120 members that live throughout the valley.And so I'm saving them the time for coming to speak individually,but you will hear comments from them in written form,and I look forward to writing a detailed comment on this study,this feasibility study. , I just would like to say that the validity and the accuracy of this study amounts to about nothing.And the State and the citizens of this state should demand a feasibility study that accurately estimates the cost of construction. Overall costs were grossly underestimated.For instance,the cost for land for condemnation was extremely low and not at all accurate.You didn't include costs for litigation,which you've heard will happen.You haven't included environmental and social costs. For example,like the gentleman before me spoke, there is the Nelchina caribou herd that roams through this Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 26 area.I've spent a lot of time hiking back in this area.The State of Alaska Fish and Game spends a lot of time and money and energy of the State money (sic)to manage that caribou herd.And with increased access,you're just going to ask for more problems.That's just one example.If you look at what the State of Alaska pays to manage that caribou herd and then multiply it by many of the other species that are out there, you're going to have huge environmental costs. 'I''d like to see R.W.Beck subcontract to somebody else to add these environmental and social costs into this document..... (Applause) -.-.-and that we,the citizens,and the State of Alaska should not accept it unless those are in there.Okay?You can pay another $400,000 or whatever it will cost to get that,and it will still amount to a mere pittance of the amount of money that the environmental costs will amount to when you look at a project such as this. I also would like to see written somewhere that Petro Star validate their numbers,their real numbers,for what their estimated growth is going to be,because most citizens believe that,one,we shouldn't be subsidizing a oil refinery and,two, that those costs have been grossly overestimated. So whether it needs to take a panel of experts or a panel of economists from people across the state and across Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 27 wno24 25 this nation to look at the numbers and say,'Yeah,in all likelihood,that's not going to happen,'because that's what we all know.Okay?And I would like to see that written and validated because the things that we've heard from Petro Star and their President have led us to believe that there's not any weight behind those numbers. I think I'll end there and just say that I oppose this intertie,representing the Valley Alaska Center for the Environment and the 120 of its members. (Applause) CHARLIE WANSOR Good evening.I'm Charlie Wansor,W-a-n-s-o-r.I live here in Sutton.I just have a couple of quick points to make. Has anyone taken into consideration what it's going to cost to upgrade the existing lines between Copper Valley and Valdez,which are deteriorated or soon will be?Also,the lines between Sutton and Anchorage? Eventually,Copper Valley is going to have to bring their generating capabilities up to a point to where they can supply backwards across this intertie.I don't begrudge them the money,but I'd prefer to see it go in that direction.And then further on down the road,when the federal government really wants this intertie to grid this entire state together, let them pay for it,not us.Thank you. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 28 (Applause) CLIFF EAMES My name's Cliff Eames,E-a-m-e-s.And for truth in advertising purposes,I also am with the Alaska Center for the Environment.I work out of Anchorage,and I will try not to take very long since Dori has already spoken for our organiza- tion,but I would like to provide a perspective which a few people have provided tonight. But since most of you are from this area,I'd like to attempt to represent people from other parts of the state, including people like myself who live in Anchorage,and look at this,as I think Chris suggested at the very beginning of the meeting,in the context,for one,of the overall state budget and last year's extraordinarily large capital budget,which I think a lot of us would like to see the legislature chip away at. And we have an opportunity here to not only return, in effect,the $35 million appropriation but also not forgive the $76 million in interest which otherwise would be paid if this were not an interest-free loan.Now,we don't yet pay state income taxes,but we probably will sometime soon.And we also have lots of ways that we can use our State monies, regardless of where those monies came from,and I think there are a lot better ways than on this intertie project,which is so unpopular through a substantial portion of the valley. Executary Court Reporting 626 Cordova,Suite 104 Anchorage.AK 99501 Phone:(907)272-4084 29 A lot of people have talked about the underestimated capital costs.We would certainly agree.The hourly labor costs,the cost of right-of-way acquisitions,the cost per mile,the static var compensator,all of this is pertinent also to the general feasibility,the question of whether Petro Star's demand will in fact increase as greatly as their one letter estimates.A lot of people doubt that. There certainly are concerns here about the impact on your quality of life that this intertie will have,and it is very true that many of you will have to live with that impact every day of your lives.So it's far more important to you than it is to many of the rest of us.But there are thousands of Alaskans who drive the Glenn Highway every year.It's one of the most beautiful places in Alaska;it's the first impres- sion of Alaska for a lot of tourists who are coming in from the east. It's a fantastic recreation area,not just for people who live near here but also for people in Anchorage,Palmer, Wasilla,and much of the rest of the state.We're concerned about those public recreation values,about the wildlife values,the impacts from road construction on fisheries,and so on. And finally,although we have gotten away from this in much of the country and in much of Alaska,it seems to me that,whenever possible,those people who are going to receive Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 30 the major benefits from any particular project that has sub- stantial adverse impacts should be bearing most of those impacts and..... (Applause) ....-not people either in this part of the state or in the Anchorage,Palmer,Wasilla area. And for that reason,alternatives which are likely to be more feasible anyway --either the Allison Lake project or new,more efficient generators --would locate those potential adverse impacts in the area where the benefits are going to be received and not in an area where benefits are not going to be received.Thank you. (Applause) ALEX HARRIS My name is Alex Harris,H-a-r-r-i-s.And I agree with a lot of the economic and philosophical arguments that people have given against the intertie,and I'm strongly against it.And what the emotional kicker is for me,and the reason why I'm really against it,is I start to think about what it's going to be like to be up at Kings River or back in the Chickaloon Valley or at Hicks Lake,or these places that I care a lot about and have been visiting for years,and seeing a big monstrosity there. , And I hope the State and the people don't waste the money on the project,but the thing that really bothers me is Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 31 WwW63)the impact to the valley.And the reason I live here is for the natural beauty and the ability to drive up the valley out of Palmer,out of Sutton,and be in the Matanuska Valley.And that --those opportunities are going to be impacted by the project,so I hope it doesn't happen. (Applause) NANCY BERTELS I'm Nancy Bertels,B-e-r-t-e-l-s.Well,the feasi- bility study's out,and irregardless (sic)of what it says, Copper Valley is still trying to pull the wool over the eyes of electrical consumers from Anchorage to Valdez. The study is based on the massive increase in elec- tricity that CVEA will need when,and if,Petro Star increases their power needs at least four times.Petro Star has given no definite indication that it intends to increase its demands by this amount. As a private enterprise,shouldn't Petro Star be asked to generate their own power if they plan to demand huge sources of power?The State of Alaska should not be handing out no-interest loans for the exclusive benefit of one private consumer with the fiscal crisis it is facing. Census figures don't indicate that the population of the Copper Valley will increase at a dramatic enough rate to warrant CVEA's continued pursual (sic)of just an intertie to provide cheap power rates.Both the Allison Lake project,as Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 32 well as the continued use of generators,would be more realis- tic uses of State money if CVEA is in fact concerned about its consumers. While the study may be correct in its figures on what the project would cost to build today,it does not address what it will cost in 1996.Nor does it address the cost of neces- sary components of the system like a static var compensator. And how about realistic figures for right-of-way acquisitions and the impact and cost of access roads on the local communi- ties? Financially,this intertie is beginning to smell like rotting pork.It's always been a rotten idea for the people of "the Glenn Highway.Ask the hard questions about CVEA and the so-called feasibility of this project.But most importantly, leave our quality of life intact.Use the $35 million to generate power by some other method,or give it back to the State. (Applause) HEARING OFFICER:Anyone? (No audible response) HEARING OFFICER:Okay.Well..... ,(Inaudible comment) HEARING OFFICER:Excuse me? (Inaudible comment) HEARING OFFICER:Okay.- Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 ,.33 MR.TAPLEY:James Tapley. HEARING OFFICER:T-a-p-l-e-y. JAMES TAPLEY You know,it's my understanding that this is the Railbelt Energy Fund.Well,I fail to see where the railbelt runs through here.I figured the Railbelt Energy Fund was for --you know,for the railbelt. (Laughter) That's what I thought.Anything that runs along the railbelt is what that fund was for.And I fail to see where there's a railbelt that runs through Glennallen. It's another inappropriate appropriation of funds,as far as I can see.You know.Thanks. | (Applause) HEARING OFFICER:Anyone else? (No audible response) HEARING OFFICER:Okay.Well,the --again,the public comment period for written comments runs through February 25th,and thanks for coming. (Whereupon,the proceeding in the above matter was adjourned) Execstary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 . Phone:(907)272-4084 34 CERTIFICATION STATE OF ALASKA ss. THIRD JUDICIAL DISTRICT|ereteeeeI,CINDY S.CARL,do hereby certify: (1)That the foregoing pages contain a full,true,and correct transcript of proceedings in the above-entitled matter, transcribed by me,or at my direction and supervision,to the best of my knowledge and ability. (2)That I have been certified for transcript services by the United States Courts. (3)That I was certified for transcript services by the Alaska Court System prior to January 1,1993. SIGNED AND CERTIFIED: BY:On Lux C0 pare:_2lela4 Cindy S.Carl ae anne Certified Court Reporter Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 'PARTIAL TRANSCRIPT OF PROCEEDINGS (Public Testimony Portion Only) CHICKALOON,ALASKA Friday,February 11,1994 Proceedings recorded by electronic sound recording.produced by transcription service. Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 Transcript 'PUBLIC TESTIMONY OF: SUE LIBENSON .. WARREN KEOGH .. ART EASH .... PAUL TWARDOCK . TABLE OF CONTENTS CHARLES WILLIAM LONEWOLF . KARL BRAENDEL . GARY HARRISON. JOHN LeMAY ... AL LARSON ... JENNY BAER ._ VICKY KINDSETH . CHUCK SPAULDING HERB FEY .... CHRIS ROSE soe LINDA KETCHUM . ROBIN McLEAN .. DONNA BRAENDEL . DAVID HARRISON . BILL ROOT ... GEOFF WHALEY .. LARRY BUCHHOLZ . BILL BOYLE... JOEL LARSON.. VERONICA SLAJER Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 PAGE 24 25 CHICKALOON,ALASKA -FRIDAY,FEBRUARY 11,1994 (Tape No.1,Side 2) SUE _LIBENSON "It's L-i-b as in Boy e-n-s-o-n.And as I stated earlier during the meeting,I'm --I live in Anchorage,and am very frustrated that I had to drive all the way here from Anchorage to give testimony and think that you're really overlooking that enormous population that uses the area.And it's unbelievable to me the economics of the use of the area, as opposed to just the use of the area for a power line,have not been considered. And I really don't think the feasibility study reflects the overall feasibility of the project because there are real economic issuesat stake here that are not having to do with producing power.Thank you. HEARING OFFICER:Anybody? MR.KEOGH:My name is Warren Keogh. HEARING OFFICER:Could you spell the last name, please? MR.KEOGH:K-e-o-g-h. HEARING OFFICER:Thanks. MR.KEOGH:And I'd like a copy --I'll give you a copy of my comments.The address is on there. HEARING OFFICER:Okay. Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501Phone:(907)272-4084 2 MR.KEOGH:P.O.Box..... HEARING OFFICER:All right. (Pause) WARREN KEOGH My name is Warren Keogh.I'm a resident and land owner here in Chickaloon,and I'm speaking for myself and my family,and I don't represent any organization.And I had some difficulty getting a copy of the full report,which I haven't had a chance to look at,except here --just for a minute here before the meeting started.So my comments are based only on the Executive Summary. I've attended previous public scoping meetings,or informational meetings,in Chickaloon or Sutton regarding the proposed Matanuska Valley intertie,and during the most recent meeting in June,I tried to express my feelings and concerns regarding the negative impacts of the possible construction of the intertie through this valley and through this community. And these concerns are ones of what the draft report would term "quality of life"and "environmental”concerns. And under the,quote,"Environmental Review"section of the report,the concluding paragraph on page I-9 states: "Potential effects on the community can be difficult to measure,and also,quality of life issues are based on subjective criteria and are hard to quantify." Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 3 Now,it's been my impression,when I've raised these issues,or other people here in the community have raised these issues in the meetings that have been conducted by the State,that little weight is given to these kinds of concerns.Either they -- either they're not understood,which I think has been illustrated here tonight a little bit,or they're discounted because they're not quantifiable,because you can't put a dollar number value on it. And there are two --well,there are two reasons why that is.The first is,and the report accurately states,that it's not easy,monetarily,to quantify subjective values.And the second is,is that not one of the active proponents,or not one of the evaluators of this project resides here.And they're --it's difficult,or if not impossible,for you who don't reside here to appreciate the magnitude of the positive subjective values many Chickaloon people give this place.And likewise,it's impossible to measure the magnitude of the negative subjective values people ascribe to impacts of the intertie construction through here. So you --what I'm trying to say is you cannot reside in Valdez or Glennallen or Anchorage,I think,and really know about this place and about the people who live here.And your absence does not allow you to respect and to know and to care for this place with the same feeling that I and others do.And not only do you value it less,I think,you devalue this Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 4 valley,and you devalue this community with this lack of respect.And it's my opinion that some of you have behaved ignorantly and arrogantly by assuming that people here are weak and acquiescent and uninformed. And you assume that this --that the land here has greater worth with a power line than without it.You view this part of the Matanuska Valley as just another place on the map that the intertie will be routed through.And I view Chickaloon as my home,and it's a place I care for greatly,and it's a place where I assume the intertie will not be routed through.So we're operating from different assumptions here. Your --all along,there's been this assumption that the intertie's going to go through here.I've --my assumption is that it will not go through here. Now,regarding the feasibility study,those funding this economic feasibility study and those conducting the study have arrived at inaccurately low cost estimates.The study is flawed in four ways: First,it appears that the untoward effects the intertie construction would have on land use value,recreation value,aesthetic value,and real land value are considered but not entered into the cost estimations because they are difficult to quantify.Since they are not easily quantifiable, they are omitted from the cost estimation.This omission renders the analysis incomplete,and this economic analysis Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-+084 ; ;5 24 25 methodology is inadequate,it's inappropriate,and it may indeed be invalid,and I think it is. Second flaw is if one does assume this questionable methodology has validity,one finds omissions here that create underestimated intertie costs.An example of such omissions occurred with the power line project in Minnesota in the late 1970s.There,initial cost estimates were inaccurate because of inept planning and because there was a failure to perceive the extent of local opposition to power line construction. Initial cost projections in Minnesota --the initial cost projection was $537 million,I believe,and unanticipated expenses added $703 million to the cost of the project,which more than doubled the expected costs,the total costs..... HEARING OFFICER:I'm sorry.Do you have a lot more to read? MR.KEOGH:I have one more..... FEMALE VOICE:Give him..... MR.KEOGH:.....four paragraphs. FEMALE VOICE:.....three of my minutes. HEARING OFFICER:All right.Go ahead. BY MR.KEOGH (Resuming): Okay.Among other omissions,the cost analysis for the preferred route,Alternate D in the study,does not account for costs secondary to the protracted legal action,acts of civil disobedience,acts of vandalism,and acts of sabotage. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 6 WwWWNSuch acts could occur and would certainly result in significant cost overruns for transmission line construction:engineering services,right-of-way acquisitions and permitting,construc- tion management,owner costs,and contingency costs. Third,projected energy requirements for CVEA customer Petro star are highly suspect.The energy projections are based on corporate statements alone,and it is my under- standing that the owner of one of the two corporations control- ling the Petro Star Refinery has a history of bankruptcy and insolvency.And if such is the case,how much weight should be given to future projections of a previously bankrupt,and potentially bankrupt,owner?The credibility of speculative corporate statements is extremely questionable,and these estimates of energy requirements may be inflated,and they certainly are tenuous. Finally,the intertie power supply scenario on Table I-5 on page I-15 of the Executive Summary is optimisti- cally low.The expected maintenance,operation,and management costs due to acts of vandalism and sabotage are likely greater than CVEA expects and this report predicts.Again,the power line through the --rural Minnesota is illustrative.Post- 'construction operations and maintenance were high due to the ongoing actions of angry rural citizens.Rates of load growth and fuel price escalation are only part of the equation for the intertie scenario that's depicted in the table that represents Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 7 24 25 the cumulative present value of comparable system costs. Thus,the --I'll cut it off here,one more para- graph. The draft report of the proposed intertie through the Matanuska Valley is flawed to the extent that I think it's unacceptable:The methodology used is inappropriate.The cost estimate for the development of the intertie is seriously underestimated.The projected energy demands by Petro Star are highly suspect.The feasibility level environmental analysis is inadequate.And the costs of the proposed intertie,com- pared to other resource alternatives,is inaccurately low. When cost estimates for the intertie through the Matanuska Valley are adjusted upward to reflect a more accurate value,other energy scenarios become Significantly more feasi- ble and economically superior.This study inaccurately describes the economic plausibility of the proposed intertie. This ill-conceived and improbable project,with its flawed economic feasibility study,is a disservice to the citizens of Alaska,and especially those of us that live here. (Applause) _ART EASH My name is Art Eash.The last name's spelled E-a-s-h.And I live in Anchorage,but I've held property up here for some time.I've used the area for recreation for almost 10 years. Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 8 My primary objection is a visceral one;like most. people,it's a visual impact that this project implies to one of the areas that I consider the most beautiful I've laid eyes on.in the state.From our recreation cabin,the view will be pretty well destroyed,from my perspective,and from that. angle,I'm completely dead set against the project. But I'm a former economist and urban planner, regional planner,that once evaluated projects like this and attempted to push through marginally viable economic programs, like I consider this to be,and feel that,from a professional point of view,the flaws are numerous,and some of them need analysis,most of which you've just heard about. But one in particular is the fact that,as you've already alluded to,the conservation elements of the plan haven't been carefully enough analyzed.And I'd allude especially to a really large project in Washington State that reached the point of almost 60-percent completion before it was realized that the program was so badly flawed as to stop the program altogether.And I could see that eventually happening, after the trees are cut and after the essential damage to the visual aspects of the project are already done. I think,ultimately,the last gentleman just mentioned the cost overruns that I'd consider to be real likely based on a number of factors.And I'd like to see the project terminated before it reaches that point. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 9 24 25 The single largest factor that bothers me about the reliance of the report,the draft report,and what's been receiving a lot of attention in the Daily News is the fact that too much reliance has been given to the one somewhat marginal and brand-new consumer named Petro Star of Valdez.It doesn't "appear to me to be a strong enough basis to go forward and destroy an entire valley's scenery for the sake of.That's my (inaudible). (Applause) (Tape Change -Tape No.2,Side 3) PAUL TWARDOCK -..-.r-d-o-c-k.I too actually live in Anchorage, and I've been guiding and leading trips up here for 10 years. ,My concern is the image of this area as a scenic, pristine area that people live in,make their livings,make their community is being damaged.Any project like this has an. impact on visitors'image of an area,and they're less likely to come to the spot.That affects me;it affects my liveli- hood.I don't think that's been addressed in this --the study at all,and I'm just totally against this project.And I really am. | HEARING OFFICER:Thanks. (Applause) (Pause) //T Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 10 CHARLES WILLIAM LONEWOLF My name is Charles William Lonewolf.My address is Box 1235,Chickaloon.I'd like to receive a copy of the tran- script. My family has a 40-acre ranch just north of Drill Lake on the upper portion of Chickaloon River Road.The most feasible route,according to your maps there,brings it to within about a half a mile of our ranch.I'd say we're going to be fairly significantly impacted,probably a lot more than some.But nonetheless,the gist of my comments,you know, reflects not so much the economic parameters that were con- tained within the framework of your study analysis so far but, rather,the lack of other important considerations that should also be contained within there that are conspicuously absent, as what's been commented on previously. , One thing that I find that's completely lacking is the aesthetic values that are associated with this project.I realize that it's very difficult to put a dollar figure on aesthetic values,but the fact that we're Alaskans makes it abundantly clear that most of us would rather be unemployed in Alaska than employed in the Lower 48.That's aesthetic values. I think that it is possible to put a number on that. I think that it's also clear that --you know,that we have other information that's also lacking within there,and that is that,you know,How do we consider what's feasible?Is that -- Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 11 24 25 is "feasible"defined by a consulting firm?Or is "feasible" defined by a community that's going to be impacted or bear the brunt of a project?. , I think that it's not only our responsibility as citizens to be involved in defining what's feasible --because that determines what we're willing to pay for.I'm not willing to pay a dime,right now,the way this project is envisioned. But I'd probably be willing to pay up to several hundred dollars on my electric bill yearly if the project were rede- Signed in such a way that it didn't impact my aesthetic values, that it didn't impact my envi---the other environmental considerations that have been outlined..And that has a major bearing on what's feasible. | , As you've already indicated,it's very difficult to define high,medium,and low development scenarios for the purpose of assigning a cost to a project.But I do feel that it is vitally important to us,as not only residents of the state but also people that are going to be the most impacted by this proposed project,for you to at least make some effort to place a dollar value on what it's going to cost us as residents. of the Matanuska Valley. That's the only comments I have. (Applause) HEARING OFFICER:Anybody? (Pause) Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 12 MR.BRAENDEL:My name is Karl Braendel. HEARING OFFICER:The spelling on your last name? MR.BRAENDEL:It's B-r-a-e-n-d-e-l.Karl with a K. KARL BRAENDEL I'm a resident and a land owner in Chickaloon.I'ma big game guide,and I --as I said earlier,I pay the State of Alaska and the Moose Creek Chickaloon Native Association to trespass across their lands. This intertie would affect me directly in the area between Kings River and Strelshla Mountain.In fact,where you have one of --your favorite line route down a small valley on the back side of Strelshla Mountain goes right through a heavily used area of Da ---by Dall sheep.I've hunted right in that little valley,and you can always see sheep there. So,I mean,just the thoughts of this line going through a lot of this area really upsets me,and it would be damaging to my business because people don't want to see that. They see all that stuff where they come from. And the --also,the line would go through quite a large forest area between Kings River and Boulder Creek.That line would be hewed right through forest all the way.And that would provide access to motorized vehicles and just bring a lot more people into the area,which I don't particularly like to see.And also,it would be detrimental to my business. You know,whena layman looks at these plans and how Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 13 they were put --you know,how they're --all the numbers are sitting there and everything,and,you know,you can't really understand it all because you're not a part of it,and so you really have this idea in your mind that there may be a little sleight of hand going on in this study.You know,because there's so many places where just changing a little thing makes the plan come out a lot differently. And so you can't help that,and when I sit here and I "listen or I read the --this bare-bones evaluation here,you know,it doesn't really mean a lot to me because I can't fi--- I don't really know how you came to these conclusions exactly. And so,you.know,all I can really do is look at little things, I mean,some little thing,to see where the people are coming from and stuff. And one thing that I noticed is that in a meeting. here in Chickaloon last spring or early summer,a neighbor of mine asked Clayton Hurless if Petro Star was a significant factor in this --the intertie being a viable --to be viable financially,whether Petro Star was important to that.And he said no at that meeting.You said no,that it was not an important factor.And yet this little report right here seems to contradict that exactly.It seems to me like Petro Star is exactly the one thing that holds this intertie --the intertie possibility together. And moving along from that,and so when I see that, Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 'Phone:(907)272-4084 14 24 25 when you say no and then it comes out that Petro Star does seem to be the main reason for the intertie's viability,you know,I begin to think,you know,maybe I can't trust you.You know? Maybe you're not being forthright about everything.Maybe you just want the intertie for whatever reason. Then I come to conservation,which,as I've already stated in the meeting,I do not believe conservation has been adequately addressed in all these different scenarios.It was addressed in Solomon Gulch,with Solomon Gulch and diesel generation,but it wasn't addressed in the other ones. And it seems to me like a honest effort at conserva- tion,with some of the low electricity --electronic things that are becoming available today,it seems to me like conser- vation is a huge possibility for having a positive effect on which one of these projects might be the best project.And of course,of all these scenarios,the only one that affects us is the intertie. And it's obvious to me that you're here to sell us on the intertie,because any one of these other ones we're not a factor in.We're just plain not a factor.Those would all be done in the utility's own environment,not in our environment. So it's --you know,you get the feeling that the intertie is it.There really isn't --these other ones are just shadow dancing there. And of course --and my last statement is the fact Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 15 that,you know,I guess the bottom line really is everything. Whatever is cheapest,in dollars and cents,is what you're going to go for.But,you know,I don't always buy the cheap- est car,or I don't always buy the cheapest of anything.You know,sometimes I'm willing to pay a little more for aesthetics or for something that works a little better. And to --for me,it works better that the power comes in the Copper River area;it works a lot better for me if it comes there rather than it comes through my --through here. That's all I have to say. (Applause) GARY HARRISON Hello.My name's Gary Harrison.I'm here again. There was a couple of new things I'd like to add tonight that I didn't say in some of the other ones. AndI don't think that this study takes into consi- deration the fact that people are going to end up having to pay for the upgrade of their lines when all of this power starts coming through the old lines,not only on that end,but if this is a true intertie and it's supposed to be able to ship power back,even on this end. The other thing is,is I was glad to hear that it's only going to be a $20 million break point -on this intertie, because I'm sure,with all of the people here that are against this thing,and all of the little things that they've left out Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 16 24 25 of this,that when they start adding them all back up,that $20 million shouldn't be that hard to reach,even if you adjust it as much as it has been adjusted. And I --once again,I'd like to say that I'm totally against it. (Applause) JOHN LeMAY My name's John LeMay,L-e-M-a-y,Post Office Box 1230 in Chickaloon,and I'd like to have a copy of the minutes from this proceeding. I'd like to speak just for a minute on the figures in the feasibility study projecting economic growth.I've worked for a total of five years as a weatherization contractor in the Copper River Valley,from Mentasta Village all the way down to Valdez.I've worked in Copper Center,Gakona,Gulkana,Lower Tonsina,Chitina.And what I've found in those communities is a singularly bleak lifestyle;the economy is almost nonexistent.When I look around at industry,there is none. The people who'd come to me for jobs had absolutely no other prospects. | And yet we're told in this study that a certain level of economic development is going to come to pass.I haven't seen any evidence of this.Perhaps if some of these figures .were really looked at,coming out of Petro Star,they'd be found to be inflated and unrealistic. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 . 17 24 25 Our neighbors in the Copper River Valley open their arms to us and say,'Help us to have lower electric rates.' And at the same time,they live in an unorganized borough. They don't pay the kind of taxes that we do.They don't take responsibility for the schooling of their children on the same formula that's applied in this area. Yet what they want us to do is they want us to sacri- fice what caused us to live and purchase our land and be productive tax payers in this area.They also want us to underwrite this intertie by the eventuality of higher electric rates coming from our own co-op. , I'm very much against this.The --and wearing another hat,I'm also the current Chair of the Chickaloon Community Council.I'd like to redirect attentionto the fact that the Chickaloon Community Council has gone on record with the Mat-Su Borough by filing a resolution against the construc- tion of this intertie within our planning area. We are a seated Community Council.We have a compre- hensive plan;we have a special land use district in place. Interties fall under the heading of conditional use projects within our community,and it'll be at that level that our community attempts to stop the construction of this ill-planned project in order to'try to maintain the quality of life and the integrity of not only our community but the community of Sutton,the community of Glacier View,Sheep Mountain,and Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 18 Eureka Summit. I find it ill-planned;I think that these numbers are being forced,and I don't think they reflect reality. (Applause) AL LARSON Al Larson.I'm a retired lineman;I've been 25 years in the trade.I think that the cost that they placed on build- ing a line from here to there is drastically understated. I'm sure that the Board of Directors from Copper Valley here know the price they paid for that line that goes from Glennallen to Valdez.And they're going to running into a Similar situation,the same kind of terrain,between here and there.And are those costs reflected in your price evaluation in all the different --where --the way you calculated your cost per mile? The cost per mile of the Ber---what was that?-- Bernice Lake?Not Bernice Lake.Anyway,the last one they just built down there was $500,000 per mile,a half a million a mile,and you're looking at 130 or 140 miles.It just doesn't compute.It doesn't reflect the access roads should they use the red route that they show,the cost of building roads and then bringing the material in there so they can do the job. These towers don't just sit on the ground;they have to sit on pilings.They need to get a pile-driver in there to put the pilings in place.They have to have these access Executary Court Reporting 626 Cordova,Suite 104 o Anchorage,AK 99501 Phone:(907)272-4084 19 24 25 roads.It is definitely a direct cost.They're nowhere near close.It would be more realistic,if they wanted cheap power, to build something right close to their own neighborhood where they don't have to impact the whole state. _Their water,or hydraulic --or hydro,is the cheapest available power.It's not a nonrenewable resource.I think they should look that way.They're elected to their Board,and I think that if they want to stay on that Board, that they need to maintain a line on the rates their customers are paying.And I've been told that it's going to be their decision on proceeding with this,and I think they should take a long look at where they want to be. (Applause) JENNY BAER My name's Jenny Baer,B-a-e-r,and P.O.Box 245, Sutton,so I can get a copy of that. I appreciate the position the consultants and State employees are in;you have my sympathies. The main source of the feasibility of the intertie stems to Petro Star Refinery,which will be the largest buyer of the electricity from Copper Valley Electric.Power from the intertie,if built,will come on line in 1998,at the earliest, using Fiscal Year '93 dollars of $45.9 million,at a low esti- mate. If Petro Star gets its fuel to refine from the Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 20 Alyeska Pipeline,which could stop produc---or pumping fuel as soon as 2013,then power from the intertie would be bought from Petro Star for 15 years only.The intertie itself will take longer than that to be paid off,even being granted a 0- percent loan. I am not in favor of State dollars being spent on Copper Valley Electric power line.My suggestion is that Copper Valley Electric fully explore the Allison Lake project, which would utilize the Solomon Lake Hydroelectric Plant that is currently in operation. I feel that each area,such as Copper Valley,should produce their own power for safety and reliability factors.I do not think that the dollars generated by companies --recre- ational companies have been fully defined as to the impact of the power line --the negative impact upon their dollars. I feel that one power scenario is missing in this whole scheme,and that is purchasing excess power from Alyeska. That may or may not be [a]reliable power source,but I'1ll leave that up to you to define that. Legislators viewing the data from this report and the reports preceding it will view only the Executive Summary and not the public comment on the back of Volume II.I would like you to reflect our statements in the Executive Summary. Please do not allow an intertie to pollute the upper Matanuska Valley.Thanks. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 21 (Applause) VICKY KINDSETH My name is Vicky Kindseth,K-i-n-d-s-e-t-h,and it's P.O.Box 1200,Chickaloon. I live in this area with my family,my four children. We chose this area because.of its beautiful nature.I'm vehe- mently opposed to the intertie,especially in lieu (sic)of the feasibility study having no factored costs of environmental or social impact. We now live in an age of changing focus from economic gain to conservation of priceless resources.This study has been skewed to allow the power of money to speak stronger than the strength of the communities and people directly affected by it.There's little to no public comment included in the study. What kind of government and political process can condone this type of treatment of the people who live and work in the areas involved?The ramifications of this treatment will cause repercussions for decades to come.We cannot allow this inter- tie to be built and fill the pockets of big business. Please weigh heavily these public comments because we are truly a force to be reckoned with. (Applause -Inaudible comment) CHUCK SPAULDING My name's Chuck Spaulding.I live in Chickaloon, P.O.Box 1129. Executary Court Reporting 626 Cordova.Suite 104 Anchorage,AK 99501 ; Phone:(907)272-4084 22 oNOOAnd needless to say,I don't need to reiterate why I live here.I was involved in the Chickaloon land planning process,and I think the fact that Chickaloon was the first community in the Matanuska-Susitna Borough to actually imple- ment a land plan says a lot about the people and the place that it is. Lifestyle-wise,I needed to find a business that would support myself while living here,and 20 years ago,I was involved in an aspect of tourism that was new in Alaska called Adventure Tours.I started the first rafting business in Alaska,and I looked for a location that had all the physical characteristics that could get an industry like that off the ground.People would come up to me and tell me,rafting, rafting was an imbecilic thing to get involved in. I found a location;it was 75 miles northeast of Anchorage on the Matanuska River.It had all the physical characteristics I needed,from Class I to Class IV whitewater, it had capabilities for doing horseback trips,mountain climb- ing,mountain biking,you name it.There was all these things that were said in here.And what it didn't have,it didn't have a specific destination that could be controlled by any of the major tour companies. A lot of time has passed;tourism has finally become an acceptable industry in the state.In the last 10 years now, adventure tourism has become the fastest growing segment of Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 : Phone:(907)272-4084 ,23 tourism in Alaska. And a number of my tours are going to be tremendously adversely affected by this intertie,specifically,the Chicka- loon River,the Matanuska River in several segments,specifi- cally,just below Anthracite Ridge,and I'm totally against it altogether.I just can't imagine it coming in place.And I can't imagine that any of the other tour operators that we work hand in hand with could possibly grow if this intertie was in place. (Applause) MR.FEY:My name is Herb Fey,Post Office Box 1101, Chickaloon. HEARING OFFICER:How do you spell your last name? MR.FEY:F-e-y. ) HEARING OFFICER:1101. HERB FEY I've been a lifelong resident of Alaska.I settled in Chickaloon in 1974;I've been coming out here since the 1960s.I tooka hell of an economic loss by settling out here; I used to run a successful drywall business in Anchorage.By coming out here,I had to give that up.I feel it was worth it. I don't want this intertie to go through.I feel that the public utilities are saying,the same as the old-time utilities,"The public be damned."Their money counts;we Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 24 24 25 don't. That's what I have to say. (Applause) CHRIS ROSE My name is Chris Rose.I live in Sutton.Try not to reiterate all the things I said last night or the things I'm going to say in my written comments,but there are a few things that have come up tonight that I want to repeat.And I think overall,the thing that's come up has been the social costs that are involved,that are not being calculated in this meth- odology that has been used in the feasibility study. And various people have said that the ability exists to put numbers on these things,and yet no numbers have been put on the aesthetic values nor even the adverse impacts to the tourism industry here,which I think would be a fairly easy thing to put a number on.I think it's clear,from some of the people who own tourism-based businesses who've already testi- fied,that their businesses are going to be adversely affected. And that doesn't necessarily mean their business is going to go down,but what it does mean is the business isn't going to grow.And this area is prime for tourism to grow.As somebody has already mentioned,we're only an hour away from half the state's population,and yet we have some of the most pristine country that you can find,some of the prettiest country anywhere. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 . Phone:(907)272-4084 25 And people who have traveled all around the state -- I've been around this state a little bit;I still think this area here is some of the prettiest country in the whole state. And we are,in this methodology,totally ignoring the value of that place --this place here.And just because we haven't been able to put a dollar value on it doesn't really neces- sarily mean that there's no --there's not an adverse impact. I mean,it's ludicrous not to put a value on the adverse impacts to us the way you put a value on the positive impacts to the Copper Valley consumers in this study.I mean, it's all based on these values for the Copper Valley consumers, "when it's obvious that people make choices for other reasons. People make choices to gravitate toward places,and to preserve places,that are important to them. Like I mentioned earlier,this place would be a national park if it were anywhere in the Lower 48,and we would --this wouldn't even be an issue.This would be off limits.But because it's State land that --with fewer restrictions,this is even an issue that can be talked about. And I think it's crazy for us to be ignoring the value of this place,especially related to the dollars that you could put on it. Tourism is the fastest growing industry in this state,and.it's the most likely industry to sustain this Alaskan economy in the future --it's not going to be the oil Execcutary Court Reporting 626 Cordova,Suite 104 ' Anchorage,AK 99501 Phone:(907)272-4084 26 industry.So the quality of life issue,I think,has just got to be much more heavily embedded into the analysis. Some intertie costs that I think are grossly underes- timated,I mentioned some of them last night,including the labor and the helicopter costs.And we all have heard of cost overruns;I mean,I don't know many projects --Bradley Lake might be one --where there haven't been cost overruns.And Warren Keogh said earlier tonight that the power line he spoke of in Minnesota in 1978 was more than double the cost because of a lot of the civil disobedience that took place,that I know is going to take place in this area too. And those things --not just civil disobedience,but also litigation.I mean,there are various permits that are going to be litigated.There are --the whole issue of whether or not this process has been front-loaded,contrary to the way the statute reads,which says you've got to have a feasibility study before,appropriation,that's a liti---that's a issue that's going to be litigated. People's land values that are going to go down are going to have a cause of action against whoever tries to put a power line in their back yard.People with businesses whose value go down are going to have a cause of action against this power line. One thing that hasn't been mentioned is that,I don't care how many warning signs you put up on this right-of-way Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 27 under this power line,people are going to ride their snow machines underneath it,and people are going to ride their four-wheelers underneath it. FEMALE SPEAKER:And their horses. BY MR.ROSE (Continuing): And their horses.And they're going to get exposed to the megadose of electromagnetic fields,and those people are going to be affected.You're trying to take away this whole issue of EMF,which you've effectively done in a lot of ways by routing this away from people,and yet people are going to use that route.People are going to walk right underneath it because it's cleared;it's going tobe a grubbed 12-foot-wide trail,and I guarantee you people are going to use it,and they're going to be affected by those EMFs.So it doesn't matter if you put it 600 feet from a structure;it's going to be a effect that you better put into your analysis. I think the process here has been totally inadequate. And I know that the State has done the best job they can.I know they don't have to give us this public hearing.But I think it's real --really evident that there's a quarter mil- lion people 60 miles away who use this area and are impacted greatly by it and haven't been given a chance to talk about it.. And furthermore,it's State money that's going to be used for this project.So everybody from Ketchikan to Barrow has a stake in this thing,and it should be a statewide issue. Executary Court Reporting 626 Cordova,Suite 104 . Anchorage,AK 99501 Phone:(907)272-4084 28 24 25 It shouldn't be an issue where you can just,you know,have us, people who are living along a 60-mile strip of the Glenn High- way,the only people who know about it and the only people who can talk loud about it.Because I guarantee you,everyone I know who uses this areain Anchorage is against it.Anda lot of those people are represented here tonight. The process is also flawed in that there's no evalu- ation criteria whatsoever in the statute,and there's no regu- lations that define how the person who's supposed to be making this decision is going to choose.Is it low growth?Is it moderate growth?Is it high growth?You could put all the scenarios you want in the feasibility study;it's still going to boil down to a administrator choosing which one it is. And if you don't give that administrator any compe- tent direction in the feasibility study,it's just worthless paper because you are supposed to be studying the probabilities as well as the feasibility.The probability is that the only person or industry that's going to need this is Petro Star Oil Refinery. | Copper Valley's population has grown by .9 percent in the last 10 years;Valdez,2.69 percent in the last 10 years. If you look at the numbers of people and the businesses John LeMay talked about that are nonexistent out there,there's no other reason for this power line except Petro Star Oil Refinery. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 29 So it boils down to the question.of,Are we supposed to spend all this State money so Petro Star can have more elec- tricity?And the irony is they're in a place where there's more fossil fuel than any city in the United States of America --Valdez,Alaska.And if the technology for them does not exist to co-generate,then it --I mean,it's just ludi- crous to me that they're going to pipe electricity from Anchorage to Valdez for a company that makes fuel. (Laughter) BY MR.ROSE (Continuing): That --and we're even having to spend our lifetime, our hours and our days,fighting this when that situation exists;it's crazy. One of the other things that was brought up tonight that I thought was a really good point is the conservation scenario was not included in the Allison Lake and the Silver Lake scenarios.And combined with those scenarios,I think you might start seeing a few different numbers.I just think it's crazy that co-generation is not being looked at more effec- tively. I'm really anxious to see what the $10,000 that the Energy Authority is supposedly spending on a review of Petro Star's needs is going to come up with because if it comes up with numbers that show that Petro Star is really goingto grow more in order to enhance the feasibility of this intertie,I Execstary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 .30 24 25 think that things are even going to get fishier.And I'm totally against the project. (Applause) LINDA KETCHUM My name is Linda Ketchum.I'm a Chickaloon resident. I'd like to go on record as being totally opposed to the con- cept of the intertie. I agree with previous speakers that conservation could have been incorporated into other scenarios.And the exclusive emphasis on the dollar cost disturbs me,as I think equal or greater weight should be given to the environmental and social costs.It's high time you figured out how to quan- tify these costs so they can be factored into this and any future proposed construction projects. Finally,I would like to see our concerns properly reflected in the main body of the final version of this report. (Applause) ROBIN McLEAN My name''s Robin McLean,and I made a lot of comments last night,and I only have three more suggestions to you on how you can fix this for the final study. I suggest that you look at your oil price estimates and consider that the world --a lot of --I've heard on national news programs that experts believe oil prices are going to be substantially lower in the la---next 10 years Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 31 than they have been in the previous 10 years.And if you need sources for that,then I will try to find them,but that is a generally --not a bizarre belief,as far as I understand.So I hope to see that reflected in the draft --or the final. Then someone suggested tonight that there are numerous methods that the State of Alaska uses to assess social and environmental impacts,and I expect to see those reflected in the final study,along with all your other scenarios.and just bear with it;if you don't believe it,just do it.Just follow the directions. And then I agree with the some---one of the other people commented earlier that they hope to see our opposition to the intertie in the Executive Summary so that everybody can _see that who receives this Executive Summary. And then finally,I just have to say that when I got this,read this,feasibility study,I read it and I said, 'These people at Copper Valley are smart people.Why in the world would they think that this is rational?'I mean,it's clear that it's not a booming economy.I mean,Petro Star is a victim of the lowering --the lower price of oil.The -- there's less oil coming out of the North Slope.Why would Copper Valley want this?I don't understand this.Why don't they go after Allison Lake?The --I mean,that was much more rational to anyone who reads this. And Mr.Ritchey actually gave me this idea last Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 32 24 25 night,and he said,'Well,they don't have money for Allison Lake.They have money for the intertie.And how are they going to get money from the legislature now?'And that just made me realize:This is because you guys have money for the intertie,and you don't have money for Allison Lake. And I just hope that you guys like try and just be good people and go to the legislature and ask for what you really need,not what--for the money that you've already got except for some stupid project.Be honorable about this and read it and think of what you really need,and go ask the legislature for that.Don't waste our money on something you really don't need. | (Applause) MS.BRAENDEL:My name is Donna Braendel. HEARING OFFICER:B-e-r-..... MS.BRAENDEL:B-r-a-e-n-d-e-1l.And I think you have the address already,but if you don't,I'1ll give it to you. HEARING OFFICER:No,I don't have it.I don't have it. MS.BRAENDEL:All right.P.O.Box 1148,Chickaloon, Alaska. DONNA BRAENDEL It is my opinion,after reading the study,what I have read and what I can understand,which really doesn't say Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084.33 ) much,but I do feel that it's self-serving.It doesn't address the conservation issues adequately,and it doesn't reflect costs realistically,as far as I can see.There's a lot of things that are left out of it. After attending several of these meetings,I feel that the view of the parties involved is cavalier and indiffer- ent.As many times as we have voiced our concerns over our quality of life,the impact on our health,and the wildlife and the environment in general,the gentlemen who present this information seem unable to perceive any value that cannot be quantified by some monetary figure.Since the people who stand to gain from this expenditure of our tax dollars will not pay these nonquantifiable costs,they consider them negligible.It is my feeling that such matters are not adequately addressed in this study. , A corridor is a narrow space that has no eventful features and whose main purpose is to get from one important place to another important place.We are not a corridor. People live here.Their livelihoods are based on the type of place that it is because,for many years,it did not have the amenities to offer us that would make it worth it,except for the fact that it is the sort of place we can carry on the livelihoods that we enjoy,we can give the kind of lives to our children that we think are worthwhile. And what you're proposing to do is going to change Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 34 all that.This is one of the most beautiful places in the world.There are many such places like this.And a lot of them are gone,and they're gone because of the attitude that you seem to have about these places:If you can't put a mone- tary value on what they have to offer,then you can shuffle it aside because you can say,'Well,it has value to you,but it doesn't have value to Joe down the road.He cares more about something else.' Well,fine.But these places are going daily,and we do not intend to see this one go also.That is all I have to say. (Applause) DAVID HARRISON My name is David Harrison.I'm the Attorney General for the Chickaloon Village Traditional Government. What I've seen of this project,it is a bogus project,self-serving to MarkAir and the present Governor, Walter Hickel,the largest polluter in Alaska,second only to the military.This project does not take into consideration of the cost of what the people in the communities that are affected are going to have to pay for their health. It does not take into consideration the costs of the health of those animals and which we eat for our sustenance. You can go to the store,you can go to Carr's in downtown Anchorage,and buy your stuff.But this is my grocery store Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 35 out here,and you are going to devastate my food source.Not only my food source,but the food source of Chickaloon Village and the community of Chickaloon..This is unacceptable to us, and the community,from what I have heard. We have put you on notice that you have --are in violation of Chickaloon Village's environmental protection ordinance,and when you proceed to court,the strictest envi- ronmental standards are what's applicable.Chickaloon's environmental protection ordinance is much and far more stringent than the State of Alaska and is much and far more stringent than the federal government's environmental protec- tion ordinance because the Environmental Protection Agency is an agency to allow pollution;it does not protect the environ- ment.| The State of Alaska,in all its supposed wisdom,has to put back several millions of dollars.Why don't they take this money that they're going to put into this project,and why haven't they put the money that they put into the feasibility study,into the money that they have to pay back? Thirdly,the State of Alaska is not a legal entity because of the fact they were created illegally,without a vote of the Alaska Native people,who are still the rightful owners -and caretakers of all of Alaska,with exception of what they called "New Archangel,"which is considered today as Sitka,and a couple of ports on Kodiak Island and maybe one out on the 'Brecutary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 36 Aleutian chain.This is what the United States may have claim to. This project,from beginning to somewhere close to half to three-quarters of the way,is within Chickaloon Village's traditional jurisdictional area.We will be in the way of this project.We will be on the line if it is to go through.We will do everything in our means to stop this project and to hold those people accountable for the devasta- tion that they are attempting to do. If this project goes through the courts and it is found that they can go through,then there is a cost that you have not figured into this either.We will tax this line.We will tax it to the tune of a monetary amount that will pay for the health care of the people that you have polluted.With the amount of energy that is --would flow through this line,there is great cause for alarm,to the community,to the animals,and the natural world. The environment is the most important thing that is facing people today,and here you are planning to continue the pollution,to continue the acts --the criminal acts --of genocide by the creations of conditions that are calculated to bring about the physical destruction of the group in whole or part.This is unacceptable,and you will be held accountable for that crime. You are on notice.You can go look up the crime of Exccutary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 37 24 25 genocide in your criminal procedures book,Title 18 of the United States Code,§1091 through §1093,because these people don't care about the health of this community,the communities in which this line will run through.|Nor do they care about the health of my animals,as we have seen the Nelchina caribou herd go from over 100,000 strong down to 40,000 because of the pollution and environmental degradation that the State of Alaska and the federal government allows to persist here. (Tape Change -Tape No.2,Side 4) BY MR.HARRISON (Continuing): They have paid you probably fairly well.How much are you making today for going to these public hearings? (Inaudible response) It's overtime pay."It's not free because I'm having to waste my time here trying to explain to you guys that this project is not feasible. With all of.your scenarios,you have the lack of | respect for the people who you're trying to run over.The State of Alaska has tried to run over Chickaloon my whole life. You can remember what happened when Hobbs Industries tried to haul coal out of Chickaloon.You will have another incident similar to that if you try and build this project. However,it will probably be much worse than that because you see what's happened down in southern Mexico,with Chiapas,and the unrest down there because of government irre- Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 :, Phone:(907)272-4084 38 sponsibility and lack of caringness (sic)about the health and --of the people.You are going to have a Chiapas in 'Alaska if you continue to try and run this project over the people.Thank you. (Applause) BILL ROOT My name is Bill Root.I'm the owner of this estab- lishment where the meeting is being held tonight.I'ma CPA, and I have testified expert witness before the Public Utilities Commission. I'd like to bring up one item that hasn't been dis- cussed before,and that is the potential profits that the electric utilities can make as a result of this "free”State money.That is,they are allowed a rate of return which must be paid by the people who use their services.Approximately 12 percent is what's being paid right now,so if we put a $48 million system in here,the utility companies will receive an extra $600,000 a year of profits to them for having done nothing on their own. I think that's something that needs to be looked at and watched,and it's also part of the reason why the electric utilities want to have this go into place. I'm opposed to this project based on the way it is established right now.I do have this business here which is related to the tourist industry,and I would like to see that Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 39 24 25 protected.Thank you. (Applause) MR.WHALEY:My name's Geoff Whaley.I live in Chickaloon,Alaska. HEARING OFFICER:And the spelling? . MR.WHALEY:W-h-a-l-e-y.First name is G-e-o-f-f. GEOFF WHALEY I'm opposed to the intertie in any way,shape,or form.I'm also opposed to this study going any further than it is now because I feel that Copper Valley Electric Association has totally bought off R.W.Beck to make it come out the way they wanted it and,until there is an unbiased study done,that the legislature should totally shelve this thing.If it isn't shelved,I feel that the State Attorney General should start looking into investigating the way this procedure was done. (Applause) HEARING OFFICER:Others --anyone else? (Pause) MR.BUCHHOLZ:Edgar Blatchford --my name is..... HEARING OFFICER:Start with your name. MR.BUCHHOLZ:Start with my name?Okay.My name is Larry Buchholz.My address is Post Office Box 274,Sutton..... |HEARING OFFICER:I'm sorry. MR.BUCHHOLZ:.....Alaska.B-u-c-h-h-o-l-z. HEARING OFFICER:Okay.Go ahead. Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 ; Phone:(907)272-4084 40 MR.BUCHHOLZ:Post Office Box 274,Sutton,Alaska 99764. LARRY _BUCHHOLZ Edgar Blatchford,my name is Larry Buchholz,and I reside at Pinnacle Mountain Subdivision,a state lottery home- site we won back in 1985 for which we continue to attempt to get electricity into this State-sponsored subdivision.How- ever,so much for small business --or small users of elec- tricity because I am not a business.However,I'm not here to get emotional about my frustration,but it's an example. I want to make a comment about the time period comment and the fact that I did testify at Sutton,or babbled on is more appropriate.Five minutes is a thing that is diffi- cult for people to crowd all their feelings and understanding into. ) HEARING OFFICER:I'm not being real strict about it. MR.BUCHHOLZ:I understand.And you're doing a fine job. BY MR.BUCHHOLZ (Continuing): And I want to take this opportunity to tell you, Commissioner Brad---that I'd like to thank Dick and John for coming and doing a really great job.A State employee,I -- you're doing great work.I was one,and I acknowledge you. And John,you're a great salesman;good job.Your boss ought to give you a raise.The fact that you don't know what the oil Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 41 24 25 e cost (laugh)is another thing,but that..... Secondly,I'd like to thank and acknowledge all the staff professionals,you know,who have come here from CVEA and MEA because it's a tough duty.I'd like to thank Channel 2, who did a really good job of providing news coverage,and the Daily News and the News Miner for some of the stuff that they've been doing and will continue to do. And although we didn't have anybody here who repre- sented Glennallen with a --and Valdez that --as we had in Sutton,those people are to be acknowledged,too,because they took a bit of a rap from us verbally.And it's hard to do, because I'm sweating here telling you how hardit is to do. The HAARP project,the sensitive nature of the HAARP project,which is something that may impact on one of the dams, is a big issue,something that nobody --that we've kind of just glossed over.The HAARP project may be built in spite of the lack of this intertie.But we need to protest against that project and not participate and not encourage it because it's an evil project,okay?And if the feds are going to do it,let them do it.Let them force us;let's not us,the State of Alaska,do as we did and have done before.I could talk about the Exxon Valdez.Well,you get my message. Health and safety,the ecology,the environment,let alone the economic issues,and then we get down to political issues.We've assessed the economic issues,and that's what Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 42 the study reflects,and we've assigned no other value.What I 'heard Dick.explain as to what the funnel determines from all of our testimony is that,if I heard correctly,the major issue is the pristine wilderness disruption.That's values.That's -- that refers to values.What that is,is values. Now,we've got economic values,which we are --have assessed,versus all the other values that we can think of. And there's lots of them we've talked about. I meant to take out my watch and look at the five minutes because I'm real concerned that I could go on and on and on,and all of us could.We all have our feelings about this. The --how do they say it in technical terms?You know,all the aforementioned incorporated in my five-minute issue here,I don't want to take credit for it;I want you guys to take credit for it.I want you to take credit for it by including it.And although that's not your focus,that's not what your intent is,that's not what you were hired to do, that's what I'd like you to do. I am opposed to the intertie.I am opposed to it for all the reasons that have been enumerated here.And I am not swayed by the economic arguments that it should support and improve another area somewhere 130 miles slashed through the wilderness to get to. , I'm just speechless because I can't --I come to a Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 : Phone:(907)272-4084 43 meeting like this,and I attempt to encapsulate my feelings about what's been said and is being said,and I'm sure you're all caught with the same problem.The minute I get an idea, somebody says something else that I want to attach to,and that's one of the major reasons why the unfairness of this whole process deserves to be sued about (sic)and deserves to. be examined,because we're not represented. And that,Commissioner Blatchford,is what I would like you to do for us,is to consider us and to represent us and to hear us.And I trust that John and Dick will do their job and help to make that:happen. (Applause) MR.BOYLE:My name's Bill Boyle. HEARING OFFICER:B-o-y-l-e? MR.BOYLE:Yeah.HCO3,Box 8300,Palmer 99645. BILL BOYLE My only statement on this intertie is that I'm totally against it.I do believe that they have other alterna- tives.I believe that there's enough fossil fuel in Valdez, that --where they'1ll be refining this fuel,that they could take the hot water and whatnot and use it for steam and adda little oil to it,or they could build a power plant and sell you guys the oil to run the power plant,or there's a lot of other options.I don't believe that this intertie is needed. I believe that you could go to the State and get the Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 44 24 25 $35 million and take it down to Valdez and build a 10-meg or a 12-meg power plant to do everything you want to do.Or I feel you should go and tie into the new coal power plant that they're going to build over in --oh,now I want to think of the town,and it won't come to me. FEMALE SPEAKER:Healy? BY MR.BOYLE (Continuing): Healy,yeah.Tie in there.Go that way with it. Leave us alone.Do something different.Do something right. Get the hell out of here,Thank you. (Applause) MR.LARSON:My name is Joel Larson.” HEARING OFFICER:S-o-n? MR.LARSON:O-n,yeah.Box 3891,Palmer. (Inaudible comments) JOEL LARSON I'm opposed to this intertie.I'd like to say proba- bly the same thing --there was a lot of folks that said it here tonight.And it's a bit intimidating to sit up here and talk in front of a lot of people.I know I can feel my hands (indiscernible). , But from my house,I sit on my back deck and I look up at Castle Mountain.For me,my life will change.What I'll be looking is those 80-foot towers. You know,you got two proposed passages;one is about Executary Court,Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 : Phone:(907)272-4084 45 a mile away from my place,and the other one's about a mile and a half.And I know some of the other folks here,and I know just about where everybody lives-here,or I'd say 98 percent of them anyway.And that --what you got in your scenario,some of these people are a lot closer than what I am. And a lot of us come up --like you said,come up here and we live --to raise our families,and it's true,we give up something.Most of my work is in Anchorage,and I have to drive back and forth.Now,when I moved out here,I realized I'm going to have to put up with something:I'm going to have to put up with the commute.Or I could live in Anchorage,and with the hustle bustle of the traffic,which I did for three years when I first came to Alaska.But I decided to move out here because this was the kind of quiet,beautiful way of life that I wanted,not only for myself but for my kids. Now,earli---when I came here tonight,we dis- cussed,before we turned on the recorder and said,'Okay,this is an official meeting,'I have asked you,I says,'Is the impact that you are predicting of that,did you pick up from us people the fact that it's the beauty of the land,it's the businesses of some of us people who live here,whether it's trail riding,tourism,rafting,horseback riding,whatever it is?' I asked you,I says,'Do you understand that this aspect of the conversation is what we're dealing with?It Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 ; 46 isn't the intertie;it isn't the certain one route here,the other route there.That's not the --that's not what concerns us.It concerns us of our way of life;it's going to be changed,not only for us but our children,if this intertie comes through.'And you said to us,the way I predict,was, 'No,I didn't understand.I didn't believe --understand that.' | , I believed it was the route that was picked out.So tonight was,as far as I'm concerned,a great success,'cause I think at the end of this meeting,before we actually turned on the tape recorder,it was brought to your attention that it isn't the route,it's our way of life.And I,for one,will have to say I'm sorry,and I am guilty of,when earlier we were asked to,each one of us,sit down and write what it is about living here that's so beautiful that you do not want it changed and send it to the legislators or whatnot,and I didn't do it. I didn't.I sat down with that pen and paper,and I just --I couldn't put it into words. Sometimes you have something that's so dear to your heart,and so beautiful --and I've worked throughout,I'd say, 50 to 60 percent of Alaska.I'm a painter and a taper,and I work a lot of Bush work.And I'1ll tell you,I've heard --in my Opinion,the area between Palmer and 100-Mile,meaning 100- Mile on the Glenn Highway,is some of the prettiest land proba- bly in --definitely in the United --in Alaska and probablyin Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 co 47 24 25 the United States. 'Back in --up until about 1978,this land that's called Chickaloon,this area was called Paradise Valley.And there's a reason for that:Paradise Valley,'cause it was so beautiful here.And that's what all of us people think and feel in our hearts and our soul,that this is a beautiful place to live., And putting this intertie in is damaging not only the land itself,putting --as far as we're concerned,threatening our lives and,like David Harrison said,the animals,which,I look around the room here,and of the people that live here, I'd say 100 percent of the people hunt here.And he's right that we put,you know,food on our tables for our kids and for ourselves.And all of this is to be jeopardized for other people who have,you know,hundreds of other choices,as far as minerals and mineral rights,to produce enough electricity for themselves. Now,there's one thing I don't understand and I can't quite comprehend here tonight.And everybody tellsmethat there's one company in Valdez that wants this electricity and is a major (indiscernible).But yet you say in approximately 15 years,the outlook is that the pipeline is --will be shut down or come to a lower of a cease (sic)than what it is right now.And wherever you were,or wherever you're at,and you have a certain business that substains (sic)or holds up the Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 48° money value for the people who live there,comes to a screech- ing halt,the people leave. So in the long outlook plan,why are we going to. devastate our land for a place,in the future,that's going to come to a screeching halt,where there's a good chance the people are going to decrease,and there's going to be less demand for that intertie?It doesn't make sense.Thank you. | (Applause) VERONICA SLAJER Veronica Slajer,S as in Sam -l-a-j-e-r.I'm from Anchorage,and I'm a life-long Alaskan;thought I'd throw that in. I've been doing kind of an overview of several of the proposed interties around the state,and so I've kind of had an opportunity to look at some of the other studies. One of the things,if you were going to go back into this study and,you know,expand on some sections,I would recommend you expand on the permitting section.R.W.Beck did,I believe,a better job on the Tyee Swan Lake section -- on the permitting in parks,apparently,is because of the routing,the choice of routing.I don't know if it --you weren't able to commit on what your preferred routing is,but because there's so many sections of this --all these ro--- all the segments are controversial and will have a variety of permits necessary.I think,that would be a good --a definite Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 49 24 25 need there. Let's see.What else did T want to mention? Also,there needs to be a thorough review of the O&M costs.As mentioned on every --you know,whether it be permits or the --with the preferred route with the longer spans,you're going to have other structural considerations that may need to have a second look at it.We are actually in the process of looking at it more thoroughly,so I'm unable to comment at this time,but that's definitely a section that we will probably be encouraging you to go back and look at. Also,a question in my mind that I haven't had a chance to talk to Dick about,or anybody else about,is how do the other members of the Four Dam Pool,how are they going to be affected by this,is the --if there is truly a benefit in the way of rates going down.Is the rate --are they going to be realized by the people of Copper Valley,or are they going to be realized by the people --the other members of the Four Dam-Pool?And that's probably an easy answer,but I don't know.And it may be something this --to slip into the Executive Summary. I think the recreation section could --as we've heard today,.could be greatly expanded.It's about as big as the permitting section,which is a couple (laugh)of para- graphs.I think that's something you should look at.'And then also,within the environmental section,there's no reference of Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 .50 24 25 EMFs there,although you've made reference to EMFs in the consideration of route,meaning you decided to drop the route '.back off the highway because of the concerns to people.Those same concerns apply to animals,and those --most of the studies that have actually come out in the most recent,you know,times have been on cows in the Midwest and those kinds of things.So I guess the point is that EMFs affect animals,too. And I guess that's my comments for this evening. Thank you. (Applause) HEARING OFFICER:Anybody? (No audible response) HEARING OFFICER:Okay.Well,the written comment period goes through February 25th.So thank you for coming. (Whereupon,the proceeding in the above matter was adjourned) Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 Phone:(907)272-4084 51 STATE OF ALASKA ss. THIRD JUDICIAL DISTRICT I,CINDY S.CARL,do hereby certify: (1)That the foregoing pages contain a full,true,and correct transcript of proceedings in the above-entitled matter, transcribed by me,or at my direction and supervision,to the -best of my knowledge and ability. (2)That I have been certified for transcript services by the United States Courts. (3)That I was certified for transcript services by the Alaska Court System prior to January 1,1993. SIGNED AND CERTIFIED: BY:CHGS cane pare:_2lis/44CindySfCarl”- Certified Court Reporter Executary Court Reporting 626 Cordova,Suite 104 Anchorage,AK 99501 :Phone:(907)272-4084 TY STUDYLEYINTERTIEFEASIBILIwe ' ? |Append PUBLIC COMMENT IX ON DRAFT REPORT re "5 raeeas EON daces eat ACS -e790 .|re Ca ne tame ccnede esate saeACCORNK,swonase satelwren4 GLENNAELEN:OFFICE"RO:BOX649 oe OS re a re re ANCHORAGE OFFICE eet rr Par 406 W,FIREWEED LANGLEWNALLER,AK go5ge.7:ms re ee oi <mesos 101PHONO77.-a a "slhey "ANGHORAG AKE:1807),822-3476 :i .OE .PHONE:(9071 274-7662PAX:(807)822-3493 20 Som.FAX:1907)274-6614 March 3,1993 PEGEIMIS)To:The Alaska State Legislature MAR107 1993 House and Senate Finance Committees:COMMissiyCOMMUNITY ees LERe:Sutton-Glennallen Intertie &REGIONAL apAFFAIRS On behalf of the citizenry of the Copper Valley Region,especially the Ahtna people,it is with a sense of urgency that I write this letter in support of the Sutton-Glennallen Intertie. We support the construction of the Intertie for the following reasons:1)lower and more stable rates;and 2)increased economicdevelopmentpotential. First,the proposed Intertie is a long-term fix to the prevalentenergyproblemintheCopperValleyRegion.It could interconnect CVEA with the Railbelt Energy Grid and provide lower priced power to the Region while at the same time stable rates.The Intertie would also provide ample power to put CVEA's two diesel plants into emergency stand-by status,thus reducing the annual maintenance,repair,and operational costs.Placing the plants in emergency stand-dy status would reduce and almost eliminate the burning of fossilfuels, Second,it is no secret that we live in an economically depressed area. The Intertie would give us a jump-start to economic development. By lowering energy cost the citizens the money saved could be spent within the communities to spur the economy.Also,there is great potential for development of new business and industry in the arca, and the Intertie would be a positive factor.In the past this has not Alaska State Legislature March 3,1994 aPage2. been the case.When one learns of the high cost of power here,it has made good business sense to take one's business elsewhere. The construction of the Intertie would demonstrate that the legislature understands the reality.of a diverse Alaska,is aware of rural needs by having investigated the lifestyle of rural Alaskans,and is committed to meeting the needs of all Alaskans. Sincerely, re a.Bwan President/CEO RSE:dg &/G #:06L9S9P206 ND 'ONI 'YNIHV £Lb:9 0:P-L -8 AQ JNdS uy Buus WUUIU ICUUUC 42HU @ILUOSL CHINA LIC vUILLng UL 1USSU fuels. ayedileEroRept"o\be FROM:Mr.Clemet George Boucher PO Box258 Glennallen AK 99588 822-3684 CONSTITUENT SUBJECT:ENERGY MESSAGE:I REQUEST THAT THE FINANCE COMMITTEE TAKE A GOOD LOOK AT THE PEOPLE THAT THE INTERTIE WOULD HELP.WE HERE IN GLENNALLLEN NEED THIS INTERTIE TO REDUCE THE COST OF ELECTICITY.MY ELECTRIC BILL AT HOME WAS $400.00 THIS PAST MONTH,BECAUSE OF HEAT TAPE ON MY WATER WELL.. DISTRIBUTION 10 . , sore rere a oe Beemanome ates FROM:Mr.Kenneth Roberson -e PO Box 375 a Glennallen AK 99588 822-3363 f CONSTITUENT BES SUBJECT:ENERGY MESSAGE:I STRONGLY URGE SUPPORT OF THE SUTTO-GLENNALLEN INTERTIE. PLEASE RECOGNIZE THAT A RELATIVELY.SMALL GROUP IS OPPOSING A PROJECT THAT WILL BENEFIT NEARLY 6,000 PEOPLE.THE PROJECT ALSO DOES NOT PRECLUDE FUTURE DEVELOPMENT OF THE ALLISON LAKE PROJECT. IT ENHANCES THE POTENTAIL OF HYDROPOWER DEVELOPMENT DUE TO DISTRIBUTION POTENTIAL., DISTRIBUTION 10 VE 2 oo e™ e Ze?"Pe x)S3teeetttesahedetaoctetGageSethSRRrebaTERSwtotneta,*:iFROM:Mr.Jerry Toliman PO Box 377 Glennallen AK 99588 -822-3459 CONSTITUENT SUBJECT:ENERGY MESSAGE:PLEASE MAKE THE TIE-LINE FUNDING A PRIORITY.OUR AREA PAYS THE HIGHESTELECTRIC RATES"INTHE STATES"THERESNORELIEF iN SIGHT EXCEPT FOR THE TIE-LINE.PLEASE HELP INVEST IN OUR FUTURE. DISTRIBUTION 60 nicnanenennaates Harley Olberg -'A Mois 119 Leo Meat Representative Olbearg, Togust pecaived ory leash favortte mail--my electrical Lid?fiow the Copper Valley Electric Association.It takes a wey Taree chunk wut of our pay check,aften tt pases a real challenge to make the ends meet.We pay among the highest uneubsldlsed rates li the state of Alaska. T would Vike to put my support;;behind House Bills'50 &51,Senate Bills 106 &126,124 &1254for the intertie'and The possible AERA Reorganisation Plan.This would not only elabslice aro)possibly lowar my electrical rates,but camstriucbion Of this line could also produce jobs. Bhlactiblotlty ds such a basic need,please support these AV dss. Porecantty heard that radio station KCHI from Valdaz he seek bp TOOL OCS from the state to bring din KCHU to the Torso Riser Vatley.We already have a Jocal radio station whieh offers local news,Caribou Clatters and much community fuvotvementh Pueoteding local fund-raistng drives.We also haves averse Lay fin poblia radia station,KUAC,out of Fatrbanks which broadeast a number of the standard public radio program.1 DO NOT support state funding:--especially such a large amount--to expand coverage of KCHU.Wea are already getting adequate radio with local am radio as well as publieo radio atatton,KUAC.Ta put £80,000 down sa that, mo Oe,Tart two pubife radia stlaktuns could repeat "All Things.Cones ftdlerad'ud otlwr publbhe radio programs tChrovghouk the day would be a drrespansible use of funds.I speak for several in saytug we have adequate radio access and pleage,use the discretionary funds for necessary items such as an ambulance which ts badly needed hare Liu the Capper River Valley.Toll enclose the newspaper article mexarding ROT pss ih)e expatston fn bara and some of the commons ty feel dae. Ties you fron year Fb tamat ”oS-% B. _- FROM:Ms.Shana Roberta Anderson FE-PO Box 1956 rom,Representative4. . Valdez AK 99686 835-4281 Ol berg CONSTITUENT SUBJECT:ENERGY MESSAGE:I AM IN SUPPORT OF THE INTERTIE. DISTRIBUTION 20 -FROM:Ms.Janese Marie Chrystal PO Bow ae From:RepresentativeValdezAK99686835-2192 OLbera CONSTITUENT SUBJECT:ENERGY ' , adMESSAGE:I ENCOURAGE YOU TO SUPPORT THE INTERTIE. DISTRIBUTTON:20 aeenaneshFrom Repre sentative FROM:Ms.Evelyn Bunch :OLtberaPOBox314 Glennallen AK 99588 822-3221 CONSTITUENT SUBJECT:ENERGY MESSAGE:PLEASR.SUPPORT C.V.E.A.'S INTERTIR PROJECT.THE INTERTIEISOURONLYCHANGEATREASONSBLEPOSERRATESINTHEFUTURE. cae"yi _- _; a4 . ;re ne F :Mr.Jon P.ErwinFROMPOBox2081 From:RepresentativevaldezAK99686835-4560 -OLbers CONSTITUENT SUBJECT:ENERGYMESSAGE:I SUPPORT THE INTERTIE. DISTRIBUTION 20 ' VILL//94 PUBLIC OPINION MESSAGE SYSTEM POMS100-03:38:57 MEMBER OFFICE OLB Olberg RECEIVED LHSCKIM . WASTEBASKETFrom:Mr.=Ken Hugh PO Box 8 gnes APR 04 1994 Gakona AK 99586 Tel:ses gRSTOEIVIE |) 8 1994 Bill#Title:MAR 1 38SubjectENERGYnp urFICECOMMISsIUNE|IF :NOT RELATED TO SPECIFIC LEGISLATIONCOMMIINITY&RFGIONAL AFFA Message:ECONOMIC DEVELOPMENT IN THE COPPER VALLEY IS VERY MUCH DEPENDENT oN LOW COST ENERGY.THE SUTTON TO GLENNALLEN INTERTIE IS THE ONLY WAY OF ACCOMPLISHING THIS.PLEASE SUPPORT THE SUTTON/GLENNALLEN INTERTIE. 03/17/94 PUBLIC OPINION MESSAGE SYSTEM POMS100 08:43:46 MEMBER OFFICE OLB Olberg LHSCKIM ,WASTEBASKET 'From:Mrs.Barbara .Charley SR Box 225 Gakona AK 99586 Tel:822-3058 NON CONSTITUENT Bill#Title: Subject ENERGY NOT RELATED TO SPECIFIC LEGISLATION Message:POWER COST EQUALIZATION IS VERY IMPORTANT TO RURAL COMMONITIES.IF 'THIS IS LOWERED MOST FAMILIES WILL NOT BE ABLE TO AFFORD ELECTRICITY.ANY CUTS IN THIS AREA WILL AFFECT ALL RURAL COMMUNITIES. 03/17/94 PUBLIC OPINION MESSAGE SYSTEM //POMS10008:43:20 MEMBER OFFICE OLB Olberg ;LHSCKIM From:Mr.Warren :.Ulrich NASTEBASKET PO Box 211 Gakona :AK 99586 Tel:822-3071 . NON CONSTITUENT Bill?Title: Subject ENERGY NOT RELATED TO SPECIFIC LEGISLATIONMessage:I AM IN SUPPORT OF THE GLENNALLEN/SUTTON INTERTIE FUNPROJECTSHOULDBEKEPTFORTHATPURPOSE./NE DS FOR THIS 03/17/94 PUBLIC OPINION MESSAGE SYSTEM POMS 100 G8:38:32 MEMBER OFFICE OLB Olberg LHSCKIM | | WASTEBASKET From:Mrs.Julie Sine PO Box 266 . Gakona AK 99586 Tel:822-3542 NON CONSTITUENT Bill#Title: Subject ENERGY NOT RELATED TO SPECIFIC LEGISLATION Message:I SUPPORT THE INTERTIE BETWEEN SUTTON AND GLENNALLEN.DO NOT CUT THE FUNDING FOR THIS PROJECT.WE WOULD LIKE MORE STABLE COSTS FOR ELECTRICITY. 03/17/94 PUBLIC OPINION MESSAGE SYSTEM POMS100 08:45:29 MEMBER OFFICE OLB Olberg LHSCKIM WASTEBASKET From:Mr.Larry Sine HCO1 Box 1681 _Glennallen AK 99588 Tel:822-3542 CONSTITUENT Bill#Title: Subject ENERGY NOT RELATED TO SPECIFIC LEGISLATION Message:PLEASE SUPPORT THE INTERTIE BETWEEN GLENNALLEN AND SUTTON,AND DO NOT CUT THE FUNDING.WE WANT A MORE STABLE COST FOR ELECTRICITY. ae teed e 03/17/94 PUBLIC OPINION MESSAGE SYSTEM POMS100 08:40:08 MEMBER OFFICE OLB Olberg LHSCKIM :WASTEBASKETFrom:MR.Robert A.Frisbie PO Box 635 Mile .5 Tok Cut-off Glennallen AK 99588 Tel:822-3062 NON CONSTITUENT Bill#Title: Subject ENERGY NOT RELATED TO SPECIFIC LEGISLATION Message:I WOULD APPRECIATE YOUR SUPPORT OF THE SUTTON-GLENNALLEN ELECTRICAL INTERTIE.WE IN THE COPPER RIVER BASIN NEED THIS INTERTIE TO STABILIZE OUR ELECTRICAL RATES AND AVAILABILITY.THANK YOU. a .wakvbrowBeprenerors, VALDEZ CHIROPRACTIC CENTER LELAND P.OLKsJER,D.C. gy oF An =CaISWH3/7) MAR 11 1994gfet4yDolunWin.orripghS,0 RDERINNG:seemeR: NECEIVEDMarch11,1994 MAR 14 1994 Mr.Herv Hensley,Director oNDCRA,Division of Energy . SION OF ENERGY/OCRA 333 W.4th Avenue,Suite #220 Anchorage,AK,99501-2341 RE:Intertie Dear Mr.Hensley: I am writing to you on behalf of the Intertie proposal.As a current member of Copper Valley Electric Association (CVEA),I strongly believe funds should be allocated for this project. Three major benefits for the Valdez and Cooper Basin/Glennallen residents are: 1.Stability in rates or future rate reductions. One of the major complaints from myself and other members of CVEA is,"The rates are too high."CVEA rates have remained the same since 1985.My'major concern is with the deterioration of the diesel plants,our rates will inevitability increase. With the intertie there is hope for the rates to remain stable or possibly allow for rate reductions in the future. 2.Economic Growth New growth would allow competition between the business's.At this time we only have one or two options for most things,therefore we are forced to pay high prices for other commodities.This growth would also allow more jobs to be produced,© therefore,decreasing unemployment and helping the economy. 3.Safety &Health Alaska is the last frontier left in the world.I personally feel we should do everything possible to preserve our state and wildlife.The intertie would allow CVEA not to 'rely mainly on diesel generation which in turn would allow a reduction of exhaust emissions. Thank you for the consideration of reading my letter. Sincerely,, bilep>Latex,Cindy Frailey © some.Herv Hensley,Director 'Me CE Ly £9DCRA,Division of Energy 333 W.4th Avenue,Suite 220 MAR 14 1994Anchorage,Alaska 99501-2341 PIVISION OF ENERaY cpa Dear Herv Hensley,March 11,1994 I am very up set with the high price that my husband and I have to pay for the use of electric power,and still raise a family of six children Still all in school.Its $200.00 plus every month.If the power goes any higher we are talking about one of two things,cutting off the power, or just moving out of the Copper Basin.We don't want to do either. I ask you to please look in favor of the intertie,this will not only stablilize our rates,but might even lower them.At this point in time its hard for our local businesses to stay alive,and its almost out of the question that any new businesses even look at the Copper Basin for a future.Please,for the future of the Copper Basin,and for the good of Alaska,that we can all keep moving forward,I again ask you to look in favor of this interie. (predpe LatlaxCarolynBeshaw P.O.Box 586 Glennallen,Ak. 99588 REC=IWEMAR111994 vey IONER'S OFFICECOPPERVALLEYTeLapHONéCee OFRINNAN AFFAIRSCOOPERATIVEINC BOX 337,VALDEZ,ALASKA 99686 907-835-2231 FAX 907-835-2387 March 8,1994 Edgar Blatchford,Commissioner Department Community &Regional Affairs Community Building,Room 217 P.O.Box 112100 Juneau,Alaska 99811-2000 Dear Commissioner Blatchford: Copper Valley Telephone Cooperative,Inc.,is a non-profit,member owned cooperative providing communications services throughout a largeportionofSouth-Central Alaska.In addition to our primary switchingcenters,the nature of this area requires us to provision many small,remote buildings in which we house electronic equipment requiring AC power to operate.We have a constant first question we ask whenengineeringandplanningfacilities--what is the availability and dependability of AC power and what is the present and future cost of that power? This dependence translates into charges for electrical services from Copper Valley Electric Cooperative in excess of $90,000 per year--and growing!!Since we operate on a non-profit basis,any increase in those costs ultimately appears on our customers'bills.We have more than enough expensive obstacles to overcome in order to accomplish our goals,and strongly support any project which can help us keep the lid on our operating expenses as we intend to remain in business here for many years to come. The Sutton-Glennallen Intertie Project has the potential to stabilize rates--a direct benefit for our customers,most of whom live and work in CVEA's service area.It has the potential to encourage economic development--a direct benefit for our customers.And it addresses future need for many years--again,a direct benefit for our customers. We can only see positive returns through this project,returns which directly affect the pocketbooks of our 4000 customers through ouroperationsalone. As a utility,too often we find the expressed demands of a few override the unexpressed desire of the majority,especially where public works types of projects are concerned.I believe the benefits inherent in the Intertie far outweigh the alternatives,expecially from a long term perspective. Sincerely yours, Scott L.Smith General Manager '5 March,1994 MP 1093 Glenn Hwy. HC 3 Box 8484C Palmer,Ak.99645 Dear Commissioner Blatchford, We are writing in support of the Sutton to Glennallen Transmission Line Project and would like your support as well. We get our power from CVEA and pay the higest electric rates around (nearly .19¢KWH).We need this intertie to help stabilize our rates,to replace the dinasour generators that create our power,to help clean up our air and reduce the noise pollution (from the generators),as well as reduce the burning of fossil fuels., We realize the folks west of Caribou Creek (Chickaloon,Sutton, etc.),are not in support of this,but we feel that is because they have their constant power and could care less about the customers of CVEA or the future of the Copper Valley ElectricalAssn., We look for your support on this Electrical Intertie. Sincerely, Mary P.Howarth-Hernandez Michael D.Hernandez weenes EERIRsoMMINTTY&BF ACINAY vCal RAECEIVED;oo MAR9 1994BanHersDIVISIONOFenenerrocnk "Fh ¢Clenatlos.co MET ab onL CME.''S tle & Pilatmmg CVE.gr Ae com - Maemaa Bing freee Bluchane |eee:é Rmerrene Goones (eae hen 2D Bb ts,: ee sony Hoe pee aelehe Mt Seiten -Cbvcalton Levee te ae ste bee|fer fe me fo OVE,-_oe Alnota.Ger.lnctafeemoe|ein tome)Lo gpracn poorer a)Lo|-Wtiel2é spuotong,Agtie frilincl gaa auggeliid)|.amen hs is dost pathy Tae,,sal ee Baa tame nt Villy tom ep frabaloneEVERLetefpuctceNok.foe "gory,90.%6 Mo egy A yeah:See hgh fon "5 torko bend.”ae iat PiKerifreeeves thew Thee trtlin fe- |ac tenant atin CVEM.Lo)eine het .gee "Aaan\ PDTeyewest 2 of FawSOMMRINTY8REGIONATAEEAIR 3 Nick ZethanesMarch7,1994 -,PO BON 477Referenceto: :Glenuallen,ak .9958§Transmission Line from ;Tel 907 822 3.4%]Sutton,to the copper River basin. Gentlemen: As you are aware,Many people are on the bandwagon,wheaneabletofindmanyfaultswiththisnewproposalprepoclfer thednteatybetweenthetwoareas,, What do I see in all of this,nothing that is not now,there has \been the same propaganda spread ahout 4a many other pregrety ou oothisstate,WHY??fo4 personal reasons,or sometheng Co de.thattheydonetreallyunderstand??, .How many people remember the huge static that was racésed ahout theoffdiscoveryinthisstate,and its transmission Cines,abso onthehugegasline,from the KENTA peninsula to the Anchorage hett,and into the Matsu valley.Has all this hurt the state,én anyway,Definetely not,but it was all.a contribution towards theadvancementofthegrouth,and the prosperity that we do nowenjoy,yes there was some faults in the-process,but these errorsaretobeexpected,and we must lookat!the overall picture,and see the end results for the betterment of the peopfe andtheabilitytogoforwardintothefutureneedsofthisgreatState.Some sy that the preposal ofa dam 44 the most Logicalproposalforenergyinthecopperriverbasin,including Valdez.and some say that the main season for this,is due to ane CittterefineryinVALDEZ,how wrong they can be,that is only one ofaeasons,are they not Locking at other avenues of qrouth that witloccunr??. ; T xemember when the SOLOMON GULTCH project was initiated,withthestudiesmadeatthattime,were they coanect in theirestimatesofthefuture?,«¢seems that they were off baseiontheircalculations,the dynamos installed,and the amount)ofhaterusedtooperatethegenerationsystemwereobseliteinawearyshorttime,and we had to continue to use the diesel powergenerationsystematagreatcost,with@ut the rates being Cowe red.With the construction of a dam,we woukd be garanteed only only15>GF MGW of power,with no additional powerdn reserve.Again,we would have to depend on diesel generation for a backup.Does that make sense??OE Kinately not,Who can say for sure whilwilltheamountofelextricitywillbeneeded(nm ten yeans?? withe.the interty system,we would have dm our hands,a systemthatwouldprovideuswithasurplusofpower,that would be abtetohandlealargergrouthinthisareaforaLongerperiodoftame.1t does not make any sense,fo turn aroundivery ten on twelveyears,and fight for funds to expand more energy into the same Isarea,with that type of surveys,feeds to hootiah spending of fundsthatcouldbeusedforotherworthyprojects.-:a wonder,how many people who do these studies,ever took atwhatthecostoverunsareonthesedamprojects?,1h my mem eestilefunctioning,The Solomon project,ends ete aaavey..ch as the cost estimate.of t ose that dé re . ith the construction of the taanamission Cant then would be a . fe t,with notany appreciable cost overuns.ined Aacton,being that with the interty,we would have @ veamountofenergyonhandthatwewouldnothavewiththeproxtion.oo.;i"an Cree ok you te take these potuts cr sercous conséiderateonforyourfinaldecisononthisproject.Thank youNickZerbinos "tk CNG foe Edge co,;Lom w ith ng Thrs pore.a40.Supprt.the praised..Sif fOr7 +FO Olen rien Rens ini $67 64 LFA?Thenhts = Gete R-vat $.-gawamany os eatherRMARIO?1293 y Vrlinen)A OFFICE'insar AFFAIRS q 764 = RECEIVEHervHensley,Director . verveD DCRA,Division of Energy 333 W.4th Avenue,Suite 220 MAR 16 1994 Anchorage,Alaska 99501-2341 DIVISION OF ENERGY /DcRA Dear Herv Hensley, | , March 10,1994IamwritingastotheSUTTONTOGLENNALLENTRANSMISSIONLINEPROJECT. As a family of eight,living in the Copper Basin we find it very hard some months to come up with the $200.00 plus for our power bill..I would like to see anything that would bring a stop to the rising cost per KW., and to give us all a little added insurance.I am referring to the old 'Dinosaurs we now use to generate power for the Cooper Basin.These generators are very old,and cost a lot to run,plus the repairs,which are all passed on to us in our monthly bills. If something doesn't happen to lower,or at least stablilize our power rates,I'll have to drop our power,or move. I ask you to please look in favor of the intertie,this will not only stablilize our rates,but might even lower them.At this point in time its hard for our local businesses to stay alive,and its almost outofthequestionthatanynewbusinessesevenlookattheCopperBasin for a future.Please,for the future of the Copper Basin,and for the good of Alaska,that we can all keep moving forward,I again ask you to look in favor of this interie. Sincerely, -\.. Ronald Beshaw P.O.Box 586 Glennallen,Ak. 99588 RECEiVeD Z 6,NOY ag:ye tho calor Xf 2 AA wksVitcieAl NY ©Zago =\Municipality of Anchorage Municipal Light &PowerTomFink,Mayor 1200 East First Avenue Anchorage,Alaska 99501-1685 (907)279-7671,Telecopiers:(907)263-5204,277-9272 March 25,1994 .BY FAX AESEIVED Herv Hensley,DirectorDivisionofEnergy,DCRA |MAR 30 1994 333 W.Fourth AvenueSuite220 .DIVISION OF ENERGY/DCRAAnchorage,AK 99501-2341 Dear Director Hensley: I am writing to you to give my opinions on the proposed Copper Valley intertie andAlaskanintertiesingeneral.For some reason all significant Alaskan interties have haddifficultstartsandhadtoovercomemanyobstaclestogetunderway.There are likelymanyreasonsforthisbutoneconstantpatterniswhatIwillcallthe"Big.DealSyndrome".For some reason consultants are prone to try to make the project into thebiggestdealpossible.Possibly this is any attempt to justify higher fees. The first time I ran across this was when the present Alaska intertie was being studiedforfeasibilityandsomeoftheinitialstudiesindicateditwasnottechnicallyfeasiblebecausethephaseanglechangeoverthelengthofthelinewastoogreatforstability.Investigation indicated the phase angle shift was acceptable in the line proper but theproblemwasinthetwo138Kvto230kVtransformersateitherendoftheline.Byoperatingthelineat138kVandeliminatingthetwotransformersthelinewasfoundtechnicallyfeasible.Incidentally,the study which indicated non-feasibllity was theofficialstatestudyandthestudywhichindicatedtechnicalfeasibilityatthelowervoltage(by virtue of eliminating the two transformer impedances)was an independentstudysponsoredbytheChamberofCommerceEnergySubcommittee.For somereasonthissamethemekeepsgoingonandonlikeabrokenrecord. The key to this first problem was that the consultant insisted on only looking at lines of230kVandabovebecauseotherwiseitwouldnothavebeensucha"Big Deal".Afterall,there was the real danger that at 138kV it could have been built by ordinary utilityengineers.Of course at that time the State had lots of money and we were able to pickavoltagethatworkedandstillbuildfor345kV.Nevertheless,the basic problemstartedinattemptingtomakethetielinea"Bigger Deal"than necessary. Now coming closer to the present time we have repeated the same mistakes with thenorthandsouthrailbelttielines.The State studied them at 230kV and possibly higheragainmaximizingthesizeandcost.They also studied the existing lines pushed to theabsolutelimitwithstabilityenhancementsbutthatofcoursedidnotevenaddressthefirmpowerrequirementsothisdoesnotrefutethe"Big Deal Syndrome”which also inthecaseofthenorthsouthintertiesresultedinaninitialfindingofeconoicnon-feasibility.The utilities,after much effort and cost,produced a scaled down 138 kVvresionwhichwaseconomicallyfeasible. Putting Energy Into Anchorage Herv Hensley,DirectorDivisionofEnergy,DCRAMarch25,1994 Page Two There was one other factor in both past experiences.Motivation.With the originalAlaskaintertietheinitialstudiesweredonebyafirmwhichhadnoparticularmotivationtoproduceaneconomicalorworkabledesign.The study done by theChamberwasdoneattheurgingofmyselfandBobHuffmanwhowasthentheGeneralManagerofGoldenValleyElectricAssociation.The new engineering was done byBobRutherfordwho,of course,wanted to see improved electric systems in Alaska.Itwasdonebypeoplewhowantedtoseetheprojectsucceed. Coming now to the Copper Valiey transmission line from Sutton to Glennallen we areseeing,unfortunately,some of the downside of the "Big Deal Syndrome".Big steelstructureswhichwillmaketheprojectabigjobwithbigdesignfees.Now this is nicetoutilitypeopleiftheycanaffordthembutlookaroundAnchorage.The 115kV and138kVlineswhichcarrymorepowerthantheCopperValleyintertiewillthirtyyearsfromnowarebuiltofwoodmostfrequentlyonsinglepolestructures.They are alsodesignedbyordinaryutilityengineersandbuiltwithregularutilitylinecrews.I assureyoutheyworkjustfine.No,I am not saying there are not some places on this lineroutewherestrongerconstructionisneededbutthereisalotwhereitisnot: Not only does the "Big Deal Syndrome"increase the cost and lower the economicfeasibilityitalsoalarmsthepublic.Nobody wants a great big transmission intertie intheirbackyardoriftheycangetawaywithitintheirvalley.Now when it comes toyourneighborhoodtransmissionlinesupplyingyourowncommunityIthinkbothyouandIknowthatitwillgobeyondSuttonbeforetoolongandonewilllikelystartwestfromGlennallenbeforetoomanyyearsbutpeoplewon't mind that.In fact,most ofthemwillneverknowthereneedstobenodifferencebetweenthatlineandtheSutton- Glennallen intertie. Finally,I want to get back to motivation because this is where the problem lies.R.W.Beck wanted a big study and they maximized the size and strength of the line.Perhapsifinitialcostwasnoobjecttheymightberight.However,I know of no electric utilityinAlaskathatissowellofffinanciallythattheycandotheirownworkthatway.Wemustlivewiththerealitythatthelowestlifecyclecostmaynotbe,in fact,usually isnot,the economically feasible place to start when one must conform to real worldeconomics.I truly feel this project is not being designed and analyzed by peoplemotivatedtotrytomakeitworkataneconomicalcost. Another aspect of this project is how does one plan in the face of uncertainty.IunderstandbasedonacertainpervertedlogictheAllisonLakealternativemightbeconsideredthemostfeasible(though certainly not by any Copper Valley customer)alternative under a moderate growth alternative but not under higher growths.In thistypeofsituationitseemsmostreasonabletoselectthealternativewhichworkswithawiderrangeofpossiblefutureseventhoughitmightbeslightlysuboptimalundersomeconditions.Of course if we would just decide to build a less costly line thedilemmawouldevaporate.. Herv Hensley,DirectorDivisionofEnergy,DCRAMarch25,1994 Page Three I urge that the Copper Valley intertie be found economically feasible because I amcertainthatitisifreasonablerestraintisusedindesignandconstructionandopenandcompetitiveprocurementisadheredto. Before closing I want to discuss another intertie which apparently was not a success butwheretheconceptwarrantsfurtherinvestigation.That is single wire transmissionwhichintheoryshouldgreatlyenhancetheeconomicsofinterconnectingsmalltownsandvillages.Possibly too many things were tried at one time.I know innovativestructureswereusedalongwiththisinnovativetransmissionconcept.There is also thepossibilityofsinglewireDCtransmissionortwowire,either DC or AC if the earthreturnproblemsareinsurmountable. Very trubyyours, a Thomas R.Stahr General Manager Alaska State Legislature SENATOR FAIRBANKS BERT SHARP DENAL!BANK BUILDING DISTRICT P 119 N.CUSHMAN,SUITE 201 FAIRBANKS,ALASKA 99701 CHAIRMAN (907)452-7885 /7886 TRANSPORTATION COMMITTEE -SESSION ADDRESS MEMBER STATE CAPITOL,ROOM 514 FINANCE COMMITTEE JUNEAU,ALASKA 99801-1182 LEGISLATIVE BUDGET &AUDIT COMMITTEE (907)465-3004 /4921 HEALTH &SOCIAL SERVICES R E C E i V E D APR 0 4 1994 /DIVISION OF . March 30,1994 ERO x)QP) Hce Mr.Herv Hensley,Director Division of Energy Department of Community &Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,AK 99501-2341 Dear Mr.Hensley: I have reviewed,in detail,both the Beck draft feasibility study and the CVEA data and information in their Comments Package. It is very apparent the load and power cost forecast contained in the CVEA Packet tracks past actual historical data and more accurately projects that data into a more realistic forecast based on proven methodology. The facts that the tie-line offers over 500 percent more firm base load energy at a lower cost than the non-firm alternate to the Copper River and Valdez area is overwhelming justification for the highest feasibility rating for the tie-line. I have over 30 years of experience in Alaska being involved in long 'range load projections,power feasibility analysis and financial planning. One thing always came true in every forecast,Alaska's population will grow,it's economic base will expand and the demand for reliable competitive electric power will increase along historical trendlines. REPRESENTING GOLDEN HEART OF ALASKA wt Mr.Herv Hensley,Director,Division of Energy Department of Community &Regional Affairs March 30,1994 Page 2 I urge that you look at the long term benefits for the most people as you move your feasibility study to its conclusion.The economic viability of this vast area depends on your making the right decision. Sincerely, Senator Bert Sharp /mjw Oey.a Ap <7 vé,Sr,March 18,1994 |ane WI State of Alaska 4 Ne Department of Community and Regional Affairs Box 112100 Juneau,Alaska 99811-2100 Attention:Mr.Edgar Blatchford,Commissioner Re:Sutton -Glennallen intertie funding. "Dear Commissioner Blatchford: Being a resident in the Copper Valley and a large consumer of power from Copper Valley Electric Assaciation,|find it necessary that |write in support of the above noted intertie. During the last 10 years we have been operating a roadside business with same of the highest unsubsidised electric rates in the State of Alaska.There is no doubt that these rates have stunted the growth of our business as well as the businesses across our district.During our tenure here we have paid in excess of $100,000 to CVEA for our electrical power.If we had been in Anchorage,during that same time,consuming the same amount cf power would have cost us less than $35,000.For a small business like ours that differential is very important in planning our future. _Now we have an opportunity to do something really positive about the prablem.The legislature has allowed us sufficient funds ta finally bring in the railbelt power fram Chugach Electric (or another vendor)and place cost efficient power at our door far into the next century. Of course,any time there is a major issue on the table there are detractors.This case is no different.We find the detractors to be a small,but vocal!group of dissidents,living outside of our electric service area in the community of Sutton, They seem to be willing to do and say whatever is necessary to discourage the completian of this intertie,even if it means that they distort the facts,distribute mis-information and deviate from the truth.I,for one,find this unfortunate. There are about five areas upon which our neighbors from Sutton base their argument. 1.The intertie is not as good an alternative for additional power in the Copper Valley as Allison Lake scenario., The only reason CVEA wants this project is that it will help provide low cost power to Petro -2 Star,Inc.of Valdez. 3.The dollars used for this project are costing the state money and could be better placed in a savings account for a rainy day. 4.The cost of the intertie is underestimated by the study by many millions of dollars because it does not include the construction of something called a Static VAR Compensator. 5 The intertie will cross native land in Chickaloon and adversely effect the tourist businesses along the Glenn Highway. To rebut some of this mis-information,it is important to address each of these points from theviewofthemembersoftheCopperValleyElectricAssociation. First:With regards to the intertie not being the best of the scenarios offered;the R.W.Beck study is to this point guilty of omission of many urgent facts. e Alyeska owns the water rights to Allison Lake and uses them for providing water to the Alyeska Pipeline Terminus for fire suppression and cooling purposes.There is no indication that they are willing to abrogate those rights to anyone. e There is grave concern by the Valdez Fisheries Development Assaciation (Solomon Gulch Fish Hatchery)that any use of Allison Lake water requiring the over flow to enter Solomon Lake will increase the turbidity of the hatchery water to a level that will be detrimental to the over 200 million salmon fry produced by this important commercial and sport fishing spawning grounds. e Direct costs of generating power at Allison Lake are not spelled out in the draft report. Missing is the cost of additional power generation from Solamon Guich Damn by the Allison Lake tunnel.This comes to,in excess of,$800,000 a year and would have to be paid by CVEA members as the other members of the Four Damn Pool would receive absolutely no benefit from this power.That,in itself,puts the Allison Lake project millions of dollars higher than the intertie costs when amortized over 50 years. Second:CVEA only wants the intertie to increase their capacity so Petro Star,Inc. can increase its production. e We have been seeking ways to lower the power costs in our service area for all of the eleven years |have lived in this valley.Petro Star is only a few years old and whereas they are a major consumer of our power they are only one of many businesses needing power. e The Copper Valley is on the cusp of an explosion in tourism.With serious overcrowding at Denali,we are the best solution to the problem of where to put our 1,000,000+visitors each year (and that number is increasing at the rate of over 10%a year}.With this growth will come the paving of the Denali Highway,better highways into the Wrangell-St. Elias National Park,a road to Cordova,and increased business opportunities in Prince William Sound.All of these events will positively effect the business climate in our area. That means a greater need for additional power.With the stabilization of electric rates {and,just possibly,a reduction}other businesses will be able to enter our communities and that,too,will place a greater demand on the power needs. e Just imagine,what a service it would be to both communities if CVEA could find a way to provide power to Cordova.That community ran out of power a couple of weeks ago.They are in serious trouble.Maybe we can be part of their solution.e By completing this legin the grid we are just one step closer to providing low cost power to all of Alaska.Not only should we be completing this intertie,we should be looking forwaystoexpandthissystemontoTok,Delta,Slana,McCarthy-Kennicott and points beyond. Third:-The dollars earmarked for the intertie will be better used if placed in a savings account to earn interest for a rainy day. e Alli can say is,with the politicians fram across the state looking for every dollar,it would be political naiveté to believe this is a real solution to any problem.If these dollars are not used for the good of our communities,they will be used somewhere else and probably for something far less useful for Alaska. Fourth:The cost of the intertie is underestimated by several millions of dollars because of the omission of the Static VAR Compensator. e The equipment they mention is a device thatis necessary after the amount of power being'sent to Valdez reaches a certain level.That level is determined by many factors and may be necessary at some point in the future.At best guess,it will not be necessary until we are transmitting something over 16 to 18 megawatts.That will not occur until sometime after the turn of the century.Since it is not part of the actual construction of the intertie it iS not wise to include it in the cost of the intertie. Fifth:The effect of the intertie crossing native land and being a detriment to the tourist industry in the Sutton-Chickaloon area. e To placate the native population at Chickaloon the line design being considered is a path that will bypass the land selected by the Chickaloon Native Village.Thus,this problem is negated. e In order to be as unobtrusive as possible to the Glenn Highway traveler and the residents of Sutton,the line will follow a corridor 2 to 6 1/2 miles off the Glenn Highway.With the exception of a couple of very short sections,it will be virtually invisible to the highway.The vast majority of the Alaska tourists will never know the line exists at all. Of course there are other smaller points of contention coming from the rank and file of the loyal opposition but |think you can see from the above that their concerns are a result of reaching for a way to stop the project for personal and biased reasons rather than trying tofindawaytomakeAlaskaworkforAlaskans. We desperately need this system at the earliest possible time and J am certain that if we miss this window of opportunity it will be many years before we will have another chance to reduceourenergycosts,if ever. t implore you to think carefully of the impact of your decision on the populations and business communities of Valdez,Glennallen,Copper Center,Gakona,Gulkana,Tonsina,Tolsona,Tazlina, Chitna,Mendeltna,Nelchina,Eureka,Sheep Mountain and Glacier View,as well as the future prospects of Slana,Chistochina,HAARP,Cordova,McCarthy-Kennicott and all the other small communities within our service areas.Thousands of us are in need and can be the beneficiaries of this intertie. With your support,we can look:forward to the future with confidence that this part of the state will become as viable a community as the Mat-Su Valley,and Anchorage Bowl. Sincerely, L.Alan LeMaster,President Gakona Junction Village,Inc. cc:rf.W.Beck and Associates,Inc.-Mr.John Heberling,Executive Engineer _Alaska Energy Authority -Mr.Richard Emerman,Senior Economist Copper Valley Electric Association -Mr.Clayton Hurless,General Manager file RECEVWED MAR @ 1994 RIVISIONOFENERGY/UCRA Nick ZenbinosMarch7,1994 , PO BOX 371Referenceto; .Glennallen,ak .99588TranamissionCinefromTel907&22 345Sutton,to the copper River Basin.,eT Gentlemen: AS you ane aware,Many people are on the bandwagon,wheareabletofindmanyfaultswiththénOposnafect ko ,tnteaty between the es areas.tS mew proposal project fer ih what do T see én all of thés,nothing that ¢s not Hew,there hasbeenthesamepropagandaspreadaboutsemanyotherpaojectsénthisstate,WHY??for personal reasons,or something to dv,thattheydonotreallyundernstand??7 , How many people remember the huge static that was raised about theo¢?discoveryin this state,and its transmission Cines,also onthehugegasline,from the KENIA peninsula to the Anchorage belt,and into.the Matsu valley.Has all this hunt the state,in anu”way,Definetety not,but it was all a contribution towards theadvancementofthegrouth,and the prosperity that we do now:enjoy,yes there was some faults in thevprocess,but these exrorsanetobeexpected,and we must Look at'the overall picture,cand see the end results for the betterment of the people.andtheabilitytogoforwardintothe.future needs of this qreatState.Some sy that the proposal ofa dam ia the moat foaicalnproposalforenergyinthecopperariverbasin,including Valde>,and some say that the main reason for this,(8 due to one CittleaehineryinVALDEZ,how wrong they can be,that 45 only cone ofreasons,are they not Cooking at other avenues of qrouth thal willoccun??. : . T rzemember when the SOLOMON GULTCH profect was (nitéated,withthestudiesmadeatthatCime,were they corracet in thecsestimatesofthefuture?,(f seems that they were off hase ontheiacalculations,the dynamosy installed,and the amount «of water used to operate the generation system were obselite anaveryshorttime,and we had to continue to ase fhe déesel pawet ;aeneration system at aqreat cost,with@nt the rates fe dang Come red.4 with the construction af a dam,we wend be qaranteed enfiy onta 15 Sr@ MGW of power,with no addilfonal power CH re sctye,Again,we would have to depend on diesel generation for a,backup.Does that make sense??OE finately net,Who can say for sare whatwilltheamountofelextricitywillbeneededin1kyears?? withe the interaty system,we would have in our hands,a systemthatwouldprovideuswithasurplusofpower,that would be abletohandtealargergrouthinthisareaforaCongerperiodoftime.It does not make any sense,to turn aroundtvery ten or twe lveyears,and fight for funds to expand more energy into the same 'area,with that type of surveys,Leeds to foolish spending of fundsthatcouldbeusedforotherworthyprojects.-:batIwonder,how many pecple who do these studies,ever Look atwhatthecostoveraunsareonthesedamprojects?,Tf my memory (4Ati£LL functioning,The Solomon project,ended costing three timesasmuchasthe-cost estimate of those that did the survey.hewiththeconstauctionofthetranamcssionLine,then would bea t . i ost OVeRUNA.-fixed cost,with notany appreciable coat we would have a largertor,being that with the interty,)the ed tae nengy On hand that we would not have with the proposedtauction. .;;;dam oo beg of you to take these points in serious consideforyourfinaldecisononthisproject. hation Thank youPreAbines RECEIVED 5 March,1994 MAR 44 MP 109%Glenn Hwy.9 1994 HC 3 Box 8484C DIVISION OF ENERGY/popny F21mETs AK-99645 Dear Herv Hensley,We are writing in support of the Sutton to Glennallen Transmission Line Project and would like your support as well. We get our power from CVEA and pay the higest electric rates around (nearly .19¢KWH).We need this intertie to help stabilize our rates,to replace the dinasour generators that create our power,to help clean up our air and reduce the noise pollution (from the generators),as well as reduce the burning of fossilfuels. We realize the folks west of Caribou Creek (Chickaloon,Sutton, etc.),are not in support of this,but we feel that is because. they have their constant power and could care less about the customers of CVEA or the future of the Copper Valley Electrical-ASSn. We look for your support on this Electrical Intertie. 'ec ate a Mary P.Howarth-Hern Michael D.Hernandez mone eeemevei.veD MAR 11 1994COPPERVALLEYTéL@PHONeomCOOPERATIVEINCSIONOFENERGY/DCRA BOX 337,VALDEZ,ALASKA 99686 907-835-2231 FAX 907-835-2387 March 8,1994 Herv Hensley,Director DCRA,Division of Energy 333 W.4th Avenue Suite 220 Anchorage,Alaska 99501-2341 Dear Mr.Hensley: Copper Valley Telephone Cooperative,Inc.,is a non-profit,member owned cooperative providing communications services throughout a large portion of South-Central Alaska.In addition to our primary switching centers,the nature of this area requires us to provision many small, remote buildings in which we house electronic equipment requiring AC power to operate.We have a constant first question we ask when engineering and planning facilities--what is the availability and dependability of AC power and what is the present and future cost of that power? This dependence translates into charges for electrical services from 'Copper Valley Electric Cooperative in excess of $90,000 per year--and growing!!Since we operate on a non-profit basis,any increase inthosecostsultimatelyappearsonourcustomers'bills.We have morethanenoughexpensiveobstaclestoovercomeinordertoaccomplishour goals,and strongly support any project which can help us keep the lid on our operating expenses as we intend to remain in business here for many years to come. The Sutton-Glennallen Intertie Project has the potential to stabilize rates--a direct benefit for our customers,most of whom live and work in CVEA's service area.It has the potential to encourage economic development--a direct benefit for our customers.And it addresses future need for many years--again,a direct benefit for our customers. We can only see positive returns through this project,returns which directly affect the pocketbooks of our 4000 customers through our operations alone. As a utility,too often we find the expressed demands of a few override the unexpressed desire of the majority,especially where public works types of projects are concerned.I believe the benefits inherent in the Intertie far outweigh the alternatives,expecially from a long term perspective. Sincerely yours, Scott L.Smith General Manager 'MESEIVED | OO MAR 11 1994 _FACSIMILE TRANSMISSIQN'NOTE --=s-PUVISION OF Ener /ocra DATE:_NO:OFPAGES:I OURFAX#(907)835-5666 ATTN:Commissioner Blatchford FAX#(907)465-2948 RE:. Suiton/Glennallen Intertie No city is an island,entire of itself;every city if piece of the state,a partofthemain;if Valdez is without reasonable electricity,Alaska is the less... any city's stagnation diminishes us,because we are involved in the state's economy;and therefore if the Sutton/Glennallen tie-line shorts out,don'tsendtoknowforwhomthebelltolls;it tolls for Valdez and Alaska. -with apologies to John Donne,- John L.Cerutti oh |"7 akDavidK.Lee .|[0 'Bonnie J.Stripe oe we:Dorothy K.Schweigert 7 F7 I _EDGARAswleyZewonhensfbe,Will gt blackVAT,_L Ao >poy ur U/nAeEcCEeE VEDMarch2,1994 .Chey rae , MAR 14 1994 To The Editor,DIVISION OF ENERGY/DCRA Peter Goodman has written two articles on the Glennallen intertie.Both were negative.Both were so poorly organized thatIThadtroublereadingthem.Both demonstrated a profound ignorance of the physical realities of power generation.His editorial stance parading as hard news is clearly motivated byhispositionastheDailyNewsreporterfortheMatanuskaValley.The intertie isn't popular in the Valley. Anchorage bowl residents already have cheap power and,even though it would cost them nothing,many see no reason to offer the same benefits to others.I manage KCHU,Valdez a regional public radio station and electrical charges are a big problem for us.We can't afford what we pay now.How will we accommodate the large increases that are a certainty if the tie line is not built?Some local businesses already pay more for electricity than their mortgage.KCHU is one of them, The bottom line for Mr.Goodman is,of course,circulation;news for hire.News for money.News with the factual content selected to tell customers exactly what they want to hear.The Daily News used to be a paper that every Alaskan could be proud of.At this point,if there were an alternative,I would cancel my subscription.I am sick of the profit motive that has permeated every corner of the organization.The work of Goodman and others like him is offensive to any journalist with an ounce of integrity. James Winchester Box 1553 Valdez,Alaska 99686 907-835-4665 ..© ee RS>»@ &rad Fs")i,.OF Sali<=><==§=Q 7 Fron Hepresentnbive FROM:Mr.Rex F.Hollman PO Box 2114 Valdez AK 99686 835-4950 CONSTITUENT ) SUBJECT:ENERGY MESSAGE:PLEASE SUPPORT THE SUTTON TO GLENNALLEN INTERTIE. DISTRIBUTION 60 Albers, eee v cD ||FEB 2 8 1994COPPERVALLEYELECTRICASSOCIATION,INC.P.O.BOX45 GLENNALLEN,ALASKA ggsaq-AHSiON OF ENERGY/DCRA Glennallen (907)822-3211 Valdez (907)835-4301Telefax#(907)822-5586 February 23,1994 Robert E.Harris Division of Energy Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,Alaska 99501-2341 SUBJECT:Comments on Beck Study and Public Meetings Dear Robert: Enclosed are Copper Valley Electric's written comments which we would like incorporated into the public comment section of the final feasibility study. Two sets of comments are provided for your review. 1.Comments specifically addressing a comparison of the intertie and Allison Lake alternatives. 2.Comments on the draft study,as well as,comments in response to comments made at the last round of public meetings. If additional information is required as to disposition of these items,please call me. Sincerely, Clayton Hurless General Manager Enclosure c:\wpdocs\cdh\94-029.nh SERVING MEMBER-OWNERS IN THE COPPER RIVER BASIN AND VALDEZ COPPER VALLEY ELECTRIC ASSOCIATION,INC. P.O.BOX45 GLENNALLEN,ALASKA 99588-0045 Glennallen (907)822-3211 Valdez (907)835-4301 Telefax #(907)822-5586 -_February 18,1994 COMPARATIVE_INFORMATION SUTTON-GLENNALLEN INTERTIE TO ALLISON LAKE PROJECT COMMENTS BY:CeefenQNeWIRYESS,GEGENERAL MANAGERPREEACE: Certain interest groups who oppose the construction of the Sutton to Glennallen intertie line seem to have decided the Allison Lake Project should be the preferred alternative future power supply of Copper Valley Electric Association (CVEA).They have apparently based their opinion on the comparative Net Present Values that are presented in Table 1-2 on page 1-15 of the Executive Summary of the Sutton to Glennallen Intertie draft feasibility study recently released by the Division of Energy,Department of Community &Regional Affairs (DE-DCRA).Their rush to make a selection that would eliminate the need to build the intertie needs to be put in it's proper perspective for those who are interested in the factual aspects of the .debate over the need for and economic justification of constructing a 138KV transmission line to connect the CVEA system to the Railbelt Utilities System (RUS). CVEA's Board of Directors and Staff have been actively involved for a number of years in searching for an:alternative power supply to replace the aging and costly diesel generation presently being used to supplement the power available from the State owned Solomon Gulch Hydro (SGH)plant.In October of 19893 CVEA compiled and published a booklet titled "History and Status of Power Generation Resources",that reviews the different power supply options that have been studied in the past.The Allison Lake project was one of the projects studied and rejected because it did not meet a single criteria that had been established for a future power supply resource. if the reader chooses to reject the above fact,another significant consideration must be taken into account.A major unavoidable cost of the Allison Lake project has.been omitted from the feasibility economic analysis.The omitted costis attributable to the one- half of the energy production that is credited to the Allison Lake project that would be produced by the Solomon Gulch turbines and would bear a current cost of 6.4 cents kWh. Adding this charge to the annual operating cost of Allison Lake changes the cumulative Net Present Value of Allison Lake in the medium-low load case to$77,399,000,an increase of $11,000,000 from the draft feasibility study and $10,000,000 more than the SERVING MEMBER-OWNERS IN THE COPPER RIVER BASIN AND VALDEZ intertie lf both of the above arguments are rejected,and itis accepted the draft feasibility studyiscorrectbynotassigningacosttotheAllisonLakeProjectforpowerproducedatSolomonGuich,there is still not a compelling case to build Allison Lake in lieu of the intertie.In the high and medium high load cases,the intertie is clearly the least costalternative.In the medium low load case which seems to have captured the imagination of the interties opponents,Allison Lake is only marginally less expensive;$1.2 million over the 50 year period,than the intertie.For a utility such as CVEA to select the Allison Lake alternative instead of the intertie based on the small difference in the NPV over the 50 year period would be an inexcusable,short sighted mistake considering that Allison Lake would add only 3 MW of capacity,at a cost of $11 million per MW and approximately 27,000 MWH of energy to CVEA's power supply.To plan to the mostconservativeloadgrowthestimatewouldcompletelyabortCVEA's original goal of identifying and building a power supply resource that would provide the greatest degree of flexibility in meeting the uncertainty of the future without having to resort back to a short term emergency planning spectrum that inevitably leads to high cost solutions. CVEA'S FUTURE POWER SUPPLY SELECTION CRITERIA In mid 1992 CVEA developed a list of required characteristics for the assessment of future power supply alternatives.The following are the four most important criteria or characteristics that were developed to serve as a planning guideiin the effort to identitythebestfuturepowersupplyoption. 1.The project should be able to efficiently provide generation adequate to supplement the output of the SGH and totally displace the diese!generation.| 2.it should have the ability to serve the total system load in the event of an emergency shut down of the Solomon Gulch plant. 3.Priority would be given to a project that could serve CVEA's projected long term load growth and thereby alleviate the need for periodic construction of new generation. 4.Projects would be evaluated on their potential ability to provide for rate reduction and/or stabilization for CVEA's member owners. SUTTON-GLENNALLEN _INTERTIE VS ALLISON LAKE PROJECT The following information is presented on a point by point basis to provide the reader with a discusssion of the characteristics of both proposed projects and should dispel the notion that Allison Lake is really a viable project to achieve the goals CVEA has established for the selection of a future power supply option. 1.PROJECTS ABILITY TO PROVIDE ADEQUATE GENERATION TO DISPLACE DIESELS R.W.Beck has estimated that in the medium-low load case,CVEA's total supplemental energy requirements will approximate 37,000 MWH in 1998 and will increase to 59,000 MWAH in 2017.This does not consider any substantial load growth of the Petro Star Refinery load or any of the more speculative projects such as the U.S.GovernmentsHighActiveAuroralResearchProject(HAARP). As stated above Allison Lake is estimated to produce approximately 27,000 MWH of energy annually and would add a total of 3 MW of capacity to CVEA's generation capability.The existing diesel plants would have to be maintained to supplement output of Solomon Gulch and Allison Lake beginning in the first year of operation. The Intertie could deliver 15-18 MW of capacity and approximately 100,000 MWH of energy at 65%Load Factor (LF)without the addition of any voltage support equipment(Static Var System,SVS).With the addition of an adequate sized SVS the intertie would deliver 40 MW of capacity and approximately 225,000 MWH of energy:annually.The | intertie would provide for retirement of the diesels into an emergency standby status. 2.PROVIDE ABILITY TO SERVE ENTIRE SYSTEM_IN THE EVENT OF AN EMERGENCY SOLOMON GULCH SHUTDOWN. Allison Lake would not be operableif the Solomon Gulch project was forced into anemergencyshutdownbecauseboththeprimaryandsecondarygenerationfromAllison Lake would be dependent on the Solomon Gulch electrical facilities being operable. The Intertie is totallyindependent of Solomon Guich with the exception of minimal voltage support which could be supplied by CVEA's 2.8 MW turbine that is immediately available in the event of an emergency.In the medium low load case the intertie could serve CVEA's total system requirement through 2017 without additional SVS.In the medium high load case it could serve the total system requirements,with the addtion of the 2.8 MW turbine,through the same period without SVS support.If loads should grow in accordance with the high load case the addition of SVS would be required but that eventuality would not effect the economic viability of the intertie because of the added revenue that would be available from the additional sales and a load of the magnitude that required the addition of a SVS would likely be required to make a substantial contribution to the cost of SVS prior to becoming connected to CVEA's system. 3.CAPABILITY TO SERVE LONG TERM LOAD GROWTH WITHOUT PERIODIC CONSTRUCTION OF NEW GENERATION In the medium low load case the draft study estimates that CVEA will require 39,100 MWAH of supplemental energy in the year 2000 when Allison Lake would come on line. In the medium high load case the requirement increases to 47,600 MWH.Allison Lake would have a total combined generating capability of 27,000 MWH which would mean a shortfall of 12,100 MWH in the medium low load case and a 20,600 MWH in the medium high load case in it's first year of operation. In contrast to Allison Lake,the Intertie could be brought on linein 1998 and would serveCVEA's expected supplemental requirements,in all load growth cases,well beyond the §0 year study period. The bottom line to this point is clear.The Intertie is an essentially permanent fix to CVEA's future power supply requirements.Allison Lake is not even a bandaid because it would require a disproportionately high investment in a project that would not meet CVEA's supplemental requirements in it's first year of operation and would seriouly impune CVEA's ability to finance another major project. 4 PROJECTS ABILITY TO REDUCE OR ATA MINIMUM STABLIZE CVEA'S RETAIL RATES. Allison Lake would cause CVEA's already extremely high rates to increase.It does not provide for the diesels to be retired into emergency standby status.If the aging diese! plants are required to be maintained into the future,it is a given the cost will increase substantially.Allison Lake would not provide for a second power source for the Copper Basin District in the event of a failure of the existing Valdez to Glennallen transmission line which would require the Glennalien diesel plant to be maintained in hot standbyduringtheavalancheperiodwhenthetransmissionlineinvulnerabletofailure. Based on early discussions with potential power suppliers in the Railbelt,CVEA believes it will be able to reduce rates to its cansumers with the advent of the intertie.The magnitude of the decrease is still somewhat nebulous and will remain so until a final power supply agreement is reached.It is not unreasonable to estimate that a meaningfull reduction can be achieved. in addition to the expected favorable impact on rates,the intertie will provide a completely independent power source for CVEA's system.In the event of an emergency shutdown of the Solomon Gulch Hydro the intertie could provide for the total system requirements for a number of years into the future.In the event of transmission fine failure between Valdez and Glennallen,it would provide a power source for the Copper Basin District. Solomon Gulch would provide for the Valdez Districts requirement initially and in the event of an extended outage could be supplemented with the Valdez diesel plant to keep the entire system operational until the line could be repaired. -SUMMARY Based on any rational planning basis,there is no reason the Allison Lake project would be constructed instead of the Intertie.It would be absurd to entertain the idea of investing $30 plus million in a 3 MW project that wouldn't meet the utilities supplemental requirements in it's first year of operation as compared to investing $46 million in a 40 MW project that would provide for CVEA's supplemental or full system requirements into the forseeable future. Allison Lake would not fullfill a single criteria established by CVEA for consideration of a future power supply option.._ The Intertie Project would fullfill every criteria and surpass some of the criteria.The evidence is verifiable and conclusive.There is no reason for an extended debate of the relative merits of the two projects because even a casual analysis will clearly identify the Intertie as the right decision for Copper Valley Electric Association's member owners. COPPER VALLEY ELECTRIC ASSOCIATION COMMENTS ON RW BECK AND DIVISION OF ENERGY FEASIBILITY STUDY OF COPPER VALLEY INTERTIE FEBRUARY 23,1994 COPPER VALLEY ELECTRIC ASSOCIATION COMMENTS ON RW BECK DRAFT | COPPER VALLEY INTERTIE FEBRUARY 23,1994 SECTION I-INTRODUCTION - 1.The last sentence on page II-1 is misleading.This Sentence implies that Petro Star caused the need for the T-line and accelerated CVEA planningefforts.Thisis inconsistent with what CVEA has been doing.CVEA has been actively engagediin theplanningprocessformanyyearsonmanydifferentprojects. SECTION IV-FEASIBILITY DESIGN-TRANSMISSION LINE 1. 1. The first sentence in the third paragraph of IV.A.3 mentions a backfeed situation to Suttonin a negative'connotation. Additional system evaluation will show that it is possible to provide a reliable back up to Sutton.It may require a reactor or splitting the required line reactance between PS11 and Sutton.Significant public comment was received as to the lack of benefits to MEA consumers.The ability to backfeed to O'Neill substation would be a benefit to MEA. Section IV.D.3 on conductor selection should summarize how the chosen conductor was selected. There are advantages to using other conductors that have not been adequately identified.As an example,T2 conductor could be used to eliminate vibration and galloping mitigation costs associated with higher tensions and longer spans. SECTION V-FEASIBILITY DESIGN-SUBSTATIONS The O'Neil]substation as described in Section V.B could be modified to reduce price with no sacrifice 'in reliability. The proposed circuit breaker could be replaced with a series 2000 circuit switcher.Ii has ample interrupting rating and has been used successfully in the MEA system.As it is essentially a live tank breaker,the required CT's could be located in the transformer bushings.Open Station service transformers are not needed.The SCADA RTU costs are very excessive based upon MEA and CVEA experience.The use of reactors at both the Sutton and PSI11 stations may allow backfeeding ofpower to the Sutton area. The PS11 substation as describedin section V.C could be modified to reduce price with no sacrificeinreliability. Open beam A-frame structures could be used and are less expensive than tubular designs.The SCADA RTU costs are very excessive based upon CVEA and MEA experience.The use of reactors at both the Sutton and PSII stations may allow backfeeding of power to the Sutton area. 'Comments on RW Beck Draft February 23,1994 Page 2 ON _VII-ELECTRIC LOAD FORECASTSECTI 1.Assumptions for employment in Valdez and the Copper River Basin are not consistent with historical trends., The 1992-1993 projections ofthe compound annual growth rate for Valdez population in the High,Mid, and Low cases are 2.53%,1.47%,and -.096%respectively.The 1980-1992 actual rate was 2.9%,and the rate for the period 1989-1992 was 10.1%.Projected values do not trend with historical.Much of the Valdez population is driven by the Alyeska terminal.We have discussed terminal population with Bill Newbold,Alyeska Terminal Manager,and he states that employment at the terminal is not tied to oil flow but is task driven.He expects that ongoing maintenance activities will continue to stabilize or even expand Valdez employment.Valdez employment should also be supported by the Hard Piping Vapor Extraction System scheduled for installation within the next three to five years at the terminal. Continued growth offish processing industries will continue to support and expand Valdez employment. The 1992-2013 projections of the compound annual growth rate for the Copper River Basin population in the High,Mid and Low cases are 1.2%,.90%,and .54%respectively.The 1980-1992 actual rate is .3%,and the rate for the period 1989-1992 is 2.5%.Continued economic development of the Copper River Basin is due to the efforts of the Greater Copper Valley Chamber of Commerce and the Copper Valley Economic Development Council.Tourism will continue to expand with the new $17 million Wrangell St.Elias National Park visitor's center to be constructed by the National Park Service in Copper Center. The recent announcement of the Record of Decision for the HAARP project has not been included in the study. CVEA just recently received notice from the HAARP project requesting CVEA service to the HAARP facility.CVEA is currently studying the ability to serve the power required for testing over the T-line and is presently negotiating with HAARP to provide three-phase 24.9 kv service for "shutdown"and "standby"power.Shutdown energy needs are expected to be 400 kw for 7,260 hours per year,and standby needs are expected to be 1255 kw for 800 hours per year.These values should be incorporated into the load projections for the Low,Mid,and High cases. Costs for new diesel generation in Table IX-6 may be understated. Based upon CVEA experience with proposals from Caterpillar and Wartsilla,costs for new generation should be at least $1,000 per kw.We are unable to determine where building costs are added to the Beck model.Battery costs are too low.Switch gear costs are too low.There are no allowances for generation step-up transformers.Delivery costs are too low.Where are costs for additional fuel storage,switching improvements,and modifications to existing facilities? Discussion on permitting process for the coal plant may be misleading. Stating the permitting process for the coal plant could be simplified may be in error.The State of Alaska is currently promulgating new air quality regulations which will complicate the permitting process. Comments on RW Beck Draft -February 23,1994 Page 3 SECTION X-ECONOMIC ANALYSIS 1.50-Year Zero-Interest Loan The resource model outputs and,accordingly,the present value of the intertie alternative presented in the study do not reflect the 50-year,zero-interest,.$35,000,000 loan provided for by the Alaska legislature.We believe that the economic analysis,specifically Table X-3,should include an additional intertie case which reflects the loan.Additionally,a resource model output should be included in Volume I,Appendix J.. Allison Lake Cost of Power The economic analysis ignores costs similar to all scenarios such a fixed costs on existing diesels and Solomon Gulch purchased power expense. _The Allison Lake economic analysis also ignores the fact that approximately 4 of the energy produced by Allison Lake will be generated via existing Solomon Gulch turbines.CVEA is under long-term contract with the Four Dam Pool and State of Alaska to purchase all available energy which SolomonGulchcanproduce.The current rate for power produced at Solomon Gulch is 6.4¢per kwh.Any reduction in the cost of Solomon Gulch produced power would require unanimous approval of all six Four Dam Pool members.Given CVEA has been a net beneficiary of the Four Dam Pool arrangement since its inception,it is highly unlikely other members would pass on an opportunity to mitigate that fact.: The State has taken the position that Allison Lake energy produced via Solonion turbines results in no cost to the State and,accordingly,has a zero economic impact.This argument is basic form over substance rhetoric.The impact to CVEA's consumers who will pay the going rate for Solomon produced Allison Lake energy is $872,000 per year.Clearly the result of this omission causes a material distortion of the results presented in Table X-3 of the study. 'A resource model output which correctly reflects contracted for purchases of Allison Lake energy out ofSolomon Gulch turbines should be included in Appendix J of Volume I of the study.'Table X-3 should be revised as well.© Present Value Impact of Zero-Interest Loan and Allison Lake Power Cost RW Beck has prepared resource model outputs for the two aforementioned omissions from the study. The results of these runs are summarized on the attached Schedule 1.Several resource model outputs prepared by RW Beck are attached as supporting schedules to Schedule 1. -.Comments on RW Beck Draft February 23,1994 Page 4 Table X-5 Estimated Cost of Power This table is misrepresentative and misleading. a.This table assumes the zero-interest state loan is available to Allison Lake,Silver Lake,and the Coal Project.It is our understanding that this financing is available only to the intertie option and to present information such as is presented in Table X-5 is an obvious distortion ofthe facts. b.The cost of power analysis which underlies Table X-5 appears to ignore inflation (nominal $) when calculating the capital cost offuture diesel expansion. Cc.Table X-5 should be corrected to eliminate the zero-interest loan for all alternatives but the intertie,should eliminate the scenario of not paying for Allison Lake energy produced by Solomon,and any impact from comment 4.b above should be corrected in the diesel numbers. Inflation Free Analysis The inflation free analysis creates an economic disadvantage when comparing the intertie to other alternatives.This disadvantage is because future capital costs such as for incremental diesel units are not inflated to correspond with increases in general inflation.Accordingly,projects such as the intertie, whose capital costs are front-end loaded,suffer when compared to projects with capital costs that are spread out in the future., Page X-16-Supplemental Financing The interest rate usedfor supplementalfinancing of 8.5%is unrealisticfor alternatives which CVEA may choose to pursue.CVEA could likely obtain projectfinancing for the intertie on diesels in the 6.5-7.5% interest rate range,either from the Rural Electrification Administration or the Cooperative Finance Corporation. Project costs for Allison do not include any mitigation costs for impacts to fish and wildlife. There could be significant effects on the Valdez Fisheries salmon rearing program by changing the water quality in the Solomon reservoir.Allison Lake has much more silt than does Solomon. The Allison study mentioned that the lake may need to be dredged;however,the estimated costs do not include any dredging. Diesel fuel efficiencies need to be reduced due to the loss of efficiency because of the timing adjustments required to control emissions. Comments on RW Beck Draft February 23,1994 Page 5 1. RESPONSE TO COMMENTS OFFERED AT PUBLIC MEETINGS Static Var Compensator The installation of the static var compensator should not be included in the study.Opponents of the intertie have taken the approach that this is needed.Their basis is a desire to increase the project costs and present value to reduce the economics associated with the T-line.It is perfectly clear that proponents of the intertie have not read the complete analysis performed by PTI. This analysis states that the steady state transfer level of the intertie is 24 mw under "system intact" conditions.The intertie transfer limits are only reduced during problems on the Railbelt electrical system.During these contingencies,the line transfer limits are approximately 14 mw.The outage conditions which cause this situation are ofshort duration andfrequency.One of the outage conditions occur when a 115 kv breaker at Teeland opens.This occurs possibly once per year for a duration of four to six hours.This is a 99%availability.The other outage condition occurs when the Point Mackenzie to Teeland 230 kv line is out of service.This occurs once every three years with a duration offour to six hours. CVEA will be maintaining diesel generation as a backup for these and other contingencies,and the installation of an SVS to avoid transfer limitations is not needed.In the event a large load were to connect to the CVEA system,additional compensation systems may be needed;however,the significant increase in load would more than offset the costs of additional compensation. Including an expensive SVS system to remedy Railbelt system weaknesses is not justifiable.This is especially true since the contingencies pose no significant impacts to CVEA. Right-of-Way Acquisition Costs Considerable public comment was received that right-of-way acquisition costs included in the study are understated.Care should be taken by Beck to ensure costs of obtaining rights-of-way are reasonably provided forin the study. Petro Star Load a.Many participants in the public meetings have formed the opinion that Petro Star loads in the medium-low and medium-high loadforecast scenarios are inflated and unrealistic.In May 1992, -Petro Star contracted with CVEA to provide all of their electric requirements for a period offive years.The contract provides for afive mw connected load with an initial estimated running load of 2,500 kw.Facilities at Petro Star are presently adequate to service a five mw load. Since refinery start-up in January 1993,Petro Star has steadily increased electrical usage and is currently approdching demand of two mw.Over the next few months,Petro Star is expected to achieve their initial estimated running load of 2,500 kw. .Comments on RW Beck Draft February 23,1994 Page 6 We understand the Division of Energy has recently contracted with an oil industry professional to assess and lend credence to Beck's assumptions reflected in the draft study.We believe the Petro Star loads as reflected in the study are reasonable and defensible,and that they will be upheld by third party review. b.Several persons testified that the only reason this project was being built was to provide cheaper -electric power to Petro Star.These kind of statements are politically motivated and serve only to demonstrate the ignorance of the persons making them.-CVEA has been searching for power supply resources since the 1970's.In addition to these projects addressed by the study,CVEA has,over the last seven years,pursued interconnection to Alyeska Terminal,developed a least cost plan,considered raising the height ofthe Solomon Gulch dam and spillway,studied merging with Golden Valley Electric Association,discussed mutual cooperation with Chugach and MEA, and has evaluated separating the Copper Basin and Valdez districts into two utilities.All of the aforementioned studies have had a dual aim:1)reduce or stabilize rates,and 2)obtain needed generation resources. The Beck study projects the energy requirement of CVEA over and above the hydro to be nearly 27,000 mwh in 1994.That energy is currently provided by old,inefficient diesel generation, which even with proper maintenance will not run forever.Clearly the intertie project is not about Petro Star,it is about obtaining a reliable power supply for CVEA's other 2,906 consumers.Yes,Petro Star enhances the economics of the project,but if you are at all optimistic about the future of this part of Alaska,this project is needed with or without Petro Star. 4.CVEA is assumed to have influenced the study. Several statements were made which accused CVEA of influencing the study to the point of impairing Beck's independence.While such comments are inflammatory and popular with the detractors of the project,they are utter nonsense. CVEA contracted with the Alaska Energy Authority (now the Division of Energy)to conduct this Jeasibility study in accordance with Alaska requirements for such studies.The project has been under the control ofRichard Emerman,Senior Economist at AEA.Mr.Emerman has controlled how the study was conducted and what information would be included in and excluded from the study.All communications between CVEA and RW Beck which resulted in suggested or promised revisions to the document by Beck were subject to Mr.Emerman's acceptance and approval. CVEA did meet and exchange information with Beck throughout the preparation of the document.While critics view this as undue influence,CVEA views it as a necessary element of the process to ensure the preparation of an accurate and meaningful document.After all,the Sutton to Glennallen intertie is about CVEA,CVEA'S service territory,and CVEA's electric system. Comments on RW Beck Draft February 23,1994 Page 7 3.Conservation Comments were made about whether conservation options should be included in combination with other power supply alternatives.The comment has some merit,but after inclusion of conservation with all other options,the impacts to the economic analysis would likely be immaterial. 6.CVEA has not researched alternatives. As discussed previously under the Petro Star comment,CVEA has devoted considerable effort into researching power supply alternatives dating back to the 1970's. SUMMARY OF ECONOMIC ANALYSIS-CUMULATIVE PRESENT VALUE OF COMPARABLE SYSTEM COSTS($000) All Diesel Intertie Allison Lake Silver Lake Coal Facility Conserv- ation High Case Scenario Per Draft Study Accounting for 0 interest on $35 million loan $125,711 $77,250 $125,903 $116,763 $129,399 N/A Medium High Case Scenario Per Draft Stud $88,450AccountingforOinterest$96,616 $61,665 $98,264 $101,361 |$95,847 on $35 million loan Medium Low Case Scenario Per Draft Study $70,055 Accounting for O interest $75,584 |$50,029 $77,399 $70,055 $84,176 |$75,006 on $35 million loan Low Case Scenario Per Draft Study $37,566 |$47 _$4 ,394 $60,619 N/A Accounting for 0 interest on $35 million loan $37,566 $30,375 $52,597 $60,619 $59,783 N/A Schedule 1 VENTSOTOt FRL ioete AW DEVA-OCANLILG vulovet CMA MMe CVU Sth fut reve RW.BECK AND ASSOCIATES 2101 Fourth Avenue,Suite 600 m Seactle,Washington 98121-2375 @ USA Telephone (2043)441-7500 m Fax (206)441-4952 "WS-1559-HAI-AJ January 28,1994 Mr.Clayton Hurless General Manager Copper Valley Electric Association,Inc. P.O.Box 45 tennallen,Alaska 99538-0045 Additional Economic Analusis Runs Dear Clayton: As you requested,I ran two different scenarios of the economic analysis.The first scenario added a 6.4 cent/KWh charge to the 13,621 MWh expected to be generated at the Solomon Gulch rowerhouse as a result of construction of the Allison Lake project.This totals $872,000 per year in 1993 dollars and is shown on the attached tables as in increase in the O&M Line for the Allison Lake Project.The second additional scenario effectively modeled the apptcalicn of the $05 million State Lean to the costs af the Intertie.In order to remainconsistentwiththeanalyticalmodelingproceduresinchidedinourmodel;this was accomplished by reducing the capital cost of the Intertie to $10,931,000 and adding a $700,000 per year loan payment in each year of the analysis.Both scenarios were run for the medium- high and medium-low load growth cazes. I also checked the calculation precedure used in the model and found that the vemainine 30 year period costs are actually held constant and the present value is calculated --using this constant payment.If you can't replicate the numbers on the printouts let me know © because the dala you need should be available to you with the information in the report.We used an inflation free discount rate of 5%in the analysis.I ran through this analysis rather Guickly this afternoon so please look it over and make sure it conforms with your thoughts onthematter.As slways,call me at (206)727-4419 (or 206-881-6198 over the weekend)if you have any questions Very truly yours, R.W.BECK AND ASSOCIATES Ce L.HeberlingecutiveEngineer -JLH: c Post-It”brand fax tranamittal mamo 7671 [sof pages > "CLAYTeN)fuses |"J.HEBERLING ©|oleh MO RWeectPhone# "07 -$22.-SS8G Fars TT-a Allison Lake w /Sol Gulch Cost High Load;Med Fuel Ex Diesel Retire OF) Diese!Costs Fuel. Variable O&M Existing Diesel O&M Adjustment |Additional Building and Equipment New Diesel Fixed O&M New Dicsel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying ChargeAnnualO&M Costs Economy EncrpyTotalInterticCosts Allison Lake Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cast of Power Sale of Surplus Solomon Gulch EnergySurplusEnergy Revenves from Sale District Heat Net Revenue(Coal Case) Net Annual Cost af Pawer 31-Jan-94 Aluska Enenzy Authority Copper Valley lotertic Peasibility Study DRAFT Economic:Analysis Constant 1993 Dotlars -Ail Costs in Thousands of Dollars) 3k HG NNZ IMR e 20a 2003204 S97)$1577 $2,934 $2,118 $2,203 $2,370 $2683)$1510 $1820 82,129 $2,436 =$2,742776876140459m805556668295386472Hg610 .f°0 -0 tH 0 a 0 0 0 0 Q Q.. 0 0 -O 0 0 0 1)0 0 0 ft 0 o ,4 tt)26 26 26 26 26 26 26 2h 26 0 0 0 141 283 566 56h $66 564 5b6 546 566 $2,346 =$2454 62979 48,196 =$3,317 $3,517 $OY43 $2,396 =$2,799 $3,192 $3,576)$3,943 $0 $0 $0 50 0 #0 $0 $0 $0 $0 #)$0 nt $0 $a 50 0 m0 $0 $0 $0 $0 )$0 0 0 0 0 0 0 v0 i 0 0 0 a 0 0)0 0 a 0 4 0 Q Q 0 6 30 40 $0 $0 $0 $0)a $0 $0 bt)$0)$0 $0 $0 $0 #0 nt)$0 $0 $1,766 =$1,766 =$1,766 $1766 $1,7660Qv00Q01,156 1,156 1156 ____1.56 1,156$0 $0 $0 $0 ry $0 $0 $2,922 =$2,922 $2,922 $2,922 $2,922 $2,146 «42,154 392,979 =$3,196 |$3,317 $3,517 $3,943 $5,318 $5,721 $6,114 $6498 $6,865 0 '0 0 o-0 0 0 i)q 0 0 $0 $0 0 $0 $0 $0 $0 40 $0 RU $0 $0 BSD $0 $0 $0 $0 $0 $0 30 $0 =$0 $0 $0 $2,146 $2,454 $2,979 $3,195 $3,317 $3,517 $3,943 $5318 $5721 $6,114 $6498 $6865 Present Value in 1993 dollars (Discounted @5%) Cumulative (1993 -2017)$81,190 Cin thousands) 30 Year (2018 -20:17)with no ack litional growth 44,7139 (in thousands) Total Net Present Value $125,903 Gin Chousands) R.W.Beck and Assuciates Result:Page5 «4 I¢*NYNALPRATS-NHSrmnananWiiwaAesIAaAqKW'ANYHAbaRblhbaN?Pn'A ' - 1) é Allison Lake w /Seul Guich Cost High toad;Med Fuel Ex Diesel Retive OH Dicsel Costs Piel Variable O&M Gaistings Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservatian Cost Intertie Cost Annual Carrying Charge Annual O&M Casts Economy Enorgy Total [ntertie Costs Allison Lake Annual Canying Charze Annual O&M Costs Tatal Other Costs Total Cost of Power Sale of Surplus Solomon Guich Energy Sarplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Anmual Cost of Power 31-Jan-94 Alaska Energy Authority Copper Valley Intertie Feasibility Study DRAFY. Ecunomic Analysis (Constant 1993 Dollars -Al Custs in Thousands of Doltirs) 2005 «ath 2tZ 2008 2M 0T-«s:s«s2 (asa A StH| $3,191 $3,733 SAB71 $4,015 $3,941 $3,787 $3,957 $4195 $4327 BEOI7§$4725 $4,941 95,171 OS GP C8 69R 673 «6368-«<aS CTC 2K9si7HBSC*«WZ 0 0 0 O 0 0 0 0 0 0 r(]0 0 0 ao 0 G 0 0 0 0 1 0 qa .oO -OQ5277717GF777277777777 707 849 BAYA Baa$4555 $5,331 $5,482 $5,640 $540 $5,349 95,516 46,732 $5,936 $6,159 $6A00 46,050 90,928 $0 $0 $0 #0 $0 Sth 40 $0 §0 40 $0 $0 $0 $0 $0 $0 $0 $0 $0 40 60 $0 40 $0 $0 40 0 qa a 0 0 0)1)qa 0 0 0 0 0 0 0 0 0 Q 0 {)0 a 7}(i 0 0Sth$0 50 $0 jo 40 $0 $0 @ $0 $0 $0 $1,766 $1,766 $1,766 $1766 $1,766 $1,766 $1766 $1,766 $1,766 $1765 $1,766 $1,766 $1,766115613561561,156 1,156 4,156 44356 9561S ISH ON T56 1.156 1.156$2,922 $2,922 $2,922 62,922 $2,922 $2,922 $2,922 $2922 $2,922 $2,922 $2,922 $2,922 $2,022 $7A77 $8252 $8,404 $8,562 $HAG2 $8,271 $8A5S $RESA $8,858 $9080 $9322 99571 $9850 rt 0 a 0 0 0 oO ff 0 a 0 0 o $0 $0 $0 $0 $0 $0 $0 $0 «$0 $0 $0 50 $0 60 $0 $0 $0 $0 $080 $0 $0 $0 $0 $0 $0 S7A77 $8,252 $841 $8562 $RAGZ $8,271 GBASK $8454 $8858 $9,080 $9,322 $9,571 99,850 R.W.Beck and Associates Result-Page 6 fef]1bR-1f-NHEOuaeRESEATNATINSNOSTTLIBAS/SAARAHFORPlbhGZ'ONXU4£0'A vla Allison Lake w/Sul Gulch Cost Low Lwad;Med Fue} Ex Diesd Retire OH Dicse!Costs Fuel Variahle O&M |Existing ics O&M Adjustment Additional Building and Equipment New Diesel Fixat O&M New Diesel Capital Costs Total Diesel Casts Tulal Conservation Cost Intertic Cost Annual Carrying Charge Annual O&M Costs Kounniny Energy Total Intertie Costs Allison Lake Anuual Carrying ChargeAnnualO&M Casts Total Other Casts Total Cost of Power Sale of Surplus Solomon Gulch EnergySurplusEnergy, Revenues from Sale District Heat Net Revenue(Coal Case) Net Animal Cost of Power 31-Jan-94 Alaska Energy Authority --Copper Valicy intertie Feasibility Study DRAFT Economic Analysis (Constant 1993 Dollars --All Casts in Thousands of Dollars) 1993 14-=1905 13%5297 1998 1999 2000 2001 22 2002 2004 $134 $1,445 $1,709)=$1,747 $1,424 $1,412 =$1,690 $132 Fi3¢$131 $124 tus 746 807 915 gw 683 661 6fd)a 25 24 22 21 i)0 0 0 0 0 Qa (146)(146)(146)146}(146) 0 fi]i)0 0 0 i a 0 0 0 0 oO,1)0 0 26 20 26 2h +26 26 26 26 (}0 i)0 yt -vet 14?td)141 141_._saa 141 $2,161 42,252 $2,643 $2685 $2,470 9 $2,441 $2,467 4479 $181 $176 $169 $160 $0 $0 $0 $tt $0 $0 bt $0 $l $0 $0 h*8) 60 wh $0)£0 $0 $0 Ae]$0 nO £0 $1)90 0 ")0 0 0 0 0 0 0 )6 0 (¢]0 0 0 0 0 ft 0 0 0 Q 0 40 70 a $0 $0 $0 4)$f $0 $0 ®)$0 40 $0 $0 a $0 $0 $1,766 $1,766 $1,766 $765 $1.76 0 i)(t 0 0 it)0 1,156 1,156 1,156 1156 1,156 Ww $0 $0 Su $0 $0 $0 $2,922 $2,922 $2,922 $2,922 $2,922 $2061 $2252 $2643 $2685 $2479 $2Ad1 $2467 $3,101 $3,102 $3,098 «$3090 $3,082 0 0 0 0 0 0 t)0 0 i]0 o $0 $0 $0)$0 Ke)40 $0 $0 $0 $0 $0 $0 $0 gu $0 0)$0 Sih $0 £0 $0 $0 $0 $0 $2,D61 $2,252 $2,643 $2,685 $2A7v $2,441 $2A67 $3,101 $3,102 $3,098 43,090 $3,082 Present Value in 1993 dollars (Discounted @5%;) Cumulative (1993 -2017)$34,235 (in thousands) 30 Year (2018 -2017)with no additional growth 13,362 {ia thousands) Total Net Present Value $52,597 Cin thousands), R.W.Buck and Assodates |Result:Page 5 TINSHNASTIIHAC/IAAAMNRENTNAWpA-Th--NurPORIbbANZ'NNYHArota” cla Alison Lake w/Sol Gulch Cost Low (oad;Med Fuel Ex Diesel Retire OH Niesel Costs Fuel Variable OS.M Existing Dieset O&M Adjustment Additioni Building and Equipment New Diesel Fixed OXM New Diesel Capital Costs Total Divsel Costs Total Conservation Cost Intertie Cost _Annual Carrying Charge Annnal O&M Casts Economy Energy Total Intertic Costs Allison Lake Annual Cawying Chane Annual O&M Casts Total Other Costs Total Cost of Power Sale of Surplus Solomon Guich Energy -Surplus Bnergy Revenues fromm Sale Distrkt Heat Net Revenue(Coal Case) Net Annual Cost of Power 31-Jan-94 Alaska inergy Authority --Copper Vallcy Intertie Feasibility Staly DRAFT Economic Analysis (Constant 1993 Dollars All Costs in Thontsands of Dolkirs) 2005 2h HRN 202 2y12 20182 AIS NH 2017 $110 $103 $95 $87 $79 $63 ASU Bey 40 bei $0 $0 $0 9 (8 46 (4 "13 Ww a 0 O 0 )v0 0 146)(146)et)(HY 146)(B45)(146)(146)(146)(46)(146)(146)(148) 0 0 0 0 0 0 a 0 0 )0 0 0 2 =,26 26 26 26 26 26 26 2 ©=-oh 2A %2641idl141wal11411M1141141141141poh Sit $2139 $123 HN $95 $22 §22 $22 $22 $22 $22 $22 $0 $0 wi Be so =$0 CU BU $0 $0 *)Hr £0 $0 BA $0 w $0 «$0 0 $a $0 40 $0 $0 $0 i]0 0 0 0 '@ 0 a a 4]Y a 0 0 0 0 u (eee ()0 0 Q 0 0 i) $0 $0 $0 $0 $0 $0 $0 {0 $0 #0 $0 $0 au ,, $1,766 °$1,706 $1,766 $1766 $17 $1,766 $1,766 $1,766 $1,766 $1766 $1,766 $1,766 $1,766 VAR6_956 LG 156 0,956 1,156 56 156 7,156 1156 56 5G 156 $2,922 $2,922 $2,922 $2922 $2,922 $2,922 $2922 $2,992 $2,922 $2922 $2,922 $2,922 $2,922 $3,073 $3064 $3054 $3045 $3,036 $3,017 $2,944 $2944 {2,944 $2944 $2,942 $2,944 $2,944 0 1)0 0 iY oO 0 0 0 a )0 H) $0 $0 40 $0 $0.$0 $0 $0 $0 $0 30 $)$o $0 $0 $0 $0 =$0 $0 $0 »)$0 $0 BH)$0 $a $3,073 $3,064 $3,054 $345 $3936 $3,017 $2,944 $2944 $2,944 $2,944 $2,944 RW.Beck and Assoctates $2,044 $2,944 Result:Page fi BeitHOWpR-if-NerPO8bIk?S02'ONXVALINSNOSTLLLBAS/V9IGNa$0'd oTIntertle -Netof State laan Fizh Land Med Buel Ex Diese)Retire OF Diesct Costs Fuel Varlable Oke Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Casts Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Anrniual O&M Costs Economy Fuergy Total Intentic Costs Other Annual Carrying Charge Annual O&M Costs 'Votal Other Costs Total Cost of Power _Sale of Surplus Solomon Guich Energy Surplus Energy Revenues from Sale District Heat Net Revenuc(Coat Case) Net Annual Cnst of Power 31-Jan-94 Alasha Energy Authority -Copper Valley Intertie Feasibility Study DRAFT Eounesni:Analysis (Constant 1993 Dollars -All Custs in Thousands of Dollars) 1993 1994 4995 1996 1997 1998 1939 2000 2001 ame 2003 2004 $1,370 $1,577 $1,934 $2,239)$2,585 $0 $0 $0 a $0 $0 $0 176 6 Las L145 1250 4]0 0 0 0 0 o i '0 0 0 (560)(560)(560)(560)560)(560)(560) 0 0 0 0 q 0 0 0 f 3a 33 33 0 ;4)0 0 0 0 0 0 v 24 26 26 4]0 0 1)ff]0 0 0 0 141 141 141 $2,460 $2454 $2,979 $3,388 43,835 ($560)«=560)(3560)HHO)HIG)(F300)(8960) $0 $0 Bet $0 $0 $0 40 sn $0 $0 $0 $0 _-oe - $1,299 =$1,299 $1,209)$1,299 $1,299 $1,299 $1,299 _-------207 207 207 207 22 207 207 (i)0 1 a QO 1.295 1A56 1,623 L798 LY71 2,147 2,931 $0 fo $0 $0 $0 $2,800 =$2,961 $3,129 $3,303 $3,551 $3,653 $3,836 o $9 ©.go w OM fo go $$go WW go 0 ?a (1)i]0 0 0 0 Q f 0 )$0 $0 $0 $0 $0 $0 $0 ¢0 $0 $0 $0 $2,146 882454 =$2,979 $3,384 $3,835 «$2,240 $2A01 =$2,569 =$2,743 $3,191 =$3,292 33,476 o 0 0 Q 0 0 0 0 0 0 (]0 $0 $0 $0 $0 $0 $0 $0 $0 '$0 |$0 $0 $0 $0 0 $0 $0 $0 $0 $0 60 $0 $0 $0 ;$0 $2,146 $2,454 $2,979 $3,384 $3835 $2,240 92,401 $2,569 $2,743 §3,191 $3,292 $3,476 Present Value in 1993 dallars (Niscounted @5%) Cumulative (1993 -2017)$51,001 fin Uhousands) 3)Year (2078 -2047)with no additional growth 26,249 (in thousands) Total Net Present Value $77,250 (in thousands) R.W.Bock and Associates Result:Puge 5 paneTobane'ANXe4Nb:flNALbA-1F-NEPTINGNADATLIBAS/IAAAANan'd LT-{F Intertic -Net of State Loon High Load;Med Fuel Ex Dicse]Relire OH Diesel Costs Fuel VariableO&M Existing Diescal O&34 Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diese!Capital Custa Total Diese?Costs , Total Conservation Cost Tatertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Other Annual Carrying Charge Annual O&dMi Costs Yotal Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Imergy Revenues fromn Sale District Heat Net Revenue(Coal Case) Net Annna!Cost of Power 31-Jan-94 Alasky Energy Authority Capper Valley Intertic Feasibility Study DRAY? Economic Anulysis (Constant 1993 Dollars All Casts in Thousands of Dollars) 2005 2006 AZ 2K MN 2 20 a?BNA 27 $0 $0 $0 $0)$o $0 $0 40 $a $0 $0 $0 $0 0 0 0 'ny 0 0 0 0 0 0 0 0 (560)G60)(560)(560)(S60)(S60)(560)uN)|)HO)AN)(560)(5600) 33 33 33 33 33 33 33 33 33 33 33 33 33 52 52 52 52 52 52 52 52 52 77.«77 17 7? 263 28323 283 BF RS OBS RS Kad 4240 ad 424 ($193)($193)($193)(G193)($193)C13)193)$193)F193)4H)($26)($28)(426) wo 86§0 0 gO Hg $1,299 $1,299 $1,299 $1,299 $1,299 $1,299 $1,299 $1,299 $1,299 $1,299 $1,299 $1,209 $1,299 207-0 207,BA 221 «22122 A 2 i 2 a HY 2902___3,25t 3351 __345t_3416 3,334 3A5t 3572-3698 827 3,960 R240$4,407 $4,760 $4,931 $4,971 $4,936 $4,854 $4,97L $5,217 $5,237 $5306 45,499 $5,437 $5,808 $0 a)fo gg WwW $0 $0 $0 (0 )0 ft)0 0 0 0 Q i qd.0 $0 ca $0 $0 $0 $0 $0 9?$0 $0 $0 $0)$0 $4,214 $4567 $4,738 $4,778 $4,743 $4,661 $4,778 $5,024 $6144 $5340 $5,474 $5,611 $5,782 0 0 0 0 0 0 0 0 1)a 0 0 0 $0 $0 $0 $0 $0 $0 $0 gu 1)$0 BY)$0 $0 $0 $0 §0 $0 $0 $0 $0 $0 $0 $0 Ft)$0 $0 $4214 $4,567 $4,738 $4,778 $4743 $4,661 $4,778 $5024 $5,084 $5340 $5474 $5,611 $5,782 R.W.Beck and Associates ry Result:Pape 6 oerIre900'ONXVILINSNOOSWLLV3S/4030He0:01NOW¥O-le-N¥fLO'd CHUGACH ELECTRIC ASSOCIATION,INC. DAVID L.HIGHERS General Manager February25,1994 |"GE, p.Yu FEB 25 1904histoyMr.Robert Harris OFENERGyDongStateofAlaska, : Division of Energy Department of Community &Regional Affairs 333 West Fourth Avenue Anchorage,Alaska 99501-2311 Subject:CVEA Intertie Feasibility Study Dear Mr.Harris: Attached is a copy of a letter I recently sent to Mr.Clayton Hurless regardingthe draft CVEA Intertie Feasibility Study.The letter reports on our review of the draft and includes materials my staff has prepared on railbelt interconnection feasibility considerations. I request that the attached be considered the formal comments of Chugach on the draft Feasibility Study and that our comments be incorporated in the final report. David L.Highers General Manager Attachment cc:Mr.Clayton Hurless w/o Attachment Mr.Herv Hensley w/Attachment 4460.TAL:TS 5601 Minnesota Drive «P.O.Box 196300 «Anchorage,Alaska 99519-6300 Phone 907-563-7494 ¢FAX 907-562-0027 bcc:Gene Bjornstad Dan Bloomer Dave Burlingame John Cooley Mike Cunningham Don Edwards Rick Freymiller Joe Griffith Carol Johnson File,CRF,RF CHUGACH ELECTRIC ASSOCIATION,INC.. DAVID L.HIGHERS General Manager February 24,1994 Mr.Clayton Hurless Copper Valley Electric Association,Inc. P.O.Box 45 Glennallen,Alaska 99588-0045 Subject:CVEA Intertie Feasibility Study Dear Clayton: Previous analysis by Chugach indicated that construction of the intertie along with a power sales arrangement between Chugach and CVEA was economically beneficial to the consumers of both utilities.As a result,I have had my staff review the Draft Report of the Feasibility Study-CVEA Intertie dated January 1994 by R.W.Beck.As you know,the study was not done with the aim of answering the question of what is the best alternative for the CVEA consumers but was instead aimed at the welfare of the State as a whole. The R.W.Beck study itself does not reach any conclusion but merely reports the economic outcome for several different views of the future.Contrary to the conclusions that may be implied from press reports,the study supports a conclusion that construction of the intertie is the best solution forCVEA. Table I-5 Summary ofEconomic Analysis Results on page I-15 of the report shows the cumulative present value of comparable system costs for seven different scenarios.The key difference among the scenarios is the assumptions about load growth.As is typical with load forecasts,there are estimates of high,medium and low load growth.The R.W.Beck load forecast is lower,even,than CVEA's original forecast. The future will probably not match any of the scenarios listed so one must look at the expected results under different scenarios.The attached graph shows the cumulative net present value for three alternatives for the seven scenarios listed in the R.W.Beck report.The intertie is the least cost option for five of the scenarios while the all-diesel scenario is the least cost option for only low load growth and Allison Lake is the least cost option only for medium-low load growth.The intertie alternative is clearly the most robust solution since it is the least cost option for more scenarios. 56041 Minnesota Drive «PO,Box 196300 »Anchorage,Alaska 99519-6300 Phone 907-563-7494 «FAX 907-562-0027 Clayton Hurless February 24,1994 CVEA Intertie Feasibility Study Page 2 Assigning a 60%probability to the medium or base forecast,10%to the high forecast,and 30%to the low forecast,the intertie alternative is clearly the least cost option as shown in the following table. Expected Cumulative Net Present Value (typical probabilities) AllDiesel =Intertie Allison LakeHighLoadGrowth10.0%$125,711 $94,660 $114,700 Medium-High Load Growth 30.0%: High Fuel Price 6.0%$104,599 $83,543 $91,954 Medium Fuel Price 18.0%$96,616 $79,086 -$87,059 Low Fuel Price 6.0%$81,539 $70,616 $77,801 Medium-Low Load Growth 30.0%$75,584 $67,440 $66,194 w Loa wt 30.0%$37,566.$47,785 $41,394 Expected Value 100.0%$75,075 $67,519 $69,602 Even changing the probabilities to reflect the pessimism of low load growth,the intertie is still an equivalent option on an expected value basis as shown in the following table.Chugach would note that this is a very extreme approach.One has to assign more than 50%probability to the low growth forecast before the intertie ceases to be the least cost alternative. Expected Cumulative Net Present Value (pessimistic.probabilities) High Load Growth 10.0%$125,711 $94,660 $114,700 Medium-High Load Growth 20.0% High Fuel Price 4.0%$104,599 $83,543 $91,954 Medium Fuel Price 12.0%$96,616 $79,086 $87,059 Low Fuel Price 4.0%$81,539 $70,616 $77,801 Medium-Low Load Growth 20.0%$75,584 $67,440 $66,194 Low Load Growth 30.0%$37,566.$47,785.$41,394 Expected Value 100.0%$65,510 $62,503 $62,643 Even without modification the economic analysis in the R.W.Beck study shows that the intertieoptionhastheleastexpectedcosttotheStateandthereforeisafeasibleproject.Adding economic benefits not considered in the R.W.Beck study such as sales revenues to the railbelt and reduced Clayton Hurless February 24,1994 CVEA Intertie Feasibility Study . ,Page 3 finance costs (no interest loan)to CVEA consumers makes even more economic sense for the intertie alternative.. Also attached is a copy of CVEA and Railbelt Interconnection Feasibility Considerations paper that my staff had prepared and was previously forwarded to you by Mr.Lovas. Please let me know ifI can be of further assistance. Sincerely, David L.Highers General Manager 4457.JSC:TS Expected Cumulative Net Present Value (thousands of dollars) |---a-AllDiesel mJ intertie --¢--Allison Lake $140,000 |$120,000 $oe a $100,000 |.--Bgmee,ee"rere a$80,000 .-ae ee le_---" $60,000 4 am $40,000 + $20,000 + $0 sont t t t 4 High Med-Hi Med-Hi Med-Hi Med-:Low Load Load:Load::Load:Low Load Growth High Medium Low -Load Growth Fuel Fuel .+Fuel Growth EXP_VAL.XLS Chart 1 2/24/94 09:39 COPPER VALLEY ELECTRIC ASSOCIATION,INC. AND RAILBELT INTERCONNECTION FEASIBILITY CONSIDERATIONS The feasibility analysis of interconnecting the Copper Valley area including Valdez with the Railbelt should be viewed as the integration of two systems and not just a power supplyoptionforCopperValley.Two systems are usually integrated because there are economic benefits for each system.i.e.it is more economical to operate as a whole than as two parts.The exact form of the resulting whole (two utilities joined by a transmission line,a powerpool.or a merged entity)is not of primary importance.although different organizational forms can capture varying levels of benefits. The feasibility should be viewed more on the order of the analysis done to support the construction of the Alaska Intertie berween Anchorage and Fairbanks.In that case,the relative ratio of installed capacity was on the order of two to one (with significant savings in power costs following interconnection).In the case of connecting Copper Valley with the Railbelt.the relative magnitude is on the order of ten to one.The benefits should be the same.although not of the same magnitude.The two major categories of benefits are Economy Interchange Benefits and Reserve Sharing Benefits. Economic Interchange Benefits: As was the case with the Alaska Intertie.the generation cost differences between Copper Valley and the Railbelt are significant.A sharing of the generation savings from exchange is common.Copper Valley consumers would see lower power costs due both to lower operating costs of existing Railbelt generation as compared to diesel generation and the ability to tap the unused capacity in the Railbelt as compared to constructing additional generation.The combined system can accommodate larger generating units therefore achieving economies of scale that would not be available to Copper Valley.Railbelt consumers would also see lower power costs because the fixed costs of installed generation would be spread over a larger consumer base.The economic benefits of power sales from the Railbelt to Copper Valley may be quantified for both groups of consumers. Hydro-thermal coordination is another component of economic interchange benefits. Currently,Copper Valley is not able to fully utilize the output of Solomon Gulch and the Railbelt is not able to fully utilize the waste heat capability of its combined cycle units.The interconnection would allow full utilization of Solomon Gulch and improved utilization of the combined cycle units in the Railbelt. 4362.5SC:TS 12/15/93 CVEA and Railbelt Interconnection Feasibility Considerations Page 2 Reserve and Capacitv Sharing Benefits: Again as was the case with the Alaska Intertie.each area has sufficient reserves for the present, but interconnection will allow an overall reduction in the reserves.Copper Valley should also see an improvement in reliability as transmission lines are more reliable than generators.(The probability of an outage in an area is less with several generating units operating at other end of a transmission line than a single generator operating in the area.)Certain areas,such as Glennallen and Sutton.will have two sources of power rather than being fed via radial transmission lines and will experience enhanced reliability. In addition to pure reserve sharing,the interconnection would increase the siting options for new generation resources required by the interconnected systems.New hydro resources which may be attractive for future development are Allison Lake.Silver Lake,Tsina River,Tiekel River,or even pipeline oil flow down Thompson Pass into the Alyeska Marine Terminal.Short-term capacity deferrals may be available from interconnected operation of the two systems.Also. existing Alyeska Marine Terminal generation capacity may become available for utility use to allow deferral of new or replacement generation capacity.Fuel sources .as well are a consideration in the generation siting equation.This interconnection may open up new sources of fuel to the Railbelt such as the Trans-Alaska oil pipeline,the proposed gas pipeline,or from future development of the Copper River gas field. Economic Development Benefits: The introduction of adequate,economical electrical power in the Copper Valley area should stimulate development and improve the economy of the State.Increasing the consumer base upon which the costs of the line are spread will improve the benefit to cost ratio.Overall it will improve the utilization of electrical facilities throughout the Railbelt.With the interconnection, certain power users in the Copper Valley area may purchase their electrical needs rather than self generate.Examples could be the Alyeska Marine Terminal and pipeline pump stations.AdditionofthesecustomerstotheRailbeltsystemwillservetoreducetheelectricalpowercoststo everyone. 3362JSC:TS 12/15/93 /-|==Phone:on 822-3664 goLAhe . Ye January 28,1994 State of Alaska RECEIVED Department of Community and Regional Affairs Division of Energy FEB333WestFourthAvenue,Suite 220 09 1994 Anchorage,AK 99501-2341 DIVISIGN oF ENERGY/DCRA Attention:Mr.Robert E.Harris,Director . Re:Comment:Copper Valley Electric Intertie Feasibility Study -Draft Report. Dear Mr.Harris: Thank you for copying me on the above draft report.After reviewing the information |was encouragedbytheobviousfactthatweinthelocalREAarefollowingthecorrectpathtothesolutionofourproblem. !will only comment on a couple of points in the report. Route: For several weeks we have been reading in the Anchorage Daily News about the concerns of the people along the Glenn Highway regarding the location of the line.They are concerned about the "magnetic fields”,visual obstructions,crossing of private and native land holdings,and environmental disruptions during the construction and operationof the fine. |now appears that ail of these concerns have been taken into account in Scenario D.As noted on Maps 1 through 8 the line leaves the Sutton Substation and immediately movesnorth21/2 to as much as 5+miles away from the highway and the populated areas.With little exception the line will be out of the line of sight and certainly far enough away from the populous to not be intrusive.Additionally,this route takes the line off all private lands and with very little exception no incursion on native lands is evident.Of course the environmental impact during construction will be a factor but in the final analysis,with proper controls by the EPA,DEC,BLM,DNR and other agencies,can easily be held to a minimum. After all factors are considered |fully support the construction along the proposed Route D as recommended in the draft report. Economic Analysis: With a close scrutiny of the information in this section it becomes clear that the Intertie is the most cost effective system we can develop.Additionally,it will provide us with all our foreseeable needs from now into the future.Any other system will require upgrading from time to time or will,at best,only supply a portion of our needs now and into the near term. !am encouraged by the systematic and through work done by the folks at R.W.Beck and applaud their efforts.|encourage you to make your final decision at the earliest possible moment so we can begin to that will lead to a more cost effective and stable source of energy in the years to come. fileOn:= P.O.Box 222 Gakona,Alaska 99586 _-._-_ KCHU Terminal Radio,Inc. PO.Box 467 ©Valdez,Alaska 99686 ©(907)835-4665 «FAX 835-9847 \-|Director,Division of Energy RECE:VED Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220.FEB 14 1994Anchorage,Alaska 99501-2341 DIVISION OF ENERGY/DCRA February 8,1994 To Whom It May Concern, KCHU is the public radio station for Prince William Sound and the Copper River Valley.Electrical costs are a major portionof ourannualbudget.We spend more than almost every other radio station in the state.Power costs are a crippling burden for most businesses in this region. I had an opportunity to review the recently published legislative.study of the Glennallen intertie project and wasshockedatthenegativerecommendations.There are several large computational errors in the work.But quite aside from those,I am offended that this extremely flawed review has been passed off as fact. Electrical interconnection with the rail belt is of primary importance to the economic well being of this region.The intertie needs to be built now.No more expensive and specious studies.No more excuses.Build it.We need it.I will assure you that if construction is impeded or halted because of this $400,000 fiction,those responsible will have some answering to do in Valdez and the Copper Basin. Singferely, James Winchester Géneral Manager 770-AM 88.1-FM 88.3-FM 88.1-FM VALDEZ CORDOVA WHITTIER . CHENEGA FEB.16,1994 -mECE VED RICH EMERMAN FEB 18 1994 DIV..OF ENERGY ;DuDEPTOFCOMMUNITYAFFAIRSSION OF ENERGY/poRA3EEW.4TH SUITE 200 ANCHORAGE,AK 99501 DEAR MR EMERMANS ; I WISH THIS LETTER TO BE ENTERED INTO THE RECORD FOR PUBLIC TESTIMONY ON THE SUTTON TO GLENNALLEN INTERTIE. I ATTENDED THE MEETING HELD AT THE CARIBOU CAFE FER.9TH. I AM CHOOSING THIS METHOD OF TESTIMONY AS INVITED.DUE TO THE LARGE CONTINGENT OF CHICKALOON-SUTTON RESIDENTS AT THAT MEETING,I FELT THIS FORUM WOULD MORE LIKELY TO BE HEARD OVER THE CLAMOR THAN SFOKEN (OR SHOUTED)TESTIMONY AT THE MEETING. FIRST:It AM THE OWNER OF A SMALL BUSINESS IN KENNY LAKE. WE HAVE A GENERAL STORE,GAS,FEED AND A SMALL LAUNDRYMAT. MY ELECTRIC BILL FOR LAST MONTH WAS OVER #1200.00.IT WILL BE HIGHER NOW,AS THE FIRST BILLS FOR THE LAUNDRY HAVE NOT YET COME IN. SECOND:I HAVE CONSERVEDAS MUCH AS I CAN AND STAY IN BUSINESS.I SHUT DOWN ALL NON-ESSENTIAL ELECTRIC ITEMS . MY OUTDOOR LIGHTING IS MINIMAL BORDERING ON UNSAFE IN THE WINTER. ON MY WAY TO THE INTERTIE MEETING I DID SOME SHOFFING IN GLENNALLEN.I COULDN'T FIND THE DRIVEWAYS IN GLENNALLEN LEADING TO BUSINESSES,NO OUTDOOR LIGHTING,THEY CAN''T AFFORD IT.THE ONLY WAY YOU ENOW WHERE A BUSINESS MIGHT BE TS A DIM SIGN IN THE WINDOWS.GLENNALLEN IS 4 COLD,GRIM DARK TOWN IN THE WINTER.DEPRESSING AND UNSAFE TO DRIVERS OR WALKERS.NO ONE CAN AFFORD WHAT THEY FAY FOR ELECTRICITYNOW,MUCH LESS OUTDOOR LIGHTS. THIRD.NO MATTER WHAT PROJECT IS PROPOSED SOMEONE WILL OBJECT LOUDLY.INTERTIE:IT'S NOT PRETTY.SUTTON RESIDENTS DON'T NEED IT.THEY HAVE CHEAP RATES AND ARE UNWILLING TO SHARE THEIR GOOD FORTUNE.MOST UNNEIGHBORLY. HYDRO:THE ENVIRONMENTALIST ARE NOT GOING TO LIKE HEARING THE CONSTRUCTION METHODS TO BRING WATER FROM ALLISON TO SOLOMON GULCH.COAL OR DIESEL:NOBODY LIKES THAT ONE. AIR QUALITY,FOSSIL FUELS,ALL CONTROVERSTAL SUBJECTS. CONSERVATION:I THINK THAT'S ADDRESSED IN THE OFEN STATEMENT HERE.NOT A CURRENT PROFOSAL BUT THE KLUTINA HYDRO DIVERSION THING:WAIT TILL THE SFORTFISHERMAN, SUBSISTENCE USERS,TOUR BOAT OPERATORS AND THE STATE HEAR ABOUT THAT ONE,THERE ARE KING AND RED SALMON SPAWNING THROUGH THERE. NOT HAVING A CRYSTAL BALL,I CANNOT TELL WHICH OF THE LOAD SCENARIOS ARE LIFELY TO HAPFEN,."BUT MY BEST GUESS HUNCH IS THAT THE INTERTIE IS MOST LIKELY TO FILL OUR NEEDS.I AM IN FAVOR OF THE INTERTIE FOR THE FOLLOWING REASONS;WE NEED TO STABILIZE OUR RATES OR THIS AREA WILL NOT GROW AND BE SELF SUPPORTING AS THE STATE WOULD LIKE ALL UNORGANIZED AREAS TO BE,AND THAT WE WANT TO BE.IT IS AS ENVIRONMENTALLY RESPONSIBLE AS ANY OF THE OPTIONS.IT RELIES ON GOOD QUALITY AND QUANTITY FUEL SOURCES.IT TIES US ECONOMICALLY POLITICALLY AND SOCIALLY INTO THE LARGE RAILBELT AREA, UNITING INSTEAD OF DIVIDING.WE MUST DO SOMETHING,CVEA'S AGING GENERATORS MUST BE REPLACED OR ANOTHER SOURCE FOUND. ELECTRIC RATES IN THE YEAR 2010 ARE FROJECTED AT .25 CENTS PER KWH. SINCERELY SUSAN WININGHAM HC 60 BOX 230 COFFER CENTER,AK 995373 HARBORMASTER ID:907-835-4479 FEB 25794 14:34 No.003 P.O1 2/25/94 Nees .F StepMr.Herv Hensley ER 25DepartmentofCommunityandRegionalAffairsOs,1994 Divison of Energy 0,OF gyPOBox190899epAnchorage,Alaska 99519 RA Dear Mr.Hensley: I am writing in support of the CVEA intertie project,I believa this project has the best chance of success to help lower the power yates for the CVEA power area. T have seen articles in various publications that the intertie system is just to benefit the Petro-Star refinery is ludicrous,theplanningfortheintertiehasbeenontheagendaforCVEAlongbeforethePetro-Star was even discussed. I am involved in the commerical and sport fish business and we have always felt that a cold storage facility would allow secondaryprocessingofseafood,but unfortunely the high cost of power hasalwaysbeenthedemiseofthattypeofproject. I would also like to comment about the complaints voiced by tharesidentsofChickaloon,my step-grandfather/grandmother lived in that area for many years.They owned the King Mountain gas stationfrom1962to1976andtheystillhavefamilyinthatarea. My grandfather/grandmother who are pasted away were always a firmsupporterofdevelopmentforourState,being a business man he knew that progress needed to be made to allow a future for hischildren/grandchildern. Grandfather lived in the Chickloon area after he sold the station until his death and he would be upset if he knew that his neighors were making a big deal out of running a few power lines thru basically no where. He was firm believer in working for a living and he considered most of his neighors in the Chickloon area to be welfare cases and deadbeats. I hope that the concerns of the Chickaloon people are addressed buttheyshouldn't be able to hold up a project that will benefit theentireStateofAlaska. Thank you. Tim Lopez Valdez. FEB-25 -'94 FRI 15:30 ID:TEL NO:#871 POL aa E u =ew c D FEB 25 1994 DIVISION OF ENERGY/DCRA February 25,1994 Mr.Herv HensleyDepartmentofCommunity and Regional Affairs Division of Energy P.O.Box 190869 Anchorage,Alaska 99519 Sent by FAX to :269-4520 i Dear Mr.Hensley: I am writing in regards to the Copper Valley Electric Associations proposed intertie from Mat-Su valley to Glennallen. The citizens in Glennallen and Yaldez pay one of the highest electrical rates in the State of Alaska.Not only does this placa a burden on the residents but it stifles economical development in these communities. There have been many different proposals to attempt to stabilize orlowerelectricrates,however the|R.W.Beck study clearly pointsoutthattheintertieoptionissuperiortootheroptions. Your assistance in making the intertie a reality will be greatlyappreciatedbythecitizensintheabovementionedcommunitiesand the citizens living along the upper Glen and lower Richardsonhighways. Sincerely:Ae h : Thomas W,McAlister P.O.Box 814 Valdez,Alaska 99686 -"™ FEB 23 1994 DIVISION OF ENERGY /UCRA \- iy14)1ch wyreei.WwWWDf=475a==3bpt=9Azf={=f=odibisoo{=fa '3 5tJ42F445iy0925 'yp' ; 331Did28nro)a] t- YDIJssiyawD =iJs1wywei. Thadpermarin) 'DP Geo c 19LA>=fsIfr=js9igcSaa45.Pe£xc FROM :EAGLE'S REST INC.PHONE NO.:90?835 5267 EAGLE'S REST =>R.V.PARK 1-800-553-7275 (PARK) (907)835-2373 *FAX (907)835-5267P.O.Box 610 +Valdez,Alaska 99686 February 25,1994 Mr.Edger Blatchford,Commissioner Department of Community and Regional Affairs P.O.Box 112100 Juneau,Alaska 99811 . Dear Mr.Blatchford, Nothing like waiting until the last minute,but this letter is to let you know of vur support for the Sutton -Glennallen Intertie!We feel it is very important for further development not only in the Valdez area but the others also.Thank-you for taking the time tu let us express our thoughts. Sincerely, Powe.date Laura L.Saxe Eagle's Rest RV Park Secretary-Treasurer "ove wED OFFICE OF THE CITY MANAGER February 10,1994 FEB 14 1994 ++swewsa UF ENERGY /DCRA Mr.Dick Emerman Department of Community and Regional AffairsDivisionofEnergy P.O.Box 190869 Anchorage,Alaska 99519 Dear Mr.Emerman: The City has reviewed the draft report of the Copper ValleyIntertieFeasibilityStudy.The City of Valdez supports alleffortstofindthecheapestandbestsourceofelectricalenergyforCopperValleyElectricAssociation(CVEA).The.FeasibilityStudyshowsthattheintertiewillprovidethecheapestpowerwiththeleastenvironmentalimpact.The Study has done a good job ofaddressingandmitigatingallthecreditableobjectionstotheintertie. The City has a few technical comments on the study.The AllisonLakeproject,Silver Lake Project,and the Conservation ProjectwillleaveCVEAwithoutalongtermsolution.These projects willrequiresupplementaldieselatcompletionorsoonaftertheycomeonline.This will leave CVEA without a good long term solution to satisfy future demands or address its problems with aging diesel generators. The fact that Allison Lake,Silver Lake,the Coal Facility,and Conservation all assume additional diesel plant to be up and running needs to be stated in the Executive Summary cf the report.This fact can be ascertainedby studying the charts in appendix J,but it is not stated in a readily available portion of the study. The portion of the study dealing with the concerns over the Electric and Magnetic Field is very good.Keeping the intertie 600 feet from all occupied structures is a very conservative method of reducing or eliminating risks in an area where the risk is unknown and uncertain.This is far more than has ever been done to address this concern in the past. The alignment of the intertie has done an excellent job ofaddressingconcernsovertheunsightlinessoftheline.Thepreferredalternativeissetbackfarenoughfromthehighwaysoit should not be objectionable. P.O.BOX 307 »VALDEZ,ALASKA 99686 TELEPHONE (907)835-4313 ©TELEX 25-381 «TELECOPIER (907)835-2992 Letter to Mr.Dick Emerman Page 2 February 10,1994 The table as shown on X-17 should be expanded to include both the high case and low case.With these improvements,the table should be included in the Executive Summary.I believe this presentation of the data is comprehendible by most people. The Alaska Legislature has said the loan for the intertie cannot be used for any other project.The study shows the Intertie is the most cost effective method of supplying power to CVEA.The City ofValdezsupportsconstructionoftheintertie. If you have any further questions (or comments,please do nothesitatetocontactme. Sincerely, CITY OF VALDEZ City Manager BW/mam cc:Mayor John HarrisValdezCityCouncil Members Dave Dengel,Assistant City Manager (Community Development Director)Bill Wilcox,City Engineer Emerman.127 FEB 2§1994 DIVISIONOFENERGY/DCRA OFFICE OF THE CITY MANAGER February 25,1994 Mr.Herv Hensley Department of Community and Regional AffairsDivisionofEnergy P.O.Box 190869 eer a Hite,99519 Sent by FAX to :269-4520 Dear Mr.(Hensley: I am writing to supplement earlier comments I have forwarded to Mr.Dick Emerman by letter dated February 10,1994. The City of Valdez remains fully committed to the best alternativetostabilizeandhopefullylowerelectricalratesforourresidents,businesses,and government agencies.Using the mostYeasonableassumptionsforfuturegrowthintheR.W.Beck studytheintertieoptionisclearlysuperiortootheroptions. I believe the focus on the intertie only serving possible expansionofthePetroStarValdezRefineryisoverblown,in large part to reports in the Anchorage Daily News.PetroStar may benefit from lower rates but so would the average homeowner,small business.owner,and the City of Valdez which spends about $1 millionannuallyonelectricitytopumpwater,light buildings and streets,and compact solid waste.The thought that the intertie is only forPetroStarisridiculous. I am even more concerned about future economic development opportunities that will never materialize because our electricityratesmakeusuncompetitivewithotherlocations.The Alaska Pork'Project presently being studied by Globe Meats of Denmark inconjunctionwiththeAlaskaDivisionofEconomicDevelopment(Chris -Gates,Director)has the potential of creating 500 jobs andbringinganewyear round industry to Alaska.Valdez is proposinganoptiontolocatetheentireoperationintheValdez-Copper RiverBasinandourbiggestproblemisourcostofpower.OtheropportunitiestodiversifyandexpandoureconomicbaseinthispartofAlaskawillbelostunlesswedosomethingaboutthehigh. cost of power.: P.O.BOX 307 »VALDEZ,ALASKA 89686 TELEPHONE (907)836-4313 »TELEX 25.381 «TELECOPIER (807)636-2992 33Mr.Herv HensleyDepartmentofCommunity and Regional AffairsFebruary25,1994 Page 2 I will be happy to answer any further questions you may haveregardingtheCityofValdezposition.Thank you for thisopportunitytocomment. Sincerely, Doug Griffin City Manager cc:Mayor John HarrisValdezCityCouncilmembersCommissionerEdgarBlatchford,Dept.of CommunityandRegionalAffairs VALDEZ FISHERIES .DEVELOPMENT ASSOCIATION INC. P.O.Box 125Valdez,Alaska 99686 Lines,Phone 835-4874 Fax 835-4e31"ECE YEH FEB 25 1994 DMIsion of ENERGY /DoRA NOESaHPeony| >Hl February 18,1994 Mr.Dick Emerman State of Alaska Dept.of Community &Regional Affairs 333 W.4th Ave.Suite 220 Anchorage,Ak 99501-2341 Dear Mr.Emerman: Valdez Fisheries Development Association Inc.(Solomon GulchHatchery)is located in Valdez,Alaska.We are a private non-profit aquaculture association located across Dayville Road from the Solomon Gulch Hydroelectric plant. Valdez Fisheries wishes to express our concerns about the proposedAllisonLaketunnelprojectasanalternativetotheGlennallen Intertie project.The following list expresses these concerns: 1.The major water supply to the Solomon Gulch Hatchery comes fromthetailraceofthehydroelectricplant.With the exception ofapproximatelytwomonth(August and September)the water comingfromSolomonLakeisclean.It meets the requirements for theincubationandrearingofbotheggsandfry.It is very important to the survival of these eggs-and fry that the water be clean and free of as much silt as possible.By allowing Allison Lake water to flow into Solomon Lake,the water in Solomon Lake will be ina 'constant turmoil and the silt will not be allowed to settle out. Therefore,severe incubation and rearing conditions will occur year round.This condition will place our eggs and fry in jeopardy and lessen their chances for survival.This in turn will create a severe economical problem for Valdez Fisheries. 2.The water in Solomon Lake has been determined to be void cf any fish species or aquatic organisms which may carry a disease that could be devastating to Solomon Gulch Hatchery.The waters of Allison Lake have not been tested for the existence of any disease carrying fish or organisms. 3.Allison Lake is fed by many snowfields and several glaciers which dump a tremendous amount of silt into the lake.It has been observed on numerous occasions by hikers,pilots and employees of Alyeska that Allison Lake is a very heavily silted lake.By feeding Allison Lake water into Solomon Lake,the silt load would be greatly increased.Individually,Solomon Lake is adequate forthepropagationofPacificsalmon,however,with the addition of Allison Lake water it now becomes marginal at best. 4.The silt in Solomon and Allison Lakes is a jer flour thatDEDICATEDTOTHEUTILIZATION,ConSeRvat10 ,AND REHABILITATION OF ALASKA'S FISHERY RESOURCE WITHIN THE 200-MILE LIMIT is less than five microns in size.The small size of the silt makes it very difficult and expensive to filter out.By allowingthesilttosettletothebottom,the water supply to the turbines and Solomon Gulch hatchery is relatively clean. 5.It would seem to me that any increase in the silt level of the water fed to the turbines of the hydroelectric facility would also greatly increase the ware and tare on the turbine blades which would decrease the longevity of the turbines. Valdez Fisheries Development Association opposes the use of Allison Lake water to supplement Solomon Lake water.Please feel free to contact VFDA at (907)835-4874 if you have any questions and thankyouforallowingustocomment. Respectfully, Mau ebb Dave Cobb Business Manager COPPER VALLEY ELECTRIC ASSOCIATION,INC. P.O.BOX45 GLENNALLEN,ALASKA 99588-0045 Glennallen (907)822-3211 Valdez (907)835-4301 Telefax #(907)822-5586 March 22,1994 Mr.Herv Hensley,Director Division of Energy Department of Community and Regional Affairs 333 W.4th Ave.,Suite 220 Anchorage,Alaska 99501-2341 SUBJECT:Copper Valley Electric Association Comments on RW Beck Draft Feasibility Study as to:Estimated Cost of Power Load Forecast Assumptions Dear Herv: The purpose of this letter is to provide specific comment relative to Table X-5 (Estimated Cost of Power)and general comments on load forecast assumptions included in the RW Beck Draft Feasibility Study dated January 1994.Given we understand the comment period has unofficially remained open for an additional 30 days,we would request this document be included,in its entirety,in the final version of the report. Table X-5 Estimated Cost of Power It is our opinion that the cost of power,as presented by Beck in Table X-5 of the report,does not accurately present the true or expected cost of the power supply alternatives.The attached document presents scenarios under both the medium high and medium low load forecasts for four power supply alternatives.Those alternatives include: Diesel Expansion Case Allison Lake Intertie--Non-Firm Power and Not Integrated into the Railbelt Intertie--Firm Power and Integrated into the RailbeltPWNe SERVING MEMBER-OWNERS IN THE COPPER RIVER BASIN AND VALDEZ Comments on RW Beck Study March 22,1994 Page 2 The objective of this analysis is to calculate the estimated cost of power which will ultimately be paid by the consumers rather than calculating a cost from the perspective of the State for purposes of comparing study alternatives.Accordingly,certain costs omitted from Beck's analysis,such as labor and Solomon Gulch cost of Allison power,have been added to scenarios where appropriate.In addition to the aforementioned omissions,several of Beck's basic assumptions have been adjusted based on our utility experience and expectations of future requirements of the various scenarios.These assumptions are stated on attached exhibits to the report.Finally,the costs,where appropriate,have been inflated using an average rate of inflation of 2.75%. The following table compares the CVEA analysis to Table X-5 from the Beck study. .2 CENTS PER KWH:caoBECK|cvEA||BECK |CVEAf-yEAR|2000-|2000 2010 |2010 Diesel 12.6 14.2 18.5 14.5 Allison Lake 18.8 :20.6 19.9 17.2 Intertie (nonfirm)10.2 ) Intertie (firm)10.2 7.3 Diesel 12.9 ;16.1 19.6 17.4 Allison Lake 20.6 :24.0 19.6 :21.6 Intertie (nonfirm)11.6 9.8 _____Intertie (firm)11.2 |77 13.316.7 | As you can readily see,the cost of power as calculated by Beck and CVEA differ dramatically. In our opinion,our analysis provides a much truer estimated cost of power which will ultimatelybepaidforbyourmembers.We request that Beck examine our assumptions and make appropriate modifications to Table X-5 to reflect,as accurately as possible,power cost based on sound assumptions.We also request this entire document,less the cover letter,be included in the public comments section of the final study. Comments on RW Beck Study March 22,1994 Page 3 Load Forecast _General Comment 'Much has been said about the inflated load forecast upon which the feasibility study is based. It is our opinion that the medium high load forecast is the most realistic of the four scenarios presented for a number of reasons: 1.It tracks closely with CVEA's internally prepared Power Requirement Study. 2.The forecast fails to account for any new large loads which have shown historical growth and others that may materialize in the future. 3.The forecast assumes no increase in energy requirements relative to maintenance Tequirements at the Alyeska terminal facility. In short,there has been considerable public comment focusing on Petro Star as driving the intertie case when,in fact,the study is so conservative as to growth in other sectors of CVEA's service area,on balance the overall medium high case is,in our opinion,reasonable. As for having a general pessimistic outlook for this part of the world,I would like to draw your attention to Exhibits B2 and B3,which graphically illustrate growth on CVEA's system in our 35-year history. We urge Beck to remain steadfast in the criticism received relative to the overall medium high load forecast as being a forecast which is defendable,reasonable,and supportable.) We would be pleased to respond to any questions you may have about the foregoing or the attached analysis,and we stand willing to provide any additional information necessary to support our analysis. Sincerely, Clayton Hurless General Manager C:\WPDOCS\CDH\94-041.NH COPPER VALLEY ELECTRIC *Schedule of Attachments Summary of Scenarios Medium High Load/Medium Fuel Diesel Expansion Case Allison Lake Sutton to Glennallen Intertie Non-Integrated Integrated into Railbelt Medium Low Load/Medium Fuel Diesel Expansion Case Allison Lake Sutton to Glennallen Intertie Non-Integrated Integrated into Railbelt Diesel Expansion Case Assumptions Allison Lake Case Assumptions Intertie Assumptions Sutton to Glennallen Intertie Amortization Schedule Allison Lake Amortization Schedule Diesel Unit Cost Assumptions Diesel Unit Amortization Schedules Table of Load Forecast Results Graphs Illustrating Growth Exhibit Page # Al AS.1-A5.4 A6.1 -A6.4 AT A8 A9 Al0 All Al2 Al3 Al4.1 -Al4.5 Bl B2.1 -B2.2 BERRY SUTTON TO GLENNALLEN 138 KV INTERTIE---POWER COST ANALYSIS--NON-INTEGRATED CAPACITY LEASE OR ECONOMY VS INTEGRATED FIRM2JANUARY.21,1994 REVISED 3/21/94 eee en a |ASSUMPTIONS3 4 INFLATION ADJUSTED 102.75%ANN.PAY. S 80 YEAR,ZERO INT.LOAN $35.0 MILLION $700,000 6 35 YEAR,6.00%LOAN $17,%MILLION $1,183,207 7 «TOTAL COST OF LINE $52.1 MILLION $1,883,207 6 POWER COST CUNF 19989 IKWHt?0.035 CAPACITY LEASE OR ECONOMY ENERGY--INCLUDES §MILL KWH FOR WHEELING TO MEA 9 POWEA COST FIAM 19988 (KWH)**90.056 INTEGRATED INTO RAILBELT SYSTEM --INCLUDES 1 MILL KWH FOR WHEELING TO MEA 10 YEAR 1998 1999 2000 2001 2002 2003 2004 12,CASE 1A--CAPACITY LEASE OR NON-FIRM--MEDIUM LOW LOAD--(NOT INTEGRATED) 13 (NFL.RATE 14 SUPPLEMENTAL KWH AEQ.36,909,000 37,549,000 38,188,000 28,898,000 39,639,000 40,282,000 40,900,000 41,809,000°42,118.000 42,729,000 43,347,000 49,972,000 44,605,000 48,246,/1S DEPRECIATION 91,063,088 91,043,088 91,043,088 #1.043,088 $1,043,088 1,042,088 $1,049,088 91.043.088 91,043,088 91,043,088 $1,043,008.$1,049,088 st.ossoss Siosaes shossoee seas 477207.000 fvomsces sregsoca -49-197.00018ANNUALINTEREST91,029,265 $1,020,029 91,010.298 $999,860 $986.659 -4977,198 -$964.898 951.738 937.848 ©4923.128 907.521 $290.980 873.446 8884.66)835.160 $034.277 6792142 S7eB OTe hsastece anaes17SUBTOTALDEBTSERVICE0%-$2,072.953 92,083,117 $2,053,326 92,042,948 $2,031,947 12.020,266 $2,007.926 61,994,524 91,980,936 91,966,214 $1.950,609 61,934.068 $1,916,534 91,897,949 91,878.248 91,857,365 91.035.230 S81.OIT 766 Styecene e1zoeue18DEOTSEAVICECOSTKWH0.0561 0.0550 0.0838)0.0825 (0.0573 «0.0502s(.0aBt =|(0.0481 0.0470 0.0460 0.0450 0.0440”0.0830 |0.0418 «=|0.0408 S.0399 |.0388 0.0378 aes Oaaer19LINEO&M EXPENSE 2.75%$263,412 $270,666 $278,099 $285,747 $293,605 $301,879 $309,978 6318,499 927,258 336,258 -$3485.50$6355.08 384,769 374,800 988,107 «395,607 408,578 417.780 bade nee saan eee20STANDAYLABOADIESEL2.75%$229,054 $295,353 9241825 -9248.475 255.308 $262,328 $269,844 4278,956 204,572 $202.398 -$300.439 $308,701 317.190 $325,913 $394.878 -«4348.085 8383847 «8309270 tava ace stevens21DIESELPLANTOLM2.75%414,527 917.676 9520,913 126,238 9027854 9131185 8134.772-4198.478 042,288 9148199 8150,219 154.950 9158585 8182.958 167.438 $172.062 178.776 ©«818NeIS thaw aso teraae22SUBTOTALLINEOP.COST $2,079,948 $2,686,002 $2,694,183 $2,701,408 $2,708,514 $2,715,459 92,722,218 $2,728,787 92,738.052 $2,741,088 92,746,772 42,752,128 $2,787,088 $2,761,618 $2,765,688 $2,789,169 62.772128 $2.774430 s2.90ec81 So teelnes23UNEOP.COST KWH 0.0728 0.0718 0.0705 O.0ese =0.0883 O.0a7e =0.0888 0.0887 .cees 0.0842 |0.0834 0.0828 0.0818 «0.0810 0.0603 0.0595 0.0887 ooseo Oo ern ee aelaeS24RESIOUALINTERESTDIESEL0%$147,000 $137,000 9428.00 $119,000 111,000 $105,000 998,000 $92,000 888.000 $80,000 $75,000 «$70,000 «826,000 «818,000 «83.000 .,.°roses 25 AES,DEPRECIATION DIESEL O%$244,000 $244,000 244,000 244,000 244.000 244.000 9244,000 $244,000 $244,000 -#195,000 , 26 SUB-TOTAL COST LESS PC.93,070,246 $3,087,802 93,066,163 $3,084,408 93,083,514 93,084,459 $3,066,216 99,084,757 $3,064,052 $3,018,068 $2,821,772 $2,822,128 $2,783,088 92,779,768,27 COST,LESS POWER COST KWH 0.0832 «0.0817 =«0.0803 0.0788 =(0.0773 =S|s«0.0781 0.0748 0.0738 0.0727,«|0.0708 (0.08 00842 0.0624 O0818 0.0803 Doses |oosey eae er josT2 ose28POWERCOST2.75%#0.201.818 91,380,140 $1.373.338 11,298.889 11.425.518 $1,448,641 $1,470,888 91,492,787 91.514.089 91,536,642 11,558,868 $1,581,349 $1,604,107 $1,627,159 1,850,499 11,674,162 99,697.002 81,721,348.41,7482 91.709.24729TOTALCOS362,4,417,942 94,439,4 4,463,2 4,808,738 94,513,100 $4,538,082 $4,657,526 $4,578,721 582,380,403, tae,ao e745,+789, COST OF POWER KWH 0.1162 0.1977 0.1163 0.1147 0.9213 0.1120 0.1109 0.1098 Bae Tes tat,MAGI MES (4.987.195 $4406,778 $4,419,167 $4,443,352 $4.469,811 94.495,775 -94.521.256 94,556,1180.1065 0.1011 0.100t 0.0984 0.0974 0.0963 0.0954 0.0926 32.CASE 2A--FIRM--MEDIUM LOW LOAD--(INTEGRATED) 33 . 34 COST OF SUPP.POWEA 2.75%-$2,068.904 $2,180,224 $2,197,338 $2,238,191 $2,280,628 $92,317.826 $2.383.386 62,306.428 $2,423,470 $2,458,627 $2,494,186 92,530,149 92,566,572 $2,609,455 92,640,798 $2.678.660 9235STANDBYLABORDIESEL2.75%$229,054 =$235,353 8241,828 =$248,475 =$255.308 =$262.329 =:$269,546 =$276,956 8204.572 9292,398 $300,439 $308,701 $317,190 =$325,913 $334,876 =3344,085 '369 307 pes 20 7373289 *igesze36DIESELPLANTO&M 2.75%$114,527 947.676 =-8920.913 $124,238 527.654 =139,165 134,772 $136,478 =-9.142,286 =148,199 160,219 154,950 158.595 $162,956 167.438 «$172,042 «9176.74 9181.835 9186,630 9191,76237RESIDUALINTERESTDIESELo%$147,000 $137,000 $128,000 =$119,000 $141,000 =$105.000 $98,000 $92.000 $85.000 $60,000 #75.000 $70,000 $26,000 $18,000 $3.000 ,,,,. 38 RES.CEPRECIATION DIESEL on”$244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $195,00039°TOTAL POWER COST $2,801,405 $2,894,254 $2,932,076 $2.973,904 $3,018,791 $3,060,320 $3,099,701 $3,139,862 $3,179,328 $3,172,224 $3,019,645 $3,063,200 $3,068,357 93,910,324 $3,146,192 $3,194,787 $3,246.61.2939,479,472,049,083,1.088,810,146,1.194,246,611 $3,299.05:..).406,'40 TOTAL COST KWH 0.0759 0.0771 0.0768 0.0785 0.0762 0.0760 0.0758 0.0756 0.0755 0.0742 0.0697 0.0897 0.0688 0.0887 0.0686 0.0686 0.0688 0.0889 "06st "ees ***ANNUAL SAVINGS $1,560,676 $1,523,689 $1,507,423 $1,489,373 $1,789,948 $1,452,780 $3,435,381 91,417,663 $1,399,393 $1,380,487 $1,360,794 $1,340,268 $1,318,838 $1,296,453 $1,273.0'1,24142TOTALSAVINGSFORSTUDYPERIOD$27,533,746 055 $1,248,565 $1,223,200 $1,196,719 $1.169,008 $1,150,034 44°BASED ON ML&P MIO CASE +1 MILL FOR WHEELING IML&P)LETTER FEBRARY 1994--°*BASED ON INFORMATION PROVIDED BY CHUGACH (DECEMBER 1993)°°SAVINGS COMPARING CASE 1 TO CASE 2.-a LV"qx TvnqryxgFILE:SUMCOMP.MARCH 18,1994 MEDIUM HIGH LOAO-MEDIUM FUEL YEAR 1998 1999 2000 2001 2002 2003 2004 SUPPLEMENTARY KWH REQUIRED 38,999 42,799 46,574 §0,386 54,000 .57,516 61,012 UNIT COST OF POWER----ALL VALUES EXPRESSED IN LINES 6,7,8 &9 ARE IN ¢KWH6 6 DIESEL ExP.COST OF POWER 0.1496 $0.1450 80.1420 90.1399 80.1366 §=40.1341 =40.13957ALLISONLAKEPOWERCOST80.1383 $0.1264 =40.2064 +=80.1957 $0.1872 $0.1802 =40.17688INTERTIE---NON-N-FIRM-NONANTEG.$0.1137 90.1077 0.1018 =90.0968 »=-80.1024 |$0.0892 =$0.08623$0.0748 $0.0747 30.0733 $0.0721 $0:Cea $0.0704 wns0638FeetenhtmeetSobat1%)ANNUAL POWER COST-ALL VALUES EXPRESSED WLINES 12,13,14 &16 'ARE INS ANNUALLY,Boor12O1ESELCASE{L3 x 16)95.834 $6,206 $6,614 $7,049 $7,376 $7,713 $8,51113°ALLISON LAKE {L3xL7)$5,394 95,410 $9,613 $9,861 $10,109 $10,364 $10,787 14 INTERTIE--NON-INTEG,(L3 x LO)94,434 $4,609 $4,741 64,877 $5,530 $5,130 $5,25915INTERTIENTEGRATED(L3 x ts)$2,917 $3,197 $3,ie mares 633 33.845 wit:049 $4,259WwW"ANNUAL SAVINGS---NON-INTEGRATED INTERTIE-=ALL VALUES EXPRESSED in s ANNUALLY 1000)18 INTEATIE TO DIESEL {L12-L14)$1,400 $3,009 $1,872 $3,416 $1,867 93,684 $3,25219INTERTIEroALLISONLAKE(L13-Li4)$959 $800 $4,872 $4,983 i.579 $5,234Bsin200AtiNUALSAVINGS--INTEGRATED |INTERTIE "ALL VALUES EXPRESSED IN ss "ANNUALLY (000)22 =INTEATIE TO DEISEL (L12-L16)}$2,917 $3.009 $3,200 $3,416 $3,532 $3,664 $4,25323INTERTIETOALLISONLAKE{13-116}92,476 62,213 $6,199 $6,228 $6,264 $6,315 $6,526 25 YEAR 1998 1999 2000 2001 2002 2003 200426RaseeananilasihdKWHilpeealaid369093754323188388983963940282409009wie2BYTES.ryeigti28UNITconeOFPOWER---ALL VALUES EXPRESSED IN #5 KWH 7 29 DEISEL EXPANSION CASE $0.1550 90.1577 $0.1611 =0.1615 $0.1619 =80.1627 $0.1747 34 ANNUAL Cost OF POWER--ALL VALUES EXPRESSED N ry'@ ANNUALLY (000)35 DIESEL CASE {(26xL29)$5,721 $6,921 $6,152 $6,282 $6,418 $6,554 $7,145 36 ALLISON LAKE ((26xL30)$5,282 $5,128 $9,157 $9,219 $9,283 $9,345 $9,558 37 INTERTIE--NON INTEGRATED ((26xL31)$4,363 $4.419 $4,441 $4,462 $4,808 $4,512 $4,536 ve A NTERTIE INTEGRATED kite $2,801 $2,895 a 933 $2,976 $3,020 $3,061 $3.100-.an rage Ve40"ANNUAL SAVINGS--NON INTEGRATED INTERTIEMALL VALUES EXPRESED iN s's ANNUALLY 000),41 INTEATIE TO DIESEL (138-137)$1,358 $1,602 $V70t $1,820 $1,609 $2,042 $2,60942eReREEToALLISONLAKE(t36-L37}$919 $710 $4,716 $4,757 $4,475 $4,834 $5,023TSARCoBeeERPaoTASHORLASEYedRENEoheGeaEVien44ANNUALSAVINGS---INTEGRATED INTERTIE-ACL VALUES EXPRESSED IN $'s ANNUALLY (000) 45 INTEATIE TO DIESEL {L35-L38)$2,920 $3,026 $3,219 $3,306 46 'NTERTIE TO ALLISON LAKE {L36-L38)$2,234 $6,225 $6,243$2,480 $5,528 30 ALLISON LAKE CASE 90.1431 $0.1366 §=$0.2398 §=-0.2370)80.2342 =40.2320 =$0.233731°INTERTIE-CL OR NF-NON INTEGRATED $0.1182 80,1177)90.1163 90.1147 60.1213 90.1920 =$0.110932_INTERTIE--FIRM--INTEGRATED mAs 0759 $0.0771 $0.0768 $0.0765 $0.pens 30.0760 $0.0758Feeyetesres: 7 :Kant a 3 vA SUMMARY OF COST COMPARISONS OF ALTERNATIVE POWER SUPPLY OPTIONS 2005 2006 2007 2008 61,622 82,230 62,842 63,459 $0.1410 =80.1425 =80.1433 90.1419$0.1766 90.1764 $0.1755 $0.1724 $0.0857 $0.0852 %0.0840 $0.0804 30.0697 $0.0697 80.0889 30.0658 $8,689 $6,868 $9,005 $9.005$10,882 $10,977 $11,029 $10,940 $5,281 $6,302 $5,279 $5,102 $4,295 $4,aa -330 $4,176 $4,394 $3,566 $4,675 $3,903 $5,60 $6,875 $5.750 $5.838 $4,394 $4,675 $4,829 $6,699 $6,785 2005 2006 2007 2008 41509 42118 42729 433473. 90.1788 «80.1762 $0.1760 =90.1725$0.2317 «80.2298 =680.2269 =$90.2207$0.1098 90.1087 $0.1065 =90.101190.0756 90.0755 $0.0742 30.0697 97.285 $7,421 $7,520 $7,477 $9,618 $9,679 $9,695 $9,567 $4,558 $4,578 $4,551 $4,382 $3,136 $3,160 $3,170 $3,021 $2,727 $2,843 $2,970 $3,095 $5.060 $5,100 95,145 $5,184 $4,456 $6,845 2009 64,084 2010 2011 2012 2013 64,717 65,359 66,007 66,665 90.1436 «80.1451 =80.1464 =80.1481 $0.1499$0.1723 80.1716 =$0.1716 «=60.1714 80.1771#0.0800 0.0790 %0.0785 %0.0779 $0.0775 $9,202 40.0659 0.0653 __$0.0853 _40.0852 40.0683SadiaBYRVieWAOATSep¥in 8 2 $9.390 $9,569 49,776 $9,993 $11,042 ($11,105 9 $11,216 =$11,314 =$11,809$5,127 a4,223 $4,979 $5,15 2009 43972 #0.1736 8 45.993 $5,013 $5,131 $5,142 $5,167 94,226 94,268 $4,304 $4,389 a ae Taas Geena $4,278 95,301 $4,634 $5,640 96;08s $6,172 $6,643 $5,164 $5,301 $5,472 $5,640 $6,879 $6,948 $7,010 97,456 "2010 2011 2012 2013 44605 48246 45895 46553 0.1745 =80.1749 90.1759 40.1772$0.2190 §80.2165 80.2148 «=80.2131 80.21170.1001 §=$0.0964 $0.0974 %0.0963 $0.0954 $0.0697 $0.0688 $0.0687 0 0686 $0.0686 $3,232 $5,228 $4,568 97,784 $7,914 $8,073 $8,249 $9,657 $9,723 $9,780 $9,955 $4,389 $4,407 $4,420 $4,441, $3,069 $3,108 $3,148 $3,194 $3,394 $3,507 $3,653 $3,808 $5,268 $5.316 $5.361 $5,414 $4,715 $4,805 $4,925 $5,056 5:$6,632 $6,662 2014 67,317 $0.1519 80.9715 $0.0771 $0.0654 $10,225 $11,545 $5,190 $4.4403 $5,035 $6,355 $5,823 $7,142 2014 47207 $0.1786 #0.2103 $0.0947 $0.0688 $6,431 $9,928 $4,471 $3,248 $3,961 $5,heeane $5,183 $6,680 2015 67,972 80.1520 30.1716 $0.0768 $0.0656 $10,332 $11,664 $5,220 $4,459 5,873 $6.444 $5,673 $7,205 2015 47865 90.1773 $0.2089 $0.0939 80.0689 $8,486 $9,999 $4,495 $3,298 A a3. $3,992 $5,504 $5,189 $6.701 $0.0657 2016 68,631 $0.1523 $0.1697 $0.0764 $10,453 $11,647 $5,243 $4,509 $5,209 $5,943 97,138 $4,560 96,403Re $0.1528 80.1682 $0.0762 $0.0858 $10,588 $11,655 $5,280 $6,029 $6,375 Ps $6,029 $7,096 2016 48529 90.1763 90.2048 90.0932 $0.0691 $3,353 $4,033 95.416 $5.202 $6,585 2017 49197 90.1757 $0.2009 90.0926 $0.0692 $8,644 $9,884 $4,556 $3,404 $4,088 $5,228 $5,239 $6,479 VCVUqMUxgCOPPER VALLEY ELECTAIC 3/18/94 BASE CASE-ALL DIESEL FILENAME:\SGL\CHOSLMH een HIGH-MEDIUM FUEL CASE FOURINFLATACTUALACTUALACTUALBUDGETYEAR FACTOR 1991 1992 1993 1994 AVG 1995 1996 1997 1998 1999 2000 2001 2002 2003 MWH REQUIREMENT SOLOMON GULCH 39,634 40,880 52,364 44,925 44,451 49,462 60,549 51,553 52,606 52,606 52,606 62,608 52,606 82,606EXISTINGDIESELS20,765 21,607 20,548 28,777 22,924 31,618 22,846 14,946 6,488 1,317 1,445 1,573 1,732 4,262NEWDIESELS11,300 21,539 32,712 41,630 45,264 48,915 52,338 §3,293SGL LOSSES (197)(201)(202)(201)(168)(135)(102)(70)(39)TOTAL REQ 60,395 62,487 72,912 73,702 67,375 80,883 84,494 87,836 91,605 95,385 99,180 102,992 106,606 110,122 TOTAL LESS SOLOMON 20,765 21,607 20,548 28,777 22,924 31,421 33,945 36,283 38,999 42,779 46,574 50,386 §4,000 57,516 FUEL GALLONS 2,417 2,611 2,502 2,600 2,760 3,005 3,251 3,484 3,711FUELEFFICIENCY131314.5 18 16.5 15.5 18.5 15.5 15.5 FUEL PRICE 2.75%0.75 0.771 0.792 0.814 0.836 0.859 0.883 0.907 0.932 OSL FUEL COST 1376 1252 1,176 1,412 1,304 1,813 2,012 1,981 2,115 2,307 2,581 2,869 3,159 3,458LABORA&E 2.75%84 65 87 79 79 83 85 88 90 93 95 98 100 103 LABOR PRODUCTION 2.75%689 750 837 748 756 793 814 837 860 883 908 933 958 985 ADD 3 OPERATORS SCH 0 0 0 [)0 0 (+)°0 330 339 348 358 368 ADD MAINTENANCE CREW SCH 0 0 )[)o )0 °°110 226 348 358 368 GOP GENERAL 2.75%152 89 214 208 166 211 217 223 229 238 242 248 255 262 GOP UNITS 2.75%109 71 285 1484 162 235 241 248 254 56 57 59 60 62 VOP GENERAL 2.75%75 162 269 141 162 205 21 216 222 228 235 241 248 285 VOP UNITS 2.75%83 288 89 162 156 126 129 132 136 56 87 59 60 62 OTHER 2.75%153 173 38 13 94 30 31 32 33 33 34 36 36 37 DSL INTEREST FIXED 220 212 205 192 207 179 168 187 147 137 128 119 141 105 DSL DEPREC FIXED 235 237 244 244 240 244 244 244 244 244 244 244 244 244 NEW DIESEL BLDG °°0 0 0 ft)0 133 133 133 133 133 133 133 NEW DIESELS O&M SCH °ty ()0 0 27 55 85 116 119 123 126 130 133 NEW DIESELS INTEREST SCH ft)0 0 t)0 172 346 622 698 678 655 632 607 580 NEW DIESELS DEPREC SCH 0 (i)0 0 0 132 269 41 558 558 558 558 558 558 TOTAL COSTS 3176 3299 3,444 3,383 3.326.4,248 4,822 5,308 5,836 6,201 6,615 7,051 7,377 7,712 COST PER KWH/SUPP 0.1529 $0.1527 $0.1676 $0.1176 $0.1451 $0.1952 $0.1420 90.1463 90.1496 40.1450 80.1420 80.1399 80.1366 80.1341 aCWNaqIyx”COPPER VALLEY ELECTRIC BASE CASE-ALL DIESEL FILENAME:\SGLICHDSLMH [MEDIUM HIGH-MEDIUM FUEL CASE 3/18/94 INFLAT : FACTOR 2004 2005 2008 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 MWH REQUIREMENT . SOLOMON GULCH 52,606 62,606 52,606 §2,606 52.606 52,606 52,606 52,606 52,606 52,606 52,606 §2,608 52,606 52,606 EXISTING DIESELS 1,937 1,955 2,190 2,249 2,368 2,489 2,611 2,736 2,859 2,985 3,110 3,236 3,362 3,671 NEW DIESELS 59,084 59,671 60,100 60,593 61,091 61,596 62,106 62,624 63,148 63,680 64,207 64,736 65,269 65,623SGL1 LOSSES (9)(4)i')°°0 0 i]°9 oO °o 0 i) TOTAL REQ 113,618 114,228 114,836 115,448 =116,065 116,690 117,323 117,965 118,613 119,271 119,923 120,578 121,237 121,901 TOTAL LESS SOLOMON 61,012 61,622 62,230 62,842 63,459 64,084 64,717 65,359 66,007 66,665 67,317 67,972 68,631 69,295 FUEL GALLONS 3,936 3,976 4,015 4,054 4,094 4,134 4,175 4,217 4,259 4,301 4,343 4,385 4,428 4,471 FUEL EFFICIENCY 16.5 16.5 15.5 16.5 15.5 15.5 15.5 16.5 16.5 15.5 16.5 15.5 15.5 15.5, FUEL PRICE 2.75%0.957 0.984 1.011 1.039 1.067 1.096 1.127 1.158 1.189 1.222 1,256 1,290 1,326 1.362 DSL FUEL COST 3,769 3,911 4,058 4,211 4,369 4,533 4.704 4,881 5,065 5,257 5,454 5,658 5,870 6,090LABORAG&E 2.75%106 109 112 116 118 121 125 128 132 135 139 143 147 151 LABOR PRODUCTION 2.75%1,012 1,039 1,068 1,097 1,128 1,159 1,190 1,223 1,257 1,291 1,327 1,363 1,401 1,439 AOD 3 OPERATORS SCH 378 388 339 410 421 433 445 457 470 483 496 S10 524 §38 ADD MAINTENANCE CREW SCH 378 388 399 410 421 433 445 457 469 482 495 509 523 538 GOP GENERAL 2.76%269 277 284 292 300 308 317 326 335 344 353 363 373 383 GDP UNITS 2.768%64 66 67 69 71 73 75 77 79 81 64 86 88 91 VOP GENERAL 2.75%262 269 276 284 292 300 308 316 328 334 343 353 362 372 VOP UNITS 2.75%64 66 67 69 71 73 76 77 79 81 a4 86 98 91 OTHER 2.75%38 39 40 42 43 44 45 46 46 43 50 52 §3 4 OSL INTEREST FIXED 98 92 85 90 76 70 26 18 3 []°0 °oO DSL DEPREC FIXED 244 244 244 195 t')0 t+)°0 0 °t¢)0 o NEW DIESEL BLOG 133 133 133 133 133 133 133 133 133 133 133 133 133 133 NEW DIESELS O&M SCH 173 178 183 188 193 198 204 209 215 221 227 233 240 246 NEW DIESELS INTEREST SCH 787 751 712 671 630 §82 563 479 424 364 300 233 178 133 NEW DIESELS DEPREC SCH 739 739 739 739 739 739 739 739 739 739 739 607 470 328 TOTAL COSTS 8,513 8,689 8,868 9,005 9,004 9,199 9,393 9,568 9,773 9,995 10,224 10,329 10,450 10,588 COST PER KWH/SUPP $0.13995 _$0.1410 80.1425 $0.1433 $0.1419 $0.1436 $0.1451 $0.1464 60.1481 $0.1499 90.1519 $0.1520 $0.1523 $0.1528 oes ae a -< OCWNqNXACOPPER VALLEY ELECTRIC 3/18/94 BASE CASE-ALL DIESEL SUPPORTING SCHEDULES FILENAME:\SGL\CHDSLMH MEDIUM HIGH-MEDIUM FUEL CASE INFLAT FACTOR 1992 1983 1994 1995 1996 1897 1998 1999 2000 2001 2002 2003 NEW DIESEL COSTS INTEREST EXPENSE 19956 172 168 163 158 183 147 141 134 127 INTEREST EXPENSE 1996 178 174 169 164 168 162 146 139 INTEREST EXPENSE 1997 185 180 175 169 164 158 181 INTEREST EXPENSE 1998 191 186 181 176 169 163 INTEREST EXPENSE 2004 SUB INT ON NEW UNITS 172 346 522 698 678 655 632 607 580 DEPRECIATION 1996 132 132 132 132 132 132 132 132 132 DEPRECIATION 1996 137 137 137 137 137 137 137 137 DEPRECIATION 1997 142 142 142 142 142 142 142 DEPRECIATION 1998 147 147 147 147 147 147 DEPRECIATION 2004 SUB DEPREC ON NEW UNITS 132 269 411 658 568 558 558 658 558 PLANTOPERATOR 2.75%91 94 96 99 101 104 107 110 413 116 119 123 AOD 1 MAINT CREW 2.75%91 110 113 116 119 123 ADD 1 MAINT CREW 2.75%91 Viz 116 119 123 ADO 1 MAINT CREW 2.75%91 116 119 122 TOTAL MAINT CREW °(')[*)[)110 226 348 358 368 CAPITAL COST 2150 KW.3.5%2,661 2,743 2,840 2,939 MAINTENANCE 1995 2.75%27 27 28 29 30 30 31 32 33 1996 2.75%27 23 29 30 31)31 32 33 1997 2.75%.28 29 30 31 32 33 33 1998 2.75%29 30 31 32 33 34 2004 2.76% TOTAL MAINT NEW UNITS 27 55 85 116 119 123 126 130 133 TOTAL MAINT OLO UNITS 2.75%50 51 §3 54 56 57 59 60 62 PCVUNqXACOPPER VALLEY ELECTRIC BASE CASE-ALL DIESEL FILENAME:\SGLICHDSLMH [MEDIUM HIGH-MEDIUM FUEL CASE NEW DIESEL COSTS INTEREST EXPENSE INTEREST EXPENSE -INTEREST EXPENSE INTEREST EXPENSE INTEREST EXPENSE SUB INT ON NEW UNITS OEPRECIATION DEPRECIATION DEPRECIATION DEPRECIATION DEPRECIATION SUB DEPREC ON NEW UNITS PLANTOPERATOR ADD 1 MAINT CREW ADO 1 MAINT CREW ADD 1 MAINT CREW TOTAL MAINT CREW CAPITAL COST 2150 KW MAINTENANCE TOTAL MAINT NEW UNITS TOTAL MAINT OLD UNITS 3/18/94 INFLAT FACTOR 2.76% 2.75% 2.75% 2.75% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 20156 2016 2017 120 112 104 95 86 76 95 53 41 28 15 132 124 116 108 99 83 78 67 55 43 239 16 144 137 129 120 112 102 92 81 70 57 44 30 16 156 149 141 133 125 115 106 95 84 72 59 46 32 16 235 229 222 215 208 200 192 183 174 164 153 142 130 117 787 751 712 671 630 §82 563 479 424 364 300 233 178 133 132 132 132 132 132 132 132 132 132 132 132 137 137 137 137 137 137 137 137 137 137 137 137 : 142 142 142 142 142 142°142 142 142 142 142 142 142 147 147 147 147 147 147 147 147 147 147 147 147 147 147 181 181 181 181 181 181 181 181 181 181 181 .181 181 181 739 739 739 739 739 739 739 739 739 739 739 607 470 328 126 129 133 137 140 144 148 152 157 161 165 170 175 179 126 129 133 137 140 144 148 162 167 161 165 170 174 179 126 129 133 137 140 144 148 152 158 161 165 170 174 179 126 129 133 137 140 144 148 152 186 161 165 170 174 179 378 388 399 410 421 433 445 457 469 482 495 509 523 §38 3,613 34 35 36 37 38 39 40 41 42 43 44 46 47 48 34 35 36 37 38 39 40 41 42 44 45 46 47 48 34 35 36 37 338 39 40 42 43 44 45 46 48 49 35 36 37 38 39 40 41 42 43 44 45 47 48 49 36 37 38 39 40 41 43 44 45 46 47 49 50 §1 173 178 183 188 193 198 204 209 216 221 227 233 240 246 64 66 67 69 71 73 75 77 79 a1 84 86 88 91 DevvqrxgCOPPER VALLEY ELECTRIC 3/21/94 ALLISON LAKE FILENAME:\SGL\CHALLMH [MEDIUM HIGH-MEDIUM FUEL CASE FOUR INFLAT ACTUAL ACTUAL ACTUAL BUOGET YEAR FACTOR 1991 1992 1993 1994 AVG 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 MWH REQUIREMENT : SOLOMON GULCH 39,634 40,880 52,364 44,925 44,481 49,462 60,549 51,653 52,606 52,606 62,608 82,606 62,606 52,608 52,606 EXISTING DIESELS 20,765 21,607 20,648 28,777 22,924 31,618 22,846 14,946 6,488 5,050 109 237 361 482 601 NEW DIESELS 11,300 21,539 32,712 37,897 19,886 23,536 26,993 30,357 33,705ALLISONLAKE26,7158 26.715 28,715 26,715 26,715LOSSES(197)(201)(202)(201)168)(135)(102)(70)(39)(9) TOTAL REQ 60,399 62,487 72,912 73,702 67,375 80,883 84,494 87,836 91,605 95,385 99,180 102,992 106,605 110,121 113,618 TOTAL LESS SOLOMON 20,765 21,607 20,648 28,777 22,924 31,421 33,945 36,283 38,999 42,779 46,574 $0,386 53,999 57,516 61,012 FUEL GALLONS 2,432 2.627 2,516 2,613 2,771 1,290 1,534 1,765 1,990 2,213 FUEL EFFICIENCY 13 13 14.6 16 18.5 16.5 15.5 18.5 15.5 15.5 FUEL PRICE 2.75%0.75 0.771 0.792 0.814 0.836 0.869 0.883 0.907 0.932 0.957 SOLOMON GULCH RATE 2.75%0.064 0.064 0.064 0.066 0.0645 0.066 0.067 0.067 0.068 0.069 0.070 0.071 0.071 0.072 0.073 DSL FUEL COST 1,376 1,252 1,176 1,412 1,304 1,824 2,024 1,992 2,126 2,316 1,108 1,354 1,600 1,854 2,119 LABOR A &E 2.75%84 65 87 79 79 83 85 88 90 93 95 98 100 103 106 LABOR PRODUCTION 2.75%689 750 837 748 766 793 314 837 860 741 761 782 804 826 848 AOD 3 OPERATORS SCH °°0 °°°°o 0 i)0 0 °0 o ADD MAINTENANCE CREW SCH °0 0 °°0 °0 o °°°°°° GOP GENERAL 2.75%162 89 214 208 166 2u1 217 223 229 238 242 248 255 262 269 GOP UNITS 2.75%109 71 285 184 162 235 241 248 254 56 $7 59 60 62 64 VDP GENERAL 2.75%75 162 269 141 162 205 211 216 222 228 235 241 248 255 262 VOP UNITS 2.75%83 288 89 162 156 126 129 132 136 56 67 59 60 62 64 OTHER 2.75%163 173 38 13 34 30 31 32 33 33 34 35 36 37 38 OSL (INTEREST FIXED 220 212 205 192 207 179 168 157 147 137 128 119 WW 105 98 DSL DEPREC FIXED 235 237 244 244 240 244 244 244 244 244 244 244 244 244 244 SOLOMON POWER COST °0 0 i)0 0 0 °0 0 932 943 984 966 978 ALLISON INTEREST 3,138 3,110 3,080 3.048 3,015 ALLISON DEPRECIATION :1,048 1,046 1,046 1,046 1,046 ALLISON O &M 2.75%284 292 300 308 317 NEW DIESEL BLOG 0 0 0 0 0 i)0 oO i)0 0 0 0 °0 NEW DIESELS O&M SCH i)°o _o 0 Qo 0 27 67 88 120 124 127 131 134 138 NEW DIESELS INTEREST SCH ')o 0 0 9 0 178 369 540 723 701 678 654 ,628 601 NEW DIESELS DEPREC SCH oO 0 i')9 i')o 137 279 426 426 426 426 426 426 578 TOTAL COSTS 3,176 3.299 3,444 3,383 3,326 3,929 4,506 4,863 6,395 5.409 9,612 9,861 10,110 10,366 10,784 COST PER KWH/SUPP $0.1529 90.1527 $0.1676 $0.1176 $0.1451 90.1250 -$0.1328 90.1340 $0.1383 30.1264 $0.2064 $0.1957 $0.1872 $0.1802 $0.1768 TEVUGXCOPPEA VALLEY ELECTRIC ALLISON LAKE FILENAME:\SGL\CHALLMH [MEDIUM HIGH-MEDIUM FUEL CASE MWH REQUIREMENT SOLOMON GULCH EXISTING DIESELS NEW OIESELS ALLISON LAKE LOSSES TOTAL REQ TOTAL LESS SOLOMON FUEL GALLONS FUEL EFFICIENCY FUEL PRICE SOLOMON GULCH RATE OSL FUEL COST LABOR A GE LABOR PRODUCTION ADD 3 OPERATORS | ADD MAINTENANCE CREW GOP GENERAL GDP UNITS VOP GENERAL VOP UNITS OTHER DSL INTEREST OSL DEPREC SOLOMON POWER COST ALLISON INTEREST ALLISON DEPRECIATION ALUSONO &M NEW DIESEL BLOG NEW DIESELS O&M NEW DIESELS INTEREST NEW DIESELS DEPREC TOTAL COSTS COST PER KWH/SUPP 3/21/94 INFLAT : FACTOR 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2016 2016 2017 52,606 52,606 52,606 52,606 52,606 52,606 $2,606 62,606 $2,606 52,606 52,606 §2,606 52,606 619 794 913 1,033 1,184 1,276 1,399 1,823 1,649 1,774 1,900 2,026 2,153 34,291 34,720 35,214 35.712 36,216 36,727 37,244 37,769 38,301 38,827 39,367 39,890 40,245 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,716 26,715 26,715 14)i!)9 0 i]9°0 o i)i][]Oo t'] 114,227 114,835 «115,448 «116,066 116,691 117,324 «117,964 118,613 119,271 419,922 120,578 121,237 121,719 61,621 62,223 62,842 63,460 64,085 64,718 65,358 66,007 66,665 67,316 67,972 68,631 69,113 2,252 2,291 2,331 2,371 2,411 2,452 2,493 2,535 2,877 2,619 2.662 2.704 2.735 15.5 16.5 18.5 15.5 16.5 15.5 16.5 16.5 16.5 15.5 18.6 15.5 15.5 2.75%0.984 1.011 1.039 1.067 1.096 1.127 1.158 1.189 1.222 1.256 1.290 4.326 1.362 2.75%0.074 0.075 0.076 0.077 0.078 0.079 0.080 0.081 0.082 0.084 0.085 0.086 0.087 2,216 2.316 2,421 2,530 2,644 2,762 2,886 3,015 3.150 3.289 3,435 3.585 3,726 2.75%103 112 115 118 121 125 128 132 135 139 143 147 151 2.75%872 996 $20 946 972 998 1,026 1,054 1,083 1,113 1,143 1,175 1,207 SCH 0 0 °°0 °0 °0 0 0 i)0 SCH °0 °°0 °o °o o o o 0 [) 2.78%277 284 292 300 308 317 326 335 344 353 363 373 383 2.78%66 67 69 71 73 75 77 79 a1 84 86 88 91 2.75%269 276 284 292 300 308 316 325 334 343 353 362 372 2.75%66 67 69 71 73 78 77 79 81 84 86 88 91 2.75%39 40 42 43 a4 45 46 48 49 60 62 §3 54 FIXEO 92 85 80 75 70 26 18 3 o °0 °0 FIXEO 244 244 195 °90 °°0 °°o [J ° 990 1,062 1,016 1,028 1,042 1,056 1,070 1,085 1,100 1,116 1,132 1,148 1,166 2,979 2,941 2,901 2.859 2,814 2.767 2,716 2,663 2,606 2,546 2,482 2,415 2,343 1,046 1,046 1,046 1,046 1,046 1,046 1,048 1,046 1,046 1,046 1,046 1,046 1,046 2.75%325 334 343 353 363 373 383 393 404 415 427 438 450 Qo 0 0 0 )0 0 0 [')0 0 0 0 SCH 142 146 150 154 158 162 167 171 176 181 186 191 196 SCH 572 640 507 474 435 395 352 307 259 208 152 96 49 SCH 578 578 578 $78 578 578 578 578 $78 578 $78 441 299 10,880 10,976 11,027 10,937 11,040 11,108 11,213 11,314 11,427 11,545 11,662 11,648 11,626 $0.1766 80.1764 $0.1755 $0.1724 $0.1723 $0.1716 90.1716 $0.1714 $0.1714 90.1715 $0.1716 $0.1697 $0.1682 CCVUGX”COPPER VALLEY ELECTRIC 3/21/94 ALLISON LAKE FILENAME:\SGL\CHALLMH SUPPORTING SCHEDULES MEDIUM HIGH-MEDIUM FUEL CASE INFLAT FACTOR 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 NEW DIESEL COSTS INTEREST EXPENSE 1996 178 174 169 164 158 152 146 139 INTEREST EXPENSE 1997 185 180 175 169 164 158 151 INTEREST EXPENSE 1998 191 186 181 175 169 163 INTEREST EXPENSE 1999 198 193 187 181 175 SUB INT ON NEW UNITS 0 178 359 540 723 701 678 654 628 DEPRECIATION 1996 137 137 137 137 137 137 137 137 DEPRECIATION 1997 142 142 142 142 142 142 142 DEPRECIATION 1998 147 147 147 147 147 147 DEPRECIATION 1999 SUB DEPREC ON NEW UNITS 0 137 279 426 426 426 426 426 426 PLANTOPERATOR 2.75%91 94 96 99 101 104 107 110 113 116 119 123 ADD 1 MAINT CREW 2.75%91 0 0 0 0 fr) ADO 1 MAINT CREW 2.75%91 0 o 0 o ADD 1 MAINT CREW 2.75%91 0 Ce)o TOTAL MAINT CREW 0 0 0 0 0 0 0 0 0 CAPITAL COST 2150 KW 3.5%2,743 2,840 2,939 3,042 MAINTENANCE 1996 2.75%27 28 29 30 31 31 32 33 1997 2.75%28 29 30 31 32 33 331998--2.75%29 30 31 32 33 34 1999 2.75%30 31 32 33 34 TOTAL MAINT NEW UNITS 0 a7 57 88 120 124 127 131 134 TOTAL MAINT OLD UNITS 2.75%50 51 53 64 56 57 59 60 62 PEVNqUXACOPPER VALLEY ELECTRIC 3/21/94 ALLISON LAKE FILENAME:\SGLICHALLMH [MEDIUM HIGH-MEDIUM FUEL CASE NEW DIESEL COSTS INTEREST EXPENSE 1996 INTEREST EXPENSE 1997 INTEREST EXPENSE 1998 INTEREST EXPENSE 1999 $UB INT ON NEW UNITS DEPRECIATION 1996 DEPRECIATION 1897 DEPRECIATION 1998 DEPRECIATION 1999 SUB DEPREC ON NEW UNITS PLANTOPERATOR AOD 1 MAINT CREW AOD 1 MAINT CREW ADD 1 MAINT CREW TOTAL MAINT CREW CAPITAL COST 2150 kw MAINTENANCE TOTAL MAINT NEW UNITS TOTAL MAINT OLD UNITS INFLAT FACTOR 2.75% 2004 2005 2008 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 132 124 116 108 99 89 78 67 55 43 29 15 144 137 129 120 112 102 92 81 70 57 44 30 16 156 149 141 133 125 115 106 95 84 72 53 46 32 16 169 162 184 146 138 129 119 103 98 87 76 61 48 33 601 572 640 507 474 435 395 352 307 259 208 182 96 49 137 137 137 137 137 137 137 137 137 137 137 137 142 142 142 142 142 142 142 142 142 142 142 142 142 147 147 147 147 147 147 147 147 147 147 147 147 147 147 152 152 162 152 152 152 182 162 182 152 152 152 152 152 §78 578 578 578 578 578 §78 $78 578 578 578 578 441 299 126 129 133 137 140 144 148 152 157 161 165 170 175 179 t+)0 t')0 i)t*)()o t)(+)i)i)Qo ° (°))t')t¢)t'))9 0 t')t')°o Oo te 0 °o 0 [*]0 0 oO °9 9 9 0 i?)0 [')o 0 i?)0 0 °o Q 0 ty)°oO i) 34 35 36 37 38 39 40 41 42 44 45 46 47 48 34 35 36 37 38 39 40 42 43 44 45 46 48 49 35 36 37 38 39 40 41 42 43 44 45 47 48 49 35 36 37 38 39 40 41 42 43 44 46 47 48 50 138 142 146 150 154 158 162 167 171 176 181 186 191 196 64 66 67 69 71 73 76 77 79 81 84 86 a8 91 EE sutton TO GLENNALLEN 138 KV INTERTIE---POWER COST ANALYSIS--NON-INTEGRATED CAPACITY LEASE OR ECONOMY ENERGY VS INTEGRATED FIRM ENERGY ee S|2.JANUARY,21,1994 REVISED 3/21/94 3.ASSUMPTIONS 4 INFLATION AQJUSTED 102.75%ANN.PAY, &50 YEAR,ZERO INT.LOAN $38.0 MILLION $700,000 6 35 YEAR,6.00%LOAN 917-4 MILLION,01,183,207 7 TOTAL COST OF LINE 352.1 MILLION 91,883,207 &POWER COST CLIN 1989's IKWHIS 90.035 CAPACITY LEASE OR ECONOMY ENERGY-INCLUDES 1 MILL KWH FOR WHEELING TO MEA 9 POWER COST--FIRMI998 8's (KWHI**90.056 INTEGRATED INTO AAILBELT SYSTEM INCLUDES 1 MILL KWH FOR WHEELING TO MEA : 10 YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2008 2007 2008 2009 2010 2011 2012 2013 2014 2015 2018 2017 12.CASE 1A-NON-FIRM--MEDIUM HIGH LOAD--(NOT INTEGRATED) 3 WNFL,RATE 14 SUPPL.KWH REQ,38,999,000 42,779,000 46,874,000 $0,388,000 64,000,000 $7,516,000 61,012,000 61,622,000 62,230,000 62,842,000 63.469,000 €4,084,000 64,717,000 85,389,000 66,007,000.622,.230,842,469,084,717,389,,007,000 66,685,000 67,317,972,. 18 DEPRECIATION #1043088 41043.008 $1,043,068 11,043,088 01,043,088 $1,043,080 11,042,008 91,063,088 $1,069,088 -$1,069,088 01,049,088 $1,042,080,$1,043,008,81.069 008 81062008 S1O4NOOD FLDINOSE.S1DEROOD Creo eae £2:208.00016ANNUALINTEREST$1,029,268 $1,020,029 91,010.238 -6999.860 $988.859 «$977,198 -$964.838 «951.736 «$937,848 $923,126 «907.521 9880980 9873.446 «854.861 835,160 814.277 «792142 +-«8:788.678 «$743,808 «727442 17°SUBTOTAL DEBT SERVICE 0%-92,072.353 $2,083,117 $2,053,328 $2,042,948 $2,031,947 $2,020,286 $2,007,926 $1,994,824 91,980,936 91,966.216 $1,950,609 $1,934,068 $1,916,534 $1,807.949 $1,878,246 $1,857,368 $1,835,230 $1,811,766 $1,786,894 $1,770.30 18 DEBT SEAVICE COST KWH 0.0531 0.0482 0.0441 0.0408 0.0376 0.0351 0.0329 0.0324 0.0318 0.0313 0.0307 0.0302 0.0296 0.0280 |0.0285 0.0279 0.0273 |«0.0287,«|0.0260 0.0256 19 UNE O&M EXPENSE 2.75%$263,412 270,856 278,099 $205,747 9293,605 «$301,679 «309,975 «$318,499 $327,258 336.258 «245,505 355.006 $384,769 -$374.400 «$985,107 -«8995.697 408,579 0417,760 -9429,248 $441,059 20 STANDBY LABOR DIESEL 2.75% 9220,054 $235,353 $241,825 «8.248.475 255,308 «$262,329 8769544 «276.988 «8.284.572 282.398 -«8300.439 «308,70 317,190 0328.913 -6334.878 $344,088 -«8383.547 «$363,270 «$373,259 8389524 21 DIESEL PLANT O&M 2.75%8014,5270117,876 «8120013 -8424.238 «927.054 -9134,168 134.772 -8138.478 -9142,286 -9148,199 «150.219 «154.350 9188595 162.958 9167.438 «172,062 -«8178,774 «$181,635 8186.630 819.762 22 SUBTOTAL LINE OP.COST $2,079,346 $2,686,802 $2,694,163 $2.701.408 $2,708,514 92,716,459 92.722.216 $2,728,787 92,735,052 $2,741,068 92,746,772 2.752.128 $2,757,088 02,761,618 $2,765,688 92,769,189 $2,772,129 92,774,430 $2,776,031 92,786.869 23°UNE OP.COST KWH 0.0687 0.0626 0.0578 0.0536 0.0502 0.0672 0.0446 0.0443 0.0440 0.0436 0.0433 0.0428 0.0426 0.0423 0.0419 0.0418 0.0412,O.0408 "ox 24 RESIDUAL INTEREST DIESEL 0%147,000 «$437,000 128,000 119,000 $111,000 $105,000 «898,000 «882,000 «$88,000 «$80,000 «$78,000 «$70,000 «28,000 -=-«#18,000 $3,000 :::exoe S.0802 25 AES,DEPRECIATION DIESEL 0%244.000 $244,000 «$244,000 $244,000 $244,000 244.000 $244,000 $244,000 $244,000 195,000 ,.° 26 SUB-TOTAL COST LESS P.C.$3,070,246 93,087,802 $3,068,163 93,064,408 $3,083,814 $3,084.459 $3,084,216 93,064,757 $3,084.052 $3,016,068 $2,821,772 $2,822,125 $2,783,088 92,779,618 $2,768,608084,,084,086,018,821,,822,783,779,768.668 $2,769,189 92.772,774,. 27 COST,LESS POWER COST KWiHt 0.0787 0.0717 0.0658 0.0608 0.0567 0.0833 0.0802 0.0497 0.0492 0.0480 0.0645 0.0440 0.0430 |(0.0425 0.0419 0.0615 one we oaege pate?28 POWER COST 2.78%91,366,965 01,538,440 91.674.917 $1.012.007 91,941,975 $2,066,419 92,194,146 92,216,081 $2,237,946 2.259.955 62,282,144 $2,204,621 $2,327,385 $2,350,473 $2,373,777 $2,307,440 $2,420,888 $2,444,443 92,468,142 $2,492,021 29 TOTAL COST OF POWER $4:438,311 $4,608,242 94,747,080 94,876,414 95,531,657 95,132,878 95,258,360 95,260.838 $5,301,999 96,276.024 95,103,916 96,126,746 96,110,473 95,130,091 5.142.448 98,166,629 $8,193,017 95.218.873 95,244,174 $5,278,890 30 COST OF POWER KWH 0.1137 0.1077 0.1018 0.0988 0.1024 0.0892 0.0862 0.0857 0.0852 0.0840 0.0806 0.0800 0.0730 0.0788 0.0779 0.0775 0.0771 «0.0788 =«0.07864 0.0762 32.CASE 2A--FIAM--MEDIUM HIGH LOAD--(INTEGRATED) 23 ° ' 34 COST OF SUPP.POWER 2.75%02,183.94 $2,481,504 $2.679.868 $2,899,210 $3,107,160 $3,309,471 $3,510,830 62,545,730 93,580.714 93,615,929 03,651,431 $3,687,993 $9.723.818 99,760,787 3.798.063 93,83545,580.818,651,687,723,,760,.798,835,904 $3,873.420 83.911. 36 STANDBY LABOR DIESEL 278m 229.084 0296989 8200.825 $248-478 -$2S5-308 $262.329 820984 8276088 $204672 282.998 |8200439 4308701 $917,180 $928.913 8338876 $3aa00s Sa5RS47 8382-270 Savaaey saeneee 36 DIESEL PLANT O&M 275%«6404527 8917,876 «120.913 -0124,238 127.654 «$13,165 914.772 9038.47 «142.286 ©9146,199 $150,219 «184.350 158,595 9167,956 $107.438 172.042 -«-8'476.774 «681.635 -«-8188.830 -$199.762 37 RESIOUAL INTEREST DIESEL 0%$147,000 $137,000 $128,000 $119,000 $111,000 $108,000 «$98,000 «$92,000 485,000 «$80,000 «875,000 =$70,000:$26,000 -«818,000 93.000 ,°..” 38 RES.DEPRECIATION DIESEL 0%244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $198,000 ,, 3@ TOTAL POWER COST $7,918,525 $3,195,533 $3,414,608 $3,624.926 $3,845,123 $4,051,965 94,256,948 94,297,164 $4,336,573 $4,329,526 04,177,089 $4,220,445 $4,225,602 94,267,626 $4,303,356 $4,352,031256,297,338,329,177,220,228,287,303,.352,031 94,403,741 94,486,013 $4,508:562. 40 TOTAL COST KWH 0.0748 0.0747 0.0733 0.0721 0.0712 0.0704 0.0898 0.0897 0.0697 0.0889 0.0858 0.0859 0.0853 0.0653 0.0652 0.0853 0.0654 0.0086 oes?oosse 4).°"ANNUAL SAVINGS 93,516,786 $1,410,709 $1,326,474 $1,241,491 91,686,534 $1,080,913 $1,001,414 $989,675 $965,426 $946,496 926.827 $906,301 $084,872 $662,465 42 TOTAL SAVINGS FOR STUDY PERIOD $20,397,036 ;,BO99 009 NONASIG4789278 $782,080 4795.28 4718.970 44.BASED ON MLGP MID CASE (ML&P LETTER FEB,9474 1 MILL FOR WHEELING [MEA LETTERI.-°*BASEO ON_INFORMATION PROVIDED BY CHUGACH {DECEMBER 1993)__***SAVINGS COMPARING CASE 1_TO CASE 2.|_44 _BASED ON MLGP MID CASE (MLGP LETTER FEB.947+)MILt_FOR WHEELING (MEA LETTER!°°BASED Gs.pVuqyx” TovwqryxgCOPPER VALLEY ELECTRIC 3/18/94 BASE CASE-ALL DIESEL FILENAMEASGL\CHDSLML MEDIUM LOW-MEDIUM FUEL CASE FOUR INFLAT ACTUAL ACTUAL ACTUAL BUDGET YEAR FACTOR 1991 1992 1993 1994 AVG 1995 1996 1997 1998 1999 2000 2001 2002 2003 MWH REQUIREMENT ; SOLOMON GULCH 39,634 40,880 52,364 44,925 44,451 49,462 60,549 61,653 61,824 62,097 62,376 62,606 52,608 62,606 EXISTING DIESELS 20,768 21,607 20,548 28,777 22,924 31,618 22,846 14,946 8,149 1,113 1,335 1,899 1,189 1,208 NEW DIESELS 11,300 21,639 31,964 36,635 37,060 37,206 36,651 39,270 SGL LOSSES (197)(201)1202)(204)(205)(207)(207)(201)(196) TOTAL REQ 60,399 62,487 72,912 73,702 67,375 80,883 84,494 87,836 88,733 89,640 90,564 91,504 92,245 92,888 TOTAL LESS SOLOMON 20,765 21,607 20,548 28,777 22,924 31,421 33,945 36,283 36,909 37,543 38,188 38,898 39,639 40,282 FUEL GALLONS 2,417 2,611 2,502 2,461 2,422 2,464 2,510 2,557 2,599 FUEL EFFICIENCY 13 13 14.5 16 16.5 15.5 16.5 16.5 15.5 FUEL,PRICE 2.75%0.75 0.771 0.792 0.814 0.836 0.859 0.883 0.907 0.932 OSL FUEL COST 1376 1262 1,176 1.412 1,304 1,813 2,012 1,981 2,002 2,025 2,116 2,215 2,319 2,422 LABOR A &E 2.75%84 65 87 79 79 83 85 88 90 93 95 98 100 103 LABOR PROOUCTION 2.76%689 750 837 748 766 793 814 837 860 883 908 933 958 985 ADD 3 OPERATORS SCH (')(')°[*]0 °°[s)0 330 339 348 358 368 ADD MAINTENANCE CREW SCH ()[)(+)(1)(')()°0 [)110 226 232 239 245 GOP GENERAL 2.75%162 a9 214 208 166 au 217 223 229 235 242 248 255 262 GOP UNITS 2.75%109 ”285 184 162 235 241 248 254 56 67 59 60 62 VOP GENERAL 2.75%75 162 269 141 162 205 211 216 222 228 235 241 248 255 VOP UNITS 2.75%63 288 89 162 166 126 129 132 136 66 87 59 60 62 OTHER 2.76%153 173 38 13 94 30 31 32 33 33 34 35 36 37 OSL INTEREST FIXED 220 212 205 192 207 179 168 187 147 137 128 119 wi 105 DSL DEPREC FIXEO 235 237 244 244 240 244 244 244 244 244 244 244 244 244 NEW DIESEL BLOG (¢]0 °t+)°()°133 133 133 133 133 133 133 NEW DIESELS O&M SCH ()0 °o [)0 27 55 85 116 119 123 126 130 133 NEW DIESELS INTEREST SCH []°()°°o 172 346 622 698 678 655 632 607 680 NEW DIESELS DEPREC SCH C)[)°()(:)132 269 411 558 658 658 558 558 558 TOTAL COSTS 3176 3299 3,444 3,363 3,326 4,248 4,822 6,308 6,722 5,919 6,150 6,281 6,417 6,554 COST PER KWH/SUPP $0.1629 $0.1627 $0.1676 $0.1176 $0.1451 $0.1352 $0.1420 $0,1463 $0.1650 $0.1577 $0.1611 $0.1615 $0.1619 $0.1627 aSvNqNXACOPPER VALLEY ELECTAIG 3/18/94leeCASE-ALL DIESELFILENAME:ASGL\CHOSLML "LOW-MEDIUM FUEL CASE INFLAT FACTOR 2004 2008 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 MWH REQUIREMENT SOLOMON GULCH 52,606 62,606 52,606 52,606 52,606 2,606 52,608 52,608 52,606 52,606 52,606 52,6068 52,606 52,606 EXISTING DIESELS 1,226 1,244 1,262 1,280 1,298 1,316 1,335 1,354 1,373 1,392 1,411 1,430 1,450 1,469 NEW DIESELS . 39,865 40,452 41,038 41,627 42,222 |42,824 43,434 44,051 44,676 46,310 45,940 46,574 47,213 47,856 SGL 1 LOSSES (191)187)(182)(178)(173)(168)(164)(189)(184)(149)144)(199)134)(129) TOTAL REQ 93,506 94,116 94,724 96,345 95,953 96,578 97,211 97,852 98,501 99,159 99,813 100,471 101,135 101,803 TOTAL LESS SOLOMON 40,900 41,509 42,118 42,729 43,347 43,972 44,605 45,246 45,895 48,553 47,207 47,865 48,529 49,197 FUEL GALLONS 2,639 2,678 2717 2,787 2,797 2,837 2,878 2,919 2,961 3,003 3,046 3,088 3,131 3,174 FUEL EFFICIENCY 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 18.5 15.5 16.5 15.5 15.5 FUEL PRICE 2.75%0.957 0.984 1.011 1.039 1.087 1.096 1.127 1.158 1,189 1.222 1.256 1.290 1.326 1.362 DSL FUEL COST 2,526 2,634 2,747 2,863 2,984 3,111 3,242 3,379 3,522 3,671 3,825 3,985 4,151 4,324LABORALE2.78%108 1039 112 115 118 123 126 128 132 135 139 143 147 151 LABOR PRODUCTION 2.76%1,012 1,039 1,068 1,097 1,128 1,159 1,190 1,223 1,287 1,291 1,327 1,363 1,401 1,439 ADD 3 OPERATORS SCH 378 3a8 399 410 421 433 445 457 470 483 496 510 624 538 AOD MAINTENANCE CREW SCH 252 259 266 273 281 289 296 305 313 322 330 340 349 358 GDP GENERAL 2.75%269 277 284 292 300 308 a7 326 335 344 353 363 373 383 GDP UNITS 2.75%64 66 67 69 n 73 78 77 79 a1 84 86 88 91 VOP GENERAL 2.75%262 269 276 284 292 300 308 316 325 334 343 353 362 372 VOP UNITS 2.75%64 66 67 69 ral 73 75 77 79 a1 84 86 88 91 OTHER 2.75%38 39 40 42 43 44 45 46 48 49 50 52 53 54 DSL INTEREST FIXED 98 92 85 80 76 70 268 18 3 °0 0 0 ry DSL DEPREC FIXED 244 244 244 195 0 0 0 0 0 0 0 0 0 0 NEW DIESEL BLOG 133 133 133 133 133 133 133 133 133 133 133 133 133 133 NEW DIESELS O&M SCH 173 178 183 188 193 198 204 209 215 221 227 |233 240 246 NEW DIESELS INTEREST SCH 787 761 712 671 630 582 563 479 424 364 300 233 178 133 NEW DIESELS DEPREC SCH 739 739 739 739 739 739 739 739 739 739 739 607 470 328 TOTAL COSTS 7,145 7,283 7,423 7,521 7,479 7,632 7.783 7,913 8,073 8,248 8,430 8.485 8,557 8.642 COST PER KWH/SUPP 80.1747 $0,1755 =$0.1762 80.1760 =80.1725 =80.1736 »=-80.1745 =80,1749 =80.1769 40.1772 80.1786 =0.1773 =$0.1763 =80.1757 SvNalEXYCOPPER VALLEY ELECTRIC 3/18/94 BASE CASE-ALt DIESEL SUPPORTING SCHEDULES FILENAME:\SGLICHDSLML MEDIUM LOW-MEOIUM FUEL CASE INFLAT FACTOR 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 NEW DIESEL COSTS . INTEREST EXPENSE 1995 172 168 163 158 183 14?141 134 127 INTEREST EXPENSE 1998 :178 174 169 164 158 152 146 139 INTEREST EXPENSE 1997 185 180 175 169 164 158 151 INTEREST EXPENSE 1998 191 186 161 175 169 163 INTEREST EXPENSE 2004 SUB INT ON NEW UNITS 172 346 §22 698 678 655 632 607 580 DEPRECIATION 1995 132 132 132 132 132 132 132 432 132 DEPRECIATION 1996 137 137 137 137 137 137 137 137DEPRECIATION1997142142142142142142142 DEPRECIATION 1998 147 147 147 147 147 147 DEPRECIATION 2004 SUB DEPREC ON NEW UNITS 132 269 ail 558 558 556 §5a 558 558 PLANTOPERATOR 2.75%91 94 36 99 tot 104 107 110 183 116 119 123 AOD t MAINT CREW 2.75%a1 110 113 116 119 123 AOD 1 MAINT CREW 2.75%91 :113 116 119 123 ADD 1 MAINT CREW 2.75%i]° TOTAL MAINT CREW [')[)(')0 110 226 232 239 245 CAPITAL COST 2150 KW 3.5%2,651 2,743 2,840 2,939 MAINTENANCE - 1995 2.75%27 27 28 29 30 30 3t 32 -33 1996 2.75%27 28 23 30 uv 3t 32 33 1997 2.75%28 23°30 3 32 33 33 1998 2.75%298 30 31 32 33 34 2004 2.75% TOTAL MAINT NEW UNITS 27 55 85 116 119 123 126 130 133 TOTAL MAINT OLD UNITS 2.75%$0 51 $3 84 86 8?59 60 62 psyqxCOPPER VALLEY ELECTRIC 3/18/94 BASE CASE-ALL DIESEL FILENAMEASGLICHOSLML MEDIUM LOW-MEOIUM FUEL CASE INFLAT FACTOA 2004 2005 2006 2007 2008 2009 2010 2031 2012 2013 2014 2015 'o1 NEW OIESEL COSTS 2016 2017 INTEREST EXPENSE 1995 120 Wi2 104 95 86 76 98 §3 41 28 18 INTEREST EXPENSE 1998 132 124 116 108 99 89 78 67 68 43 29 15 INTEREST EXPENSE 1997 144 137 129 120 412 102 92 81 70 87 a4 30 16 INTEREST EXPENSE 1998 186 149 141 133 125 118 106 95 84 72 s9 46 32 16 INTEREST EXPENSE 2004 235 229 222 218 208 200 192 183 174 164 153 142 130 WW? SUS INT ON NEW UNITS 787 751 V2 671 630 $82 563 4739 424 364 300 233 178 133 DEPRECIATION 1995 132 132 132 132 132 132 132 132 132 132 132 DEPRECIATION 1996 137 137 137 137 137 137 137 137 137 137 137 137 DEPRECIATION 1997 142 142 142 142 142 142 142 142 142 142 142 142 142 DEPRECIATION 19398 147 147 147 147 147 147 147 147 147 147 147 147 147 147 DEPRECIATION 2004 1681 181 181 181 181 181 181 181 181 181 181 181 161 181 SUB OEPREC ON NEW UNITS 739 739 739 739 733 739 739 739 739 739 739 607 470 328 PLANTOPERATOR 2.75%126 129 133 137 140 144 148 162 157 161 165 170 175 179 ADD 1 MAINT CREW 2.75%126 129 133 137 140 144 148 162 187 161 165 170 174 79 ADD 1 MAINT CREW 2.75%126 129 133 137 140 144 148 152 156 161 165 170 174 179 ADD 1 MAINT CREW 2.75%9 °°J 9 °i')i')J °9 6 (+)i) TOTAL MAINT CREW 252 259 266 273 261 289 296 305 313 322 330 340 349 358 CAPITAL COST 2150 KW 3.5%3,613 MAINTENANCE 1995 2.75%34 35 36 ”38 39 40 a1 42 43 a4 46 47 48 1996 2.75%34 35 36 37 38 39 40 ai 42 a4 a5 46 47 48 1997 2.75%34 35 36 37 38 39 ao 42 43 a4 45 46 48 ag 1998 2.75%35 36 37 38 39 40 41 42 43 44 4s 47 aa ag20042.75%36 37 38 39 40 ai 43 a4 48 46 a7 49 50 51 TOTAL MAINT NEW UNITS 473 178 183 188 193 198 204 209 215 224 227 233 240 246 TOTAL MAINT OLD UNITS 2.75%64 66 67 &9 71 73 75 77 79 81 a6 86 68 91 Tovuquxg[COPPER VALLEY ELECTRIC 3/21/94 ALLISON LAKE FILENAME:\SGLICHALLML MEDIUM LOW-MEDIUM FUEL CASE MWH REQUIREMENT SOLOMON GULCH EXISTING DIESELS NEW DIESELS ALLISON LAKE LOSSES TOTAL REG TOTAL LESS SOLOMON FUEL GALLONS FUEL EFFICIENCY FUEL PRICE SOLOMON GULCH RATE OSL FUEL COST LABOR A&E LABOR PRODUCTION ADD 3 OPERATORS ADD MAINTENANCE CREW GOP GENERAL GOP UNITS VDP GENERAL VDP UNITS OTHER DSL INTEREST DSL DEPREC SOLOMON POWER COST ALLISON INTEREST ALLISON DEPRECIATION ALLISON O &M NEW DIESEL BLOG NEW DIESELS O&M NEW DIESELS INTEREST NEW DIESELS DEPREC TOTAL COSTS COST PER KWH/SUPP iNFLAT FACTOR 2.75% 2.76% 2.75% 2.76% SCH SCH 2.75% 2.76% 2.75% 2.75% 2.75% FIXED FIXED 2.78% SCH SCH SCH FOUR ACTUAL ACTUAL ACTUAL BUDGET YEAR 1991 1992 1993 1994 AVG 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 39,634 40,880 52.364 44,925 44,451 49,462 50,549 51,553 51,824 82,097 62,376 52.606 52,606 52,606 62,606 20,765 21,607 20,548 28,777 22,924 31,618 22,846 14,946 6,149 4,113 t+)0 3 0 0 11,300 21,539 31,964 36,635 11,797 12,490 13,213 13,840 14,442 26,715 26,715 26,715 26,715 26,715 (197)(20){202}(204)(205)(324)(308)(289){273)(257) 60,399 62,487 72,912 73,702 67,375 80,883 84,494 87,836 88,733 89,640 90,564 91,503 92,245 92,888 93,506 20,765 21,607 20,548 28,777 22,924 31,421 33,945 36,283 36,909 37,543 38,188 38,897 39,639 40,282 40,900 2,432 2,627 2,516 2,474 2,435 761 806 852 893 932 13 13 14.5 16 15.5 16.5 15.5 18.5 15.5 15.5 0.75 0.771 0.792 0.814 0.836 0.859 0.883 0.907 0.932 0.957 0.064 0.064 0.064 0.066 0.0645 0.066 0.067 0,067 0.068 0.069 0.070 0.071 0.071 0.072 0.073 1,376 1,252 1,176 1,442 1,304 1,824 2,024 1,992 2,013 2,036 654 7 773 832 892 84 65 87 79 79 83 85 88 90 93 95 98 100 103 106 689 750 837 748 756 793 814 837 860 741 761 782 804 826 948 o o i)0 0 °°0 °°Q °°i]° QO 0 Qo 0 °0 °0 0 °0 0 0 0 i) 152 89 214 208 166 2it 217 223 229 235 242 248 255 262 269 109 71 285 184 162 235 241 248 254 58 57 59 60 62 64 75 162 269 141 162 205 2t 216 222 228 235 241 248 255 262 83 288 ag 162 186 126 129 132 136 56 57 59 60 62 64 163 173 38 13 94 30 31.32 33 33 34 35 36 37 38 220 212 205 192 207 179 168 157 147 137 126 119 111 108 98 235 237 244 244 240 244 244 244 244 244 244 244 244 244 244 iy t)o 0 0 te)0 0 i)t+)932 943 964 966 978 3,138 3,110 3,080 3,048 3,015 1,046 1,046 1,046 1,046 1,046 284 292 300 308 317 °0 0 0 Qo °o [)9 0 °ce]°0 °° t)0 0 0 Qo oO 27 67 88 120 124 127 131 134 138 0 0 0 0 0 9 178 359 540 723 701 678 654 628 601 o 0 A)0 0 (2)137 279 426 426 426 426 426 426 578 3,176 3,299 3,444 3,383 3,326 3,929 4,506 4,863 5,282 5.128 9,158 9,218 9,283 9,344 9,558 $0.1529 $0.1627 $0.1676 $0.1176 $0.1451 80.1250 80.1328 $0.1340 -$0.1431 0.1366 30.2398 _$0.2370 30.2342 -$0.2320 30.2337 TOVUQUXACOPPER VALLEY ELECTRIC 3/21/94 ALLISON LAKE FILENAME:\SGL\CHALLML [MEDIUM LOW-MEDIUM FUEL CASE (NFLAT FACTOR 2005 2006 2007 2008 2003 2010 2011 2012 2013 2014 2015 2016 2017 MWH REQUIREMENT SOLOMON GULCH 52,606 52,606 52,606 52,606 §2,606 §2,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606EXISTINGDIESELS00°o o 0 18 37 56 75 95 414 134 NEW DIESELS 15,036 16,629 16,225 16,828 17,437 18,054 18,672 19,297 19,930 20,560 21,195 21,833 22,478 ALLISON LAKE 26,715 26,715 26,716 26,715 26,715 26,715 26,715 26,715 26,715 26,716 26,715 26,715 26,716 LOSSES {242}{226}{2ty)(196)(180)(164)(159)(184)(149)144)(139)(134)4129) TOTAL REQ 94,115 94,724 95,335 95,953 96,578 97,211 97,852 98,501 99,158 99,812 100,472 101,134 101,802 TOTAL LESS SOLOMON 41,509 42,118 42,729 43,347 43,972 44,605 45,246 45,895 46,552 47,206 47,866 48,528 49,196 FUEL GALLONS 970 1,008 1,047 1,086 4,125 1,165 1,206 1,247 1,289 1,331 1,374 1,416 1,459 FUEL EFFICIENCY 16.5 15.5 15.5 16.5 16.5 16.5 16.8 16.5 18.5 15.6 15.8 15.5 16.5 FUEL PRICE 2.75%0.984 1.011 1.039 1.067 1.096 4.127 1.158 1.189 1.222 1.256 1.290 1.326 1.362 SOLOMON GULCH RATE 2.75%0.074 *0.075 0.076 0.077 0.078 0.079 0.080 0.081 0.082 0.084 0.085 0.086 0.087 OSL FUEL COST 954 1,019 1,087 1,159 1,234 1,312 1,396 1,484 1,576 1,672 1,772 4,877 1,987LABORA&E . 2.78%109 112 116 118 121 125 -128 132 135 139 143 147 161 LABOR PRODUCTION 2.75%872 836 920 946 972 998 1,026 1,054 1,083 1,113 1,143 1,175 1,207 ADD 3 OPERATORS SCH 0 °o "0 [')0 o 0 [?]0 °0 ° ADD MAINTENANCE CREW SCH o 0 0 0 °o 0 0 °°0 o 0 Le] GOP GENERAL 2.76%277 284 292 300 308 317 326 336 344 353 363 373 383 GOP UNITS 2.75%66 87 869 7t 73 75 77 79 81 a4 86 aa 91 VDP GENERAL 2.75%269 276 284 292 300 308 316 325 334 343 363 362 372 VOP UNITS 2.75%66 87 69 71 73 75 77 79 81 84 86 88 91 OTHER 2.75%39 ao 42 43 44 45 46 48 49 50 $2 §3 64 DSL INTEREST FIXED 92 85 80 75 70 26 18 3 o 0 oO 0 0 OSL OEPREC .FIXED 244 244 195 °0 [e)0 i)0 t)°°0 SOLOMON POWER COST 990 1,002 1,016 1,028 1,042 1,056 1,070 1,085 1,100 1,116 1,132 1,148 1,165 ALLISON INTEREST 2,979 2.941 2,901 2,859 2,814 2,767 2.716 2,663 2,606 2,846 2,482 2.415 2,343 ALLISON DEPRECIATION 1,046 1,046 1,046 1,046 1,046 1,046 1,046 1,046 1,046 1,046 1,046 1,046 1,046 ALLISON O&M 2.75%325 334 343 363 363 373 383 393 404 415 427 438 450 NEW DIESEL BLDG :9 0 i)°[+][+]0 oO oO 0 0 t)0 NEW DIESELS O&M SCH 142 146 150 154 158 162 167 a7 176 181 186 191 196 NEW DIESELS INTEREST SCH §72 540 507 474 435 395 362 307 269 208 152 96 49 NEW DIESELS DEPREC SCH 578 578 578 $78 578 $78 578 578 578 578 578 aay 299 TOTAL COSTS 9,619 9,679 9,694 9,566 9,630 9,658 9,722 9,782 9,853 9,928 10,000 9,940 9,886 COST PER KWH/SUPP $0.2317 $0.2298 _$0.2269 _$0.2207 $0.2190 80.2165 $0.2149 $0.2131 $0.2117 $0.2103 $0.2089 $0.2048 40.2009 OVNalyx”COPPER VALLEY ELECTRIC 3/21/94 ALLISON LAKE SUPPORTING SCHEDULES FILENAME:\SGLICHALLML [MEDIUM LOW-MEDIUM FUEL CASE INFLAT FACTOR 1992 1993 1994 19956 1996 1997 1998 1999 2000 2001 2002 2003 NEW DIESEL COSTS INTEREST EXPENSE 1996 178 174 169 164 168 152 146 139 INTEREST EXPENSE 1997 185 180 178 169 164 188 151 INTEREST EXPENSE 1998 191 186 181 175 169 163 INTEREST EXPENSE 1999 198 193 187 181 175 SUB INT ON NEW UNITS c)178 359 540 723 701 678 654 628 DEPRECIATION 1996 137 137 137 137 137 137 137 137 DEPRECIATION 1997 142 142 142 142 142 142 142 OEPRECIATION 1998 147 147 147 147.147 147 DEPRECIATION 1999 SUBS DEPREC ON NEW UNITS oO 137 279 426 426 426 426 426 426 PLANTOPERATOR 2.75%91 94 96 99 101 104 107 110 113 116 119 123 ADD 1 MAINT CREW 2.75%91 Qo 0 t')Oo i+] ADD 1 MAINT CREW 2.75%91 °0 t)t+) ADD 1 MAINT CREW 2.75%91 o ]0 TOTAL MAINT CREW 0 [)0 [')t+)()0 i)oO CAPITAL COST 2150 KW 3.5%2.743 2,840 2,939 3,042 MAINTENANCE 1996 2.75%27 28 29 30 3 31 32 33 1997 2.75%28 29 30 31 32 33 33 1998 2.75%29 30 31 32 33 34 1999 2.75%30 31 32 33 34 TOTAL MAINT NEW UNITS [*)27 57 88 120 124 127 131 134 TOTAL MAINT OLD UNITS 2.75%50 §1 §3 54 56 57 §9 60 62 povuqUYx”COPPER VALLEY ELECTRIC ALLISON LAKE FILENAME:\SGLICHALLML MEDIUM LOW-MEDIUM FUEL CASE NEW DIESEL COSTS INTEREST EXPENSE INTEREST EXPENSE INTEREST EXPENSE INTEREST EXPENSE SUB INT ON NEW UNITS DEPRECIATION DEPRECIATION DEPRECIATION DEPRECIATION SUB DEPREC ON NEW UNITS PLANTOPERATOR ADD 1 MAINT CREW AOD 1 MAINT CREW ADO ft MAINT CREW TOTAL MAINT CREW CAPITAL COST 2150 KW MAINTENANCE TOTAL MAINT NEW UNITS TOTAL MAINT OLD UNITS 3/21/94 1996 1997 1998 1999 1996 1997 1998 1999 1996 1997 1998 1999 (NFLAT FACTOR 2.75% 2.75% 2.76% 2.75% 3.5% 2.75% 2.75% 2.75% 2.75% 2.75% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 132 124 116 108 99 89 78 67 §5 43 29 15 144 137 129 120 112 102 92 81 70 87 44 30 16 156 149 141 133 125 115 106 95 84 72 59 46 32 16 169 162 154 146 138 129 119 109 98 87 76 61 48 33 601 §72 540 507 474 438 395 352 307 259 208 152 96 49 137 137 137 137 137 137 137 137 137 137 137 137 142 142 142 142 142 142 142 142 142 142 142 142 142 147 147 147 147 147 147 147 147 147 147 147 147 147 147 152 162 152 152 152 152 152 152 152 162 162 152 152 152 678 678 678 578 678 578 578 §78 678 578 678 578 441 299 126 129 133 137 140 144 148 162 157 161 165 170 175 179 t)is)[*)0 Oo oO Oo °°0 0 o (*)oi)i')0 o °o 0 o °(')te)o 0 0 i]i!)90 Q 0 9 ()o 0 i]i]0 i 9 (9) 0 ()t){+}Oo t)Q 0 (?]i)t)Qo 90 Q 34 35 36 37 38 39 40 41 42 44 45 46 47 48 34 35 36 37 38 39 40 42 43 44 45 46 48 as 35 36 37 38 39 40 41 42 43 44 45 47 438 49 35 36 37 38 39 40 41 42 43 44 46 47 48 50 138 142 146 1650 164 158 162 167 171 176 181 186 191 196 64 66 67 69 71 73 75 77 79 81 84 a6 88 91 JRRBEE SUTTON TO GLENNALLEN 138 KV INTERTIE--POWER COST ANALYSIS--NON-INTEGRATED CAPACITY LEASE OR ECONOMY VS INTEGRATED FIRM ee|2 =JANUARY,21,1994 REVISED 3/21/943>ASSUMPTIONS4INFLATIONADJUSTED 102.75%ANN.PAY. S 80 YEAR,ZERO INT,LOAN $38.0 MILLION 9700,000 @ 35 YEAR,6.00%LOAN 917.1 MILLION $1,183,207 7 TOTAL COST OF LINE $52.1 MILUON 91,883,207 @ POWER COST CUNF 19988 (KWH)*0.035 CAPACITY LEASE OR ECONOMY ENEAGY--INCLUOES 1 MILL KWH FOR WHEELING TO MEA 9 POWER COST FIRM 19988 (KWHI*?90.056 INTEGRATED INTO RAILBELT SYSTEM --INCLUDES 1 MILL KWH FOR WHEELING TO MEA 10 YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2018 2018 2017 12 CASE 1A--CAPACITY LEASE OR NON-FIRM--MEOIUM LOW LOAD--(NOT INTEGRATED} 13 INFL.RATE . 16 SUPPLEMENTAL KWH REQ.36,909,000 37,543,000 38,188.000 38,898,000 39,639,000 40,282,000 40,900,000 41,809,000 42,118,000 42,729,000 43,347,000 43,972,000 44,605,000 45,246,000 45,895.000 46.553.000 47.207.000 47.885.000 48,529,000 49,197,000 4S OEPRECIATION $1,043,088 $1,043.088 $1,043,088 $1,043,088 $1,043,068 $1,043,088 $1,043,088 91,043,088 $1,043,088 $1,043,088 $1,043,088 91,043.088 $1,043,088 $1,043.088 $1,043,088 $1,043,088 $1,043,088 $1.043,088 $1,043,088 $1,043,088 16 ANNUAL INTEREST 91,029,265 $1,020,029 61,010,236 $999,860 $986,859 $977,198 $964,838 $961,738 $937,648 $923,126 $907,521 9690,980 $873,446 $854,061 $635.160 $814,277 $792,142 $768,678 $743,806 727442! 17 SUBTOTAL DEBT SERVICE 0%$2,072,353 $2,063.117 $2,053,326 $2,042,948 $2,031,947 92.020.286 $2.007,928 $1,994,824 $1,980,936 $1,966,214 $1,950,609 $1,934,068 $1,916,534 $1,697,949 91.678.248 $1,857,368 $1.035.230 $1.8 $1,786,894 =$1,770,53018OEBTSERVICECOSTKWH0.0561 0.0550 0.0638 0.0525 0.0813 0.0502 0.0491 0.0481 0.0470 0.0460 0.0450 0.0440 0.0430 0.0419 0.0409 0.0399 0.0383 0.0368 0.0360 19 LINE O&M EXPENSE 2.75%$263,412 9270.056 $278,099 9285.747 9$293.608 $301,679 $309,975 $318,499 $327,258 $336,258 $345,505 $355,006 $364,769 $374,600 93865,107 $398,697 9406,579 $417,760 $429,248 $441,053 20 STANDBY LABOR OIESEL 2.78%$229,054 $235,353 $241,825 $246,475 $255,308 $262,329 $269,544 $276,956 $284,572 $292,398 $300,439 $308,701 $317,190 $325,913 $334,876 $344,085 $353,547.$363,270 $373,259 $363,524 21)OLESEL PLANT O&M 2.75%9994,527 $117,676 $120,913 $124,238 $127,654 $131,168 $134,772 9138,478 $142,286 $146,199 $150,219 $454,350 $156,595 $162,956 $167,438 $172,042 $176,774 $161,636 $186,630 9191,762 22°=SUBTOTAL LINE OP.COST $2,679,348 $2,686.802 $2,694,163 $2,701,408 $2,708,514 $2,715,459 92,722,218 $2,728,757 $2,735,052 $2,741,068 92,746,772 $2,752,125 $2,757,086 $2,761.61 $2,765,668 $2,769,189 $2,772,129 $2,774,430 $2,776,031 $2,786,869 23 «LINE OP.COST KWH 0.0726 0.0716 0.0708 0.0694 0.0683 0.0674 0.08666 0.0657 0.0649 0.0642 09,0634 0.0626 0.0618 0.0610 0.0603 0.0995 0.0587 0.0580 0.0572 0.0566 24 RESIDUAL INTEREST DIESEL on $147,000 $137,000 $128,000 $119,000 $111,000 $105,000 $98,000 $92,000 $85,000 $60,000 $75,000 $70,000 $26,000 $18,000 $3,000 28 AES.DEPRECIATION DIESEL on $244,000 $244,000 $244,000 $244,000 $244,000 9244,000 $244,000 $244,000 $244,000 $195.00026SUB-TOTAL COST LESS P.C.$3,070,346 $3,067,802 $3,086,163 93,084,408 $3,083,514 $3.084.459 $3,064,216 $3,064,757 $3,064,052 $3,016,068 $2,821,772 $2,822,128 $2,783.088 92,779,618 62,760.668 $2,769,189 $2,772,129 $2,774,430 92,776,031 =$2.786.86927°COST,LESS POWER COST KWH 0.0832 0.0817 0.0803 0.0788 0.0773 0.0761 0.0749 0.0738 0.0727 0.0706 0.0651 0.0642 0.0824 0.0614 0.0603 0.0595 0.0587 0.0560 0.0572 0.0566 28 POWER COST 2.75%=$1,291.815 $1,350,140 $1,373,336 $1,398,869 $1,425.518 91,448,641 $1,470,866 $1,492,767 $1,514,669 $1,536,642 $1,556,666 91.581.343 $1,604,107 61,627,159 $1,650,499 $1,674,162 $1,697,682 $1,721,345 $1,745,224 $1,769,247TOTALCOSTOFPOWER94,362,161 $4,417,942 94,439,499 $4,463,277 $4,808,738 $4,513,100 $4,535.082 $4,557,525 $4,578,721 $4.552.710 $4,380,638 94,403,469 $4,387,195 $4,406,778 94,419,167 94,443,352 $4,469,611 94,495,775 $4,521,256 $4,556,116 COST OF POWER KWH 0.1182 0.1977 0.1163 0.1147 0.1213 0.1120 0.1109 0.0974 0.0939 0.0932 0.0926)0.1098 0.1087 0.1065 0.1011 0.1001 0.0984 0.0963 0.0954 0.0947 32 CASE 2A--FIRM--MEDIUM LOW LOAD--(INTEGRATED) 3. 34 COST OF SUPP.POWER 2.75%$2,066,904 $2,160,224 $2,197,338 $2,238,191 92,280,828 $2,317,626 $2,353,386 $2,388,428 $2,423,470 $2,458,627 $2,494,186 $2,530.149 $2.566.572 92,603.458 $2,640,796 $2.678.660 $2.716.291 $2,754,182 92.792.359 $2,830,795 3S STANDBY LAGOR DIESEL 2.75%$229,084 $235,353 6241.828 92468,478 $255,308 $262,329 $269,544 $276,956 $264,572 $292,398 $300,439 $308,701 $317,190 $326,913 $334,876 $344,088 $353,947 $363,270 $373,259 $383,524 36 DIESEL PLANT O4M 2.75%6114,527 $117,676 $120.913 $124,238 $427,684 $131,165 9034,772 $438,478 $442,268 $146,199 $180,219 $154,350 $158,595 $182.986 $167,438 $172.042 $176,774 $181,638 $186,630 $191,762 37 RESIDUAL INTEREST OIESEL om $147,000 $137,000 9128,000 $149,000 $111,000 $105,000 $98,000 $92,000 $85,000 980.000 $75,000 $70,000 $26,000 918,000 93,000 38 AES.DEPRECIATION DIESEL o%$244,000 $244,000 $244,000 ©$244,000 $244,000 $244,000 9244,000 $244,000 $244,000 $498,00039«TOTAL POWER COST $2,801,485 $2,894,254 $2,932,075 $2,973,904 $3,018,791 $3,060,320 $3,099,701 $3,139,862 $3,179,328 $3,172,224 $3,019,845 $3,063,200 93,068,357 83,110,324 $3,146,112 $3,194,787 93,246,611 $3,299,086 $3,352,248 $3,408,082 40 TOTAL COST KWH 0.0759 0.0771 0.0768 0.0765 0.0762 0.0760 0.0758 0.0756 0.0758 0.0742 0.0697 0.0697 0.0686 0.0687 0.0686 0.0886 0.0688 0.0689 0.0691 0.06972! °°ANNUAL SAVINGS $1,560,676 TOTAL SAVINGS FOR STUDY PERIOD 927,833,746 *BASED ON ML&P MID CASE +1 MILL FOR WHEELING (ML&P)LETTER FEBRARY 1994..°°BASED ON_INFORMATION PROVIDED BY CHUGACH (DECEMBER 1993)°*SAVINGS COMPARING CASE 1 YO CASE 2. $1,823,689 $1,507,423 $1,489,373 $1,789,948 $1,452,780 $1,435,381 $1,417,663 $1.399.393 $1,360,487 $1,360,794 $1,340,268 31,318,838 $1,296,453 $1,273,055 $1,248,565 $1,223,200 $1,196,719 $1,169,008 $1,150,034 Sy Es S a COPPER VALLEY ELECTRIC DIESEL EXPANSION CASE ASSUMPTIONS General rate of inflation 2.75%. Add three operators in 1999. Add three-man maintenance crew.One each 1999,2000,and 2001 for meduim-high case.(add two for medium-low) New diesel cost $1,112 in 1992 dollars,interest 6.5%,20 year life,no salvage for depreciation. New diesel O&M 1%of capital cost. Load forecast assumes Beck mwh.© _Fuel efficiency: 1995-96 13 1997 14.5 1998 15 1999-2017.15.5 Glennallen and Valdez maintenance on units set at $50,000/year each plant.Indexed to inflation.mt Assume diesel units are added in 1995,1996,1997,1998,and 2004. Exhibit A8 10. 11. COPPER VALLEY ELECTRIC ALLISON LAKE ASSUMPTIONS Use Beck load forecast assumptions as to resource output. General rate of inflation 2.75%. Inflate Solomon Gulch power cost at rate of inflation for O&M component only. .Assume reduction of 1.5 operators in 1999. Assume diesel units added in 1996,1997,1998,and 1999. Assume Beck cost of power analysis as to project cost. Assume 50-year life for depreciation. Assume 6%,35-year loan (see attached amortization schedule). Assume maintenance on new diesels at 1%of cost. New diesel cost $1,112kw in 1992 dollars,interest 6.5%,20-year life,no salvage for depreciation. Glennallen and Valdez maintenance on units set at $50,000/year each plant.Indexed to inflation. Exhibit A9 COPPER VALLEY ELECTRIC INTERTIE ASSUMPTIONS Project Cost $52.1 million per Beck cost of power analysis. Project Finance State loan 50-year,0%,$35 million REA loan 35-year,6%,$17.1 million Cost of Power Nonfirm 3.5¢in 1998 Firm 5.6¢in 1998 General rate of inflation 2.75% Assume two standby diesel operators Assume diesel O&M $100,000/year in 1995 | 'Assume 50-year life,no salvage for depreciation Assume intertie O&M per Beck study Exhibit A10 COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE DEPRECIATION . SUTTON/GLENNALLEN LINE SUPP 35,000,000 17,154,423 52,154,423 50 35 50 700,000 490,126 1,043,088 PRINCIPAL 17,154,423 INTEREST RATE 6.0% TERM , 35 PAYMENT (1,183,206.75) YEAR PAYMENT INTEREST PRINCIPAL BALANCE 17,154,423 1 1,183,207 1,029,265 153,941 17,000,482 2 1,183,207 1,020,029 163,178 16,837,304 3 1,183,207 1,010,238 172,969 16,664,335 4 1,183,207 999,860 183,347 16,480,989 5 1,183,207 988,859 194,347 16,286,641 6 1,183,207 977,198 206,008 16,080,633 7 1,183,207 964,838 218,369 15,862,264 8 1,183,207 951,736 231,471 15,630,793 9 1,183,207 937,848 245,359 15,385,434 10 1,183,207 §§--923,126 260,081 15,125,353 11 1,183,207 907,521 275,686 14,849,668 12 1,183,207 "890,980 292,227 14,557,441 13 1,183,207 873,446 309,760 14,247,681 14 1,183,207 .854,861 328,346 13,919,335 15 1,183,207 835,160 348,047 13,571,288 16 1,183,207 814,277 368,929 13,202,359 17 1,183,207 792,142 391,065 12,811,294 18 1,183,207 768,678 414,529 12,396,764 19 1,183,207 743,806 439,401 11,957,364 20 1,183,207 717,442 465,765 11,491,599 21 1,183,207 689,496 493,711 10,997,888 22 1,183,207 659,873 §23,333 10,474,554 23 1,183,207 628,473 554,733 9,919,821 24 1,183,207 595,189 588,018 9,331,803. 25 1,183,207 559,908 623,299 8,708,505 26 1,183,207 522,510 660,696 8,047,808 27 1,183,207 482,868 700,338 7,347,470 28 1,183,207 440,848 742,359 6,605,111 29 1,183,207 396,307 786,900 5,818,211 30 1,183,207 349,093 834,114 4,984,097 31 1,183,207 299,046 884,161 4,099,936 32 1,183,207 245,996 937,211 3,162,726 33 1,183,207 189,764 993,443 2,169,283 34 1,183,207 130,157 1,053,050 1,116,233 35 1,183,207 66,974 1,116,233 0 Exhibit All COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE ALLISON LAKE PRINCIPAL 52,296,000 INTEREST RATE 6.0% TERM 35 PAYMENT (3,607,056.93) DEPRECIATION 1,045,920 50 YEARS INTEREST YEAR PAYMENT PRINCIPAL 1 3,607,057 3,137,760 469,297 2 3,607,057 3,109,602 497,455 3 3,607,057 3,079,755 527,302 4 3,607,057 3,048,117 558,940 5 3,607,057 3,014,580 392,477 6 3,607,057 2,979,032 628,025 7 3,607,057 2,941,350 665,707 8 3,607,057 2,901,408 705,649 9 3,607,057 2,859,069 747,988 | 10 3,607,057 2,814,190 792,867 It 3,607,057 2,766,618 840,439 12 -3,607,057 2,716,191 890,866 13 3,607,057 2,662,739 -944,318 14 3,607,057 2,606,080 1,000,977 15 3,607,057 2,546,022 1,061,035 16 3,607,057 2,482,360 1,124,697 17 3,607,057 2,414,878 1,192,179 18 3,607,057 2,343,347 1,263,710 19 3,607,057 2,267,524 1,339,533 20 3,607,057 ==.2,187,152 1,419,905 21 3,607,057 2,101,958 1,505,099 22 3,607,057 2,011,652 1,595,405 23 3,607,057 1,915,928 1,691,129 24 3,607,057 '1,814,460 1,792,597 25 3,607,057 1,706,904 1,900,153 26 3,607,057 1,592,895 2,014,162 27 3,607,057 1,472,045 2,135,011 28 3,607,057 1,343,945 2,263,112 29 3,607,057 1,208,158 2,398,899 30 3,607,057 1,064,224 2,542,833 31 3,607,057 911,654 2,695,403 32 3,607,057 749,930 2,857,127 33 3,607,057 578,502 3,028,555 34 3,607,057 396,789 3,210,268 35 3,607,057 204,173 3,402,884 BALANCE 52,296,000 51,826,703 51,329,248 50,801,946 50,243,006 49,650,530 49,022,504 48,356,798 47,651,149 46,903,161 46,110,293 45,269,854 44,378,988 .43,434,671 42,433,694 41,372,659 40,247,961 39,055,782 37,792,072 36,452,540 35,032,635 33,527,536 31,932,131 30,241,002 28,448,406 26,548,253 24,534,091 22,399,080 20,135,968 17,737,069 15,194,236 12,498,833 9,641,706 6,613,152 3,402,884 0 Exhibit A12 eVWqNMXACOPPER VALLEY ELECTRIC DIESEL CASE ASSUMPTIONS 1992 PRICE PER KW INFLATE AT 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 1,112 3.5% 1,151 1,191 1,233 1,276 1,321 1,367 1,415 1,464 1,516 1,569 1,623 1,680 1,739 1,112 5.0% 1,168 1,226 1,287 1,352 1,419 1,490 1,565 *1,643 1,725 1,811 1,902 1,997 2,097 COST FOR 2150 KW 2,474,478 2,510,340 2,561,085 2,635,857 2,650,723 2,767,650 2,743,498 2,906,032 2,839,520 3,051,334 2,938,904 3,203,901 3,041,765 -3,364,096 3,148,227 3,532,300 3,258,415 3,708,915 3,372,460 3,894,361 3,490,496 4,089,079 3,612,663 4,293,533 3,739,106 4,508,210 DeryvqryxgCOPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE YEAR ACQUIRED PRINCIPAL | INTEREST RATE TERM PAYMENT ANN DEPREC COST ESCALATOR YEAR PAYMENT 1 240,396 2 240,396 3 240,396 4 240,396 5 240,396 6 240,396 7 240,396 8 240,396 9 240,396 10 240,396 11 240,396 12 240,396 13 240,396 14 240,396 15 240,396 16 240,396 17 240,396 18 240,396 19 240,396 20 240,396 1995 2,648,800 6.5% 20 (240,395.54) 132,440 3% INTEREST 172,172 167,737 163,015 157,985 152,628 146,923 140,848 134,377 127,486 120,147 112,331 104,006 95,141 85,700 75,644 64,935 53,531 41,384 28,449 14,672 PRINCIPAL 68,224 72,658 77,381 82,411 87,767 93,472 99,548 106,018 112,910 120,249 128,065 136,389 145,254 154,696 164,751 175,460 186,865 199,011 211,947 225,724 BALANCE 2,648,800 2,580,576 2,507,918 2,430,538 2,348,127 2,260,360 2,166,887 - 2,067,340 1,961,321 - 1,848,412 1,728,163 1,600,098 1,463,709 1,318,454 1,163,758 999,007 823,547 636,682 437,670 225,724 0 CLVNQX”COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE YEAR ACQUIRED PRINCIPAL INTEREST RATE TERM PAYMENT ANN DEPREC COST ESCALATOR YEAR PAYMENT 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 248,981 -oOUWOONNUNPWN-_--248,981 248,981 248,981eeeeeeeeeeeewoonNUN&WWbNOo(248,981.10) 248,981. .1996 | 2,743,400 6.5% 20 137,170 3% INTEREST 178,321 173,728 168,837 163,627 158,079 152,171 145,878 139,176 132,039 124,438 116,342 107,721 98,539 88,760 78,346 67,255 55,442 42,862 29,465 15,196 PRINCIPAL 70,660 75,253 80,144 85,354 90,902 96,810 103,103 109,805 116,942 124,543 132,639 141,260 150,442 160,221 170,635 181,727 193,539 206,119 219,516 233,785 BALANCE. 2,743,400 2,672,740 2,597,487 2,517,342 2,431,989 2,341,087 2,244,276 2,141,173 2,031,368 1,914,426 1,789,883 1,657,244 1,515,984 1,365,542 1,205,321 1,034,686 852,959 659,420 453,302 233,785 0 CVIUqMXACOPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE YEAR ACQUIRED PRINCIPAL INTEREST RATE TERM PAYMENT ANN DEPREC COST ESCALATOR YEAR PAYMENT 1 257,762 2 257,762 3 257,162 4 257,162 5 257,762 6 257,762 7 257,762 8 257,762 9 257,762 10 257,162 11 257,762 12 257,762 13 257,762 14 257,762 15 257,762 16 257,762 17 257,762 18 257,762 19 257,762 20 257,162 1997 2,840,150 6.5% 20 (257,761.78) "142,008 3% INTEREST 184,610 179,855 174,791 169,398 163,654 157,537 151,023 144,085 136,695 128,826 120,445 111,520 102,014 91,890 81,109 69,626 57,398 44,374 30,504 15,732 PRINCIPAL "73,152 77,907 82,971 88,364 94,108 100,225 106,739 113,677 121,066 128,936 137,316 146,242 155,748 165,871 176,653 188,135 200,364 213,388 227,258 242,030 BALANCE © 2,840,150. 2,766,998 2,689,091 2,606,120 2,517,756 2,423,649 2,323,424 2,216,685 2,103,008 1,981,941 1,853,006 1,715,689 1,569,447 1,413,700 1,247,828 - -1,071,175 883,040 682,676 469,288 242,030 0 PTVNqYXACOPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE YEAR ACQUIRED PRINCIPAL INTEREST RATE TERM PAYMENT ANN DEPREC COST ESCALATOR YEAR PAYMENT I 266,738 2 266,738 3 266,738 4 266,738 5 266,738 6 266,738 7 266,738 8 266,738 9 266,738 10 266,738 11 266,738 412 266,738 13 266,738 14 266,738 15 266,738 16 266,738 17 266,738 18 266,738 19 266,738 20 266,738 1998 2,939,050 6.5% 20 (266,737.58) 146,953 3% INTEREST 191,038 186,118 180,878 175,297 169,353 163,023 156,281 149,102 141,456 133,312 124,640 115,403 105,566 95,090 83,933 72,051 59,396 45,919 31,566 16,280 PRINCIPAL 75,699 80,620 85,860 91,441 97,385 103,715 110,456 117,636 125,282 133,425 142,098 151,334 161,171 171,647 182,804 194,687 207,341 220,818 235,172 250,458 BALANCE 2,939,050 2,863,351 2,782,731 2,696,871 2,605,430 2,508,045 2,404,331 2,293,874 2,176,239 2,050,957 1,917,531 1,775,433 1,624,099 1,462,928 1,291,280 1,108,476 913,789 706,448 485,629 250,458 0 SrlNqTyX”COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE YEAR ACQUIRED PRINCIPAL INTEREST RATE TERM PAYMENT ANN DEPREC COST ESCALATOR YEAR PAYMENT 1 327,812 2 327,812 3 327,812 4 327,812 5 327,812 6 327,812 7 327,812 8 327,812 9 327,812 10 327,812 1 327,812 12 327,812 13 327,812 14 327,812 15 327,812 16 327,812 17 327,812 18 327,812 19 327,812 20 327,812 2004 3,612,000 6.5% 20 (327,812.10) 180,600 3% INTEREST 234,780 228,733 222,293 215,434 208,129 200,350 192,065 183,241 173,844 163,836 -153,178 141,827 129,738 116,863 103,151 -88,548 72,996 56,433 38,794 20,007 PRINCIPAL 93,032 99,079 105,519 112,378 119,683 127,462 135,747 144,571 153,968 163,976 174,634 185,985 198,074 210,949 224,661 239,264 254,816 271,379 289,019 307,805 BALANCE 3,612,000 3,518,968 3,419,889 3,314,369 3,201,991 3,082,309 2,954,847 2,819,100 2,674,529 2,520,561 2,356,586 2,181,951 1,995,966 1,797,892 1,586,943 1,362,282 1,123,018 868,202 596,823 307,805 0 1993 1994 1995 1996 .1997 2004 COPPER VALLEY ELECTRIC LOAD FORECAST RESULTS NUMBER OF SERVICES BECK CVEA CVEA MED LOW MED HIGH HIGH PRS ACTUAL 2,912 2,912 2,913 2,893 2,943 2,959 2,959 2,986 2,957 3,017 3,017 3,071 3,030 3,076 3,076 3,157 3,112 PETRO STAR DEMAND (KW); BECK CVEA CVEA MED LOW MED HIGH HIGH PRS ACTUAL 1,600 1,600:1,600 2,375 1,800 1,900 1,900 1,900 2,375 2,400 2,400 2,400 2,375 2,700 2,700 2,700 2,375 3,000 3,000 3,000 2,375 3,000 5,500 5,500 2,375 Exhibit Bl 3000- 25001 | 2000- 1500 1000- 500- Kilowatt Hour Sales_\\ --) Soo<5|----}:SS - =z.=ag|\ fe,]©o- t t =][=] Q °° fo)oS=)°ooOoO o,cUmUCODWU™C-CD o86oOoOoo wo nee nes eee Reena | ormUCUCOTOFlCDSC acast oO oO Oo oO2.2.2.2.[eo] lo) fo] Q Oo oO oO oO oSS 8o6 oO o Oo o wt oN - Exhibit B2.1 iles of Distribution Line g 80,000 0 0 0 1 4 ,000 70,00 ,000 omposition of Generation 00 |Le60,000,000 iesel f|IT '.LI ul aut Lee wee |'Lauer)''Ly +U .T Fe v F 6 6 8 be bees MOOKNOMTMONRMADAMDOKNOTMNOMDOAOOIKNOTMNOMADADOTNANODODDOOWDOWODOORRRAEREREREAERERDODDDDDDDDODNBWD|ODDDHBDAADMOMNAMIOIAIAIAMRAAAAAGAARMAAAARWMAAMAADMWAAVADADDrereerrereeeeeewereeKTreeTreeeeSTTSESESHSESESKSSKSSS +SENT BY:3-14-84;|S 1SPM5 CHUGACH ELECTRIC-TELEX #907 622 5586;#2/3 CHUGACH ELECT RIC |ASSOCIATION,INC. DAVID i.HIGHERS General Manager March 14,1994 Mr.Clayton Hurless Gencral ManagerCopperValleyElectric Association,Inc. P.O.Box 45 Glernallen,AK 99588-0045 Subject:Wholesale Power Provision/CVEA Intertie Dear Clayton: Chugach has previously provided the conceptual framework for provision of wholesale power to Copper Valley Electric Association.Tom Lovas,Chugach's Manager of Planning and Rates made an oral presentation of the concepts to the CVEA Board at the December 3,1993 special board mecting in Valdez.The purpose of this letter is two-fold:1)io indicate our continuing interest in working with CVEA to develop a mutually beneticial power supply arrangement;and,2)to affirm the cost estimates associated with the concepts discussed at that meeting. Chugach is committedto providing cost-effective wholesale and retail energy today and into the future.We wish to be considered a resource to CVEA,and are prepared to assist CVEA in securing long-term power supplies.In that vein,we have submitted formal comments on the draft CVEA Intertie Feasibility Study that support the development of the transmission line accessing Railbelt power supplies and we stand ready to provide additional assistance at your request.The memorandum of understanding we previously provided to you will support the dedication of Chugach's resources toward the development of an appropriate arrangement. As we indicated in December,our preference is for a firm power sale.A firm power arrangement provides the assurance an adequate and continuous supply for CVEA members.Further,it would provide 2 basis for development of future ioads,such as expansion to serve the Alyeska terminal. Finally,it would provide security for Chugach investment in the generation and transmission facilities necessary 10 serve CVEA. Preliminary analysis completed by Chugach staff indicates that CVEA's overall cost of power could potentially be reduced significantly by entering into a net requirements power supply arrangemen: with Chugach Net requirements means provision of all power required in excess of that produced by Solomon Gulch which is currently purchased directly by CVEA,Under a net requirements arrangement,Chugach could participate in the construction of the CVEA intertie in such a way that the costs of the intertie would be included in the generation and transmission cost pocl of Clnigach. S604 Minnesota Drive »RO,Box 196300 ©Anchorage,Alaska 99519-6390 Phone 907-563-7494 @ FAX 907-562-0027 .SENT BY:3-14-94 :3:20PM; CHUGACH ELECTRIC-TELEX #907 622 5586:#3/3 Mr.Clayton Hurless .March 14,1904 Wholesale Power Provision/CVEA Intertia Page 2 The initial cost of such net requirememts power delivered to the Pump Station 11 substation,with an intertie construction cost of $40 million,was estimated at approximately 5.4 ¢/kWh beginning in 1996.This assumes that the total cost cf the CVEA intertie (ie.,state loan,any additional Gnancing and operation and maintenance expenses)would be included in Chugach's generation and transmission costs and allocated among all Chugach firm power customers.If the construction cost is increased to the RW.Beck estimate of $52 million,the cost of power under that type of afrangement would increase to around 5.5 ¢/<Wh in 1996.With firm,net requirements service, CVEA will,of course,be eligible for capital credits in the same fashion as other wholesale customers. Under the net requirements arrangement with Chugach participating in the interties in that fashion, we estimate that the break-even point for existing Chugach customers would be between 4 and 6 years following the completion of the line.We do not consider that period to be unreasonable for a power supply arrangement that could extend,theoretically,for the economic life of the transmission line. Chugach could,alternatively,provide net requirements for CVEA without pooling the cost of the line,delivered to O'Neill,at a rate on the order of 5.1 ¢/cWh in 1996,In this alternative,CVEA would shoulder the entire burden of tho intertie costs. However,if CVEA were to shoulder the entire burden of the intertie costs,CVEA would presumably look to non-assured,interruptible power delivered to O'Neill substation at a lower cost of around 3.5 ¢/kWh (in 1996).We are not particularly interested in providing non-firm service.Furthermore, our esumates indicated that CVEA would see much greater potential interconnection benefits from net requirements and pooled transmission costs than from ron-firm service.In the event of interruptible power provision,we would be unable to obligate our system to CVEA,and there wouldbenoguaranteeofpowerdeliveries.Non-assured supplies or limited service obligations on the partofChugach(or any other railbelt utility)would likely constrain CVEA's ability to negotiate for the Alveska terminal load or,perhaps,other potential and significant sales opportunities. The estimates in this letter are projected rates under alternative concepts for supplying power toCVEA.Before we formally offer to contract we would like to discuss these and any other conceptsandmethodologiesindetail.Of course,approval of the Chugach board and the APUC will berequired,T trust this information is helpful to your consideration of a power supply arrangement.Please let me know if amy other information would assist you in considering our proposedmemorandumofunderstanding.We seek to be CVEA's supplier of choice,and support your effortstasecurelow-cost power for your members. Sincerely, CHUGACH ELECTRIC ASSOCIATION,INC. ---pan |-General Manager 240 APUC No._8 2ist Revision Sheec No.99 RESSIVESon[) Cancelling | Noy 131993 "htie Utllities Commiesie- CHUGACH ELECTRIC ASSOCIATION.INC. SENT BY:3-2-94 3 4:32PM; CHUGACH BLECTRIC-TELEX #907 822 5586;#3/3 SALES FOR RESALE Available to either "All fower Requirements"or "Partial Requirements*wholesale customers wno have long-term specialcontractswithChugachwhichhaveseenapprovedbytheAPUC. Available frem Chugacn's integrated transmission system at various poinmta of delivery. Monrhiy 23res Custemer Charges:$159.90 per Meter Energy Charge:" . -, AEGET d/b/a Homer Eleczcrie¢Assoc.,Inc.$0.02196 ver WhAllCtherWholesaleCustomers$0.01174 ver kWh beattDemand Charge: AEGST d/b/a Matanuska Zlectric Assec.,Inc,$16.65 per kw 1AEG&S&T d/b/a Homer Slectric Asscc.,Ine.$10.60 'per kW z= City of Seward $12.40 perkW ¢f Premium Demand Charge:AEGET d/b/a Homer Eleccric Assoc.,Inc.$12.98 per kW f Billing Demand:For "Ali Requirements"consumers,the billing cemand snall ce che maximum 15-minute integrared demand in the billine month.For "Partial Requiremants"consumers,the monthly billing demansa wilt be tha demand ievel specified in the consumer's contract with Chugach.The premium demand charge will be applied ts each kW of peak demand in exceas of the contract capacity,if Chugach supplies the power to meat the excess demand. Power Factor:The custcmer wiil make a reasonable effort to maintain umity power factor.Demand charges will be adjusted so correct for average power factors leas than 90%.Such adjustments will be nade by increasing che measured demand 1%for each 1%by which the average power factor is less than 90%Lagging. Fuel and Purchased Power Cost Adjustment:In acccrdance with Tariff Sheet Nos.30 -95,a suxrcharce or credit will be applied to each billing for service rendered under this schedule to reflect increases or decreases in fuel and turchased power expenses.aEffectiva:01/01/94TariffAdviceNo.151-8 APUC No._3 withRevision.--ss-Sheet No.__94 3-2-34 >4:31PM Canceliing 26th Revision Sheet No, CHUGACH ELECTRIC ASSOCIATION,INC. CHUGACH ELECTRIC#TELEX #907 822 5586:#2/3 RECEIVED NOV 15 1993 Stata af AlaskaSubticUtititiesCommission to :@.2.- FCEL AND PURCHASED POWER COST ADJUSTMENT FACTOR Predicted costs for the quarter beginning January i,1994: .' Calculation of : Predicted Costs : Estimaced Cost All Classes Saures Quantities Per Unit Except HEA HEA Only ai Aeluga Gac -Hers 4,298,132 $0.7833 $3,936,754 $3,836,724 bj Bernice Lake Gas -Mcf's 30,295 32.5900 $47,873 $47,873 .Cc)Intermatzonal Gas -Mcef-s 327,367 $2.2209 $82,555 $82,955 : dé}Purch Power-Eklutna -Mwh 24,999 =$27,0000 =$424,983 $424,983;@;Purch Power-3radley -MWh 5,486 ---$1,568,776 --- , f) pureh Power -ANLP -wh 3 $0.0000 $0 so; gi Fuel cil $0 $0 |a}Oeker Durchaces §6 Foto): i:Alaska Intertie Expense $12,000 $12,900 an wheeiing Revenue credit ($120,000:($120,600) K>} eonomy Margans Crediz ($315,210)($319,210); 2.Precicted Total fuel &purchased Fewer Costs $5,534,132 $3.965.355 a.Less:HEA Assigned Tests {1 it!$836,434 aes 2.Predicted Fuei &Purchased Power Costs $4,697,697 $3,965,355: 42.Predicted MWh Generation «&Purchases S41,931.i 541,931.21 ? : a.Lesa Puren Power -Bradley Lake soe 55,886.4 b&b.Less HEA at Generation 102,524.06 --- 5.Net 2redicted MWh Generation &Purchases 439,407.0 486.044.7 é.Pradicted Cost/MWh at Generator §10.€9099 $8.15842 Retail MEA/SES ZEA 7.Projected Balance:January 1,1994 4($324,572}($161,234)($140,261) 8.Bredicced Cost/MWh act Generator $i0.6309S $10.69099 $8.15842 9.Bredicted Lime Loss Factor 5.340%5.219%5.219% 19.Predicted Cost/MWh Sola 944-264092 Dab SAO FO 96.58429 ©1.Predicted MWh Sales 271,216.2 1644,459.1 97,438.7.|12.Predicted Fuel &Purch.Power Costs SI,Ubd,415 9l,o00,0L4 30a0,254 13.Predicted MWh Sales 271,216.2 144,459.1 $7,438.7 14.Base Fuel Cost/mwh $é.50498 $6.18332 $6.18332 15.Base Rate Fuel Cost Recovery Si,405,400 SOIS,a07 9602,455 16.Fuel Costs te be Recovered $965,587 $570,543 $33,678 17.?redicted Mm sales 271,216.2 144,459.1 97,438.7 28.Fuel Adjustment Factor/kwh $9.00356 o0.UGI95 30.000396 Tariff Advice No.=59-8 'Effective:01/01/94 i fa eee Title: Association,Ine. a Alasks 99519-6300 General Manager ™. COPPER VALLEY ELECTRIC ASSOCIATION,INC. P.O.BOX 45 §GLENNALLEN,ALASKA 99588-0045 Glennallen _(907)822-3211 Valdez .(907)835-4301 Telefax #(907)822-5586 RESE IVED APR 01 1994 March 29,1994 | DIVISION OF ENERGY/DCRA Mr.Herv Hensley Division of Energy Department of Community &Regional Affairs 333 West 4th Avenue,Suite 220 Anchorage,Alaska 99501-2341 Dear Herv: Enclosed are the corrected spreadsheets on the cost comparisons of the resource options I delivered on Friday.The inflation rate on the cost of purchase power was erroneously calculated and has been corrected on the enclosed sheets. Sorry for any inconvenience this error may have caused.Give me a call if you have any questions.) Yours truly, Clayton Hurless General Manager c:\wp\cdh\94-050.jw SERVING MEMBER-OWNERS IN THE COPPER RIVER BASIN AND VALDEZ Revised table from page 2 of March 22,1994,letter as a result of changed resource outputs. BECK |CVEA BECK |CVEAyEAR'|2000 |2000 2010 |2010 Diesel :12.6 14.2 18.5 14.5 Allison Lake 18.8 20.6 19.9 17.2 Intertie (nonfirm)10.3 9.1 Intertie (firm)10.2 {7.5 12.6 8.5 MEDIUM LOW see PE Diesel 12.9 }16.1 19.6 {17.4 Allison Lake 20.6 24.0 19.6 21.6 Intertie (nonfirm)|17 ALI Intertie (firm)11.2:78 ||13.3 i 8.9 C:\WPDOCS\CDH\REVTABLE (aay)TYmqiuxgSUMCOMP.XLS Tan =oo y a FILE:SUMCOMP.MARCH 28,1994 ee:SUMMARY OF COST COMPARISONS OF ALTERNATIVE POWER SUPPLY OPTIONSMEDIUMHIGHLOAD-MEDIUM FUEL 20092YEAR19981999200020012002200320042005200620072008 2010 2011 2012 2013 2014 2016 2016 2017 3.SUPPLEMENTARY KWH REQUIRED 38,999 42,799 46,574 $0,386 54,000 57,516 61,012 61,622 62,230 62,642 63,459 64,084 64,717 65,359 66,007 66.665 67,317 67,972 68.631 69,295 5 UNIT COST OF POWER---ALL VALUES EXPRESSED IN LINES 6,7,8 &9 ARE IN $KWH 6 DIESEL EXP.COST OF POWER 40.1496 $0.1450 $0.1420 $0.1399 #0.1366 60.1341 40.1395 90.1410 $0.1425 $0.1433 $0.1419 $0.1436 $0.1451 90,1464 =0.1481 $0.1499 =$0.1519 $0.1520 $0.1523 80.15287ALLISONLAKEPOWERCOST0.1383 =$0.1264 80.2064 $0.1957 $0.1872 $0.1802 $0.1768 $0.1766 $0.1764 90.1755 $0.1724 30.1723 $0.1716 $0.1716 $0.1714 $0.1771 80.1715 $0.1716 $0.1697 $0.16828INTEATIE---NON-FIRM---NON-INTEG.$0.1137 $0.1077 $0.1028 %0.0988 $0.0957 80.0934 $0.0914 $0.0921 $0.0927 $0.0927 $0.0904 80.0912 $0.0915 $0.0923 $0.0931 $0.0941 $0.0952 $0.0963 $0.0975 80.09889WNTERTIEFIRM.INTEGRATEO 2°:0748 30.0747 $0.0749 $0.0753 $0:0764 $0.0770 280.0781 30.0799 90.0817 $0.0828 $0.0817 30.0838 40.0853 so.0874 $0.0895 $0.0919 $0.0943 $0.0968 $0.0994 $0.1021NFITS;is repay rer Prams SSE Ogee RE ae cede 5 0 is NAR oo CINE ;SRIYTE DEENW"ANNUAL POWER COST---ALL VALUES EXPRESSED IN LINES 12,13,4 aa8 2"ARE INS "ANNUALLY (000)42 DIESEL CASE (L3 x L6)$5,834 $6,206 $6,614 $7,049 $7,376 $7,713 $8,511 $8,689 $8,868 $9,005 $9,005 $9,202 $9,390 $9,569 $9,776 $9,993 $10,226 $10,332 $10.453 $10,58813°ALLISONLAKE (13x17)95,394 $5,410 $9,613 $9,861 $10,109 $10,364 $10,787 610,882 $10,977 $11,029 $10,940 $11,042 011,105 $11,216 $11,314 $11,809 $11,545 $11,664 $11,647 $11,65514INTERTIE-NON-INTEG.(L3 x L@)$4,434 $4,609 $4,788 $4,978 $5,168 $5,372 $5,576 $5,675 $5,769 $5,825 95,737 $5,844 $5,922 $6,033 $6,145 $6,273 $6,409 $6,546 $6,692 96,846 15 INTERTIE--INTEGRATED (L3 x 19)$2,917 $3,197 -$3,488 $3,794 |wen?109 $4,429 $4,785 $4,924 $5,084 $6,203 $5,185 $5,712 $5,908 $6,127 $6,348 $6,580 $6,822 $7,075UeeeeeeaeEnesieIaULEEEERkaeaeaeeeeeeWyaeA:Bs oO ATT STO SD MN REEA Ries ATERLS17ANNUALSAVINGS----NON-|INTEGRATED.INTERTIE----"ALL VALUES EXPRESSED IN $s.ANNUALLY (000) 18 INTERTIE TO DIESEL {L12-414)$1,400 $1,596 $1,826 $2,071 $2,209 $2,341 $2,935 $3,013 $3,099 $3,180 $3,268 $3,630 $3,720 $3,817 $3,786 $3,74219INTERTIEatlALLISONLAKELaks14):$959 #800 $4,825 $4,882 $4,941 $5,210$4,992 95,207 ANNUAL SAVINGS:rere INTEATH INTERTIE TO DEISEL {L12-L15) INTERTIE TO ALLISON LAKE {(L13-L15) ALL VALUES EXPRESSED IN ¢ $2,917 $3,009 $2,476 $2,243 ANNUALLY (000) $3,125 $3,255 $6,124 $6,066 $3,267 $5,999 $3,284 95,936 83.748 $6,022 $3,765 $5.959 $3,784 $6,893 $3,802 $5,825 MEDIUM LOW LOAD--MEDIUM FUEL YEAR 1999 SUPPLEMENTARY.KWH REQUIRED 36909 37543 2002 39639 2003 30188 38898 40282 40900 41509 421 18 42729 nae UNIT cost OF POWER PALL VALUES EXPRESSED 1N $'s KWH $0.1615 G4 ANNUAL COST OF POWER-ALL VALUES EXPRESSED IN #'=ANNUALLY (000) a4 ANNUAL SAVINGS--INTEGRATED '45 INTERTIE TO DIESEL (L35-L38) 46 INTERTIE TO ALLISON LAKE (t36-L39) $2,920 $2,480 $3,026 $2,234 $3,158 $6,164 $3,182 $6,119 $3,207 36,073 $3,227 $6,018 $3,706 $6,119 $3,723 96,056 $3,736 $5,993 3,752 $6,927 $3,820 $5,756 2008 43347 29 DEISEL EXPANSION CASE $0.1550 $0.1577 $0.1611 $0.1619 90.1627 90.1747 90.1755 90.1762 90.1760 90.1725 90.1736 30.1745 90.1749 30.1759 40.1772 80.1786 60.1773 40.1763 90.1757 30 ALLISON LAKE CASE 80.1431 $0.1366 90.2398 $0.2370 90.2342 $0.2320 60.2337 10.2317 40.2298 «40.2269 90.2207 40.2190 $0.2165 $0.2149 --$0.2131$0.2157 $0.2103 0.2089 0.2048 --$0.2009 31 INTERTIE-CL OR NF-NON INTEGRATED 90.1182 60.1977 90.1172 90.1167 90.1163 90.1162 80.1161 0.1162 80.1162 80.1153 90.1110 60.1914 0.1109 60.1192 60.9115 90.112F 80.1127 80.1135 80.1142 90.1153 32.INTERTIE---FIRM--INTEGRATEO $0.0759__$0.0771 $0.0784 $0.0797 $0.0810_80.0826 80.0841 _10.0858 _40.0875 _40.0882 40.0856 90.0876 __$0.0888_$0.0908__$0.0929 __$0.0952 30.1028 Errno re Pe :CRANE sy ;en sare as AETTLD $3,767 $5,856 $3,358 3 $3,469 $3,536 $$ $3,761 83 16!$6 $5,133 $5,118 $4,809 $3,832 $5,671 $3,870 $6,585 $3,856 $5,503 $3,868 $5,406 $3,867 $5,683 $3,877 $5,197 $3,752 $5,084 $3,631 $4,825 $3,513 $4,580 2009 43972See 2010 2011 44605 45246 2012 45895 2013 46553 vg Seeks 2014 47207 2015 47865 2018 48529 2017 49197 35 OIESEL CASE (L26xL29)98,721 95,921 $6,152 $6,282 $6,418 96,554 $7,145 $7,286 97,421 $7,520 $7,477 $7,634 $7,784 $7,914 $8,073 $8,249 $8,431 $8,486 $8,556 $8,644 36 ALLISON LAKE (126x130)$5,282 $5,128 $9,357 $9,219 $9,283 $9,345 $9,556 $9,618 $9,679 $9,695 $9,567 $9,630 $9,657 $9,723 $9,780 $9,655 $9,928 $9,999 $3,939 $9,884 37 INTERTIE--NON INTEGRATED {L26xL31)$4,363 $4.419 $4,476 $4,539 $4,610 $4,681 94,748 $4,823 $4,894 $4,927 $4,812 $4,898 $4,947 $5,031 $5,197 $5.219 $5,320 $5,433 $5,542 $5,67238INTERTIEINTEGRATED(26x32)$2.801 $2,898 $2,994 $3,soo $3.211 $3,327 $3,440 $3.685 93,769 $3,852 $3,961 $4,413 $4,264 $4,43:$4,612 $4,796 $4,989 $5,190 :sat :=ESE ONETT SEE 540ANNUALSAVINGS---NON INTEGRATED INTERTIE -ALL VALUES EXPRESED iN 8's ANNUALLY 000}41°INTERTIE TO DIESEL (L35-L37)$1,358 $1,502 $1,676 $1,743 $1,808 $1,873 $2,397 $2.461 $2,527 $2,594 $2,666 $2,735 $2,837 $2,882 $2,956 $3,031 $3,011 $3.05¢$3,014 $2,971 Iya42 INTERTIE TO ALLISON LAKE (L36-L37)seeps $710 $4,682 $4,679 wet673.$4,685 $4,810 $4,794 $4,785 $4,769 $4,755 $4,oe 24 710 ee 692 -$4,663 $4,637 $4,607.$4,566 $4,397 $4,au $3,782 95.778 $3.823 $5,696 $3,801 $6,611 $3,809 $5,517 $3,817 $5,423 $3,819 95.316 $3,690 $5,203 $3,567 $4,950 $3,454 $4,693 FNFINFMH.XLS . PRREE SUTTON TO GLENNALLEN 136 KV INTERTIE..-POWER COST _ANALYSIS.-NON-INTEGRATED CAPACITY LEASE OR ECONOMY ENERGY V5 INTEGRATED FIRM ENERGY ee2JANUARY,21,1994 REVISED 3/28/943°)ASSUMPTIONS..4 =WNFLATION ADJUSTED 102.76%ANN.PAY.. $SO YEAR,ZERO INT.LOAN 935.0 MILLION $700,000 6 35 YEAR,6.00%LOAN .917.1 MILLION 91,183,207 7 =TOTAL COST OF LINE $52.1 MILUON $1,883,207 $POWER COST CUNF 19988's (KWH?$0.035 CAPACITY LEASE OA ECONOMY ENERGY--INCLUDES 1 MILL KWH FOR WHEELING TO MEA 9 POWER COST--FIAM1998 8's (KWHI"®$0.056 INTEGRATED INTO AAILBELT SYSTEM --INCLUDES 1 MILL KWH FOR WHEELING TO MEA 10 YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 12 CASE 1A--NON-FIRM--MEOIUM HIGH LOAD--(NOT INTEGRATED) 13 POWER COST (KWH $0.0350 $0.0360 0.0370 $0.0380 $0.0390 $0,0401 $0.0412 90.0423 90.0435 90.0447 90.0459 $0.0472 $0.0485 90.0499 90,0512 #0.0828 0.0540 $0.0555 90.0570 $0.0566 14 SUPPL,KWH REQ.38,999,000 42,779,000 46,574,000 50,386,000 84,000,000 57.518,000 61,012,000 61,622,000 62,230,000 62,842,000 63,459,000 64,084,000 64,717,000 65,359,000 66,007.000 68,665,000 67,317,000 67,972,000 66,631,000 69.295.00018OEPRECIATIONINFLAT.91,043,086 $1,043,088 $1,043,088 91,043,088 $1,043,088 $1.043,088 $1,043,088 $1,043,088 91,043,088 91,043,088 91,043.088 $1,043,088 $1,043,088 $1,043,088 $1,043,088 $1,043,088 $1,043,088 $1.043,088 $1,043,088 $1,063,08816ANNUALINTERESTRATE$1,029.265 $1,020,029 $1,010,238 $999,860 $988,659 $977,198 $904,838 $981,736 $937,848 $923,126 $907,521 $690,980 $873,446 3854,861 $835,180 $814,277 $792,142 9768.678 $743,806 $727,44217SUBTOTALDESTSERVICE0%=$2.072.353 $2,063,117 $2,053,326 62,042,946 $2,031,947 $2,020,286 $2.007,926 $1,994,824 $1,960,936 $1,966.214 $1,950,609 91,934,068 $1,916,534 61,897,949 $1,878,248 01,857,365 $1,835,230 $1.851,766 $1,786,894 $1,770,53018DEBTSERVICECOSTKWH0.0531 0.0482 0.0441 0.0405 0.0376 0.0351 0.0329 0.0324 0.0318 0.0313 0.0307 0.0302 0.0298 0.0290 0.0285 0.0279 0.0273 0.0267 9.0260 0.0256 19 LINE O&M EXPENSE 2.78%$263,412 $270,686 $278,099 $288,747 $293,608 $301,679 $309,975 9318,499 $327,258 $336,258 $348,505 $355,006 $364,769 $374,800 $388,107 $395,697 $406.579 $417,760 $429,246 $441,05320STANDBYLABORDIESEL2.75%$229,054 $235,353 $241,826 $248,476 $255,308 $262,329 $269,544 $276,956 $284,572 $292,396 $300,439 $308,701 $317,190 $328,913 $334,876 9344,085 353.547 $363,270 6373,259 $383,52421DIESELPLANTO&M 2.75%$914,527 $417,676 $120,913 $124,238 $127,654 $131,165 $134,772 $136,478 $142,286 9146,199 $150,219 $184,350 $168,598 $162,956 $107,438 $472,062 176,774 $181,636 $186,630 =9191.76222,SUBTOTAL LINE OP.COST $2,679,346 $2,686,802 $2,694,163 $2,701,408 $2,708,514 $2,715,459 $2,722,216 $2,728,757 $2,735,052 $2,741,068 $2,746,772 $2,752,125 $2,757,086 $2,761,618 $2,766,668 $2,769,189 92,772,129 $2,774.430 $2,776,031 $2,786,86923LUNEOP.COST KWH 0.0687 0.0628 0.0578 0.0538 0.0502 0.0472 0.0446 0.0443 0.0440 0.0436 0.0433 0.0429 0.0426 0.0423 0.0419 0.0418 0.0412 0.0408 0.0404 0.0402 24 RESIOUAL INTEREST OIESEL ow $147,000 $137,000 $128,000 $119,000 $111,000 $105,000 $998,000 $92,000 $85,000 $80,000 $76,000 $70,000 $28,000 918,000 $3,000 25 RES.OEPRECIATION DIESEL on”$244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $195,000 .26 SUB-TOTAL COST LESS P.C.$3,070,346 $3,067,602 93,066,163 $3,064,408 $3,063,514 93,064,459 $3,064,216 $3,064,757 $3,064,052 $3,016,068 $2,821,772 92,822,125 $2,783,088 62.779,616 $2,766,868 $2,769,189 $2,772,129 $2,774,430 $2,776,031 $2,786,86927COST.LESS POWER COST KWH 0.0787 0.0717 0.0658 0.0608 0.0567 0.0533 0.0602 0.0497 0.0492 0.0460 0.0445 0.0440 0.0430 0.0426 0.0419 0.04615 0.0412 0.0408 0.0404 0.0402 28 POWER CosT 2.75%$1,364,966 $1,636,440 91,720,978 61,913,037 $2,106,634 $2,308.504 $2,512,895 92.697 Ate $2,708.967 $2,807,725 92949.282 AIOZIASR PVG Spe ek OT TIT RS £2,649 655 93,773.021 93,994,365 $4,060,923 29 TOTAL COST OF POWER $4,436,311 $4,606,242 $4,787,140 84,977,445 96,170,148 84.963 "ed ER STTLID EE De eh ee Pree:i ee "'.2146242 $6.108.784 06.547.451 36,690,396 $6,847,791 30°COST OF POWFR KWH on 0.1077 0.1028 00998 0095?a!Ons CuG27 ANSOA 00931 0.0941 0.0952 0.0963 0.0975 0.0988 32 CASE 2A--FiRM--MEDIUM HIGH LOAD--(INTEGRATED} 33°COST OF POWER (KWHI 30.0860 $0.0575 $0.0591 $0.0607 $0.0624 $0.0841 90.0659 $0.0677 $0.0696 90.0715 90.0735 $0.0755 90.0775 $0.0797 90.0819 90.0841 90.0864 90.0888 $0.0913 90.0936 34° =COST OF SUPP.POWER 2.75%92,183,944 $2,461,504 $2,763.564 $3,060,860 $3,370,615 $3,686,806 $4,020,632 $4.172.503 $4,329,547 $4,492,359 94,661,220 $4,836,573 $5,016,667 $5,207,635 $5,404,103 $5.608,.069 $6,818,648 $6,036,833 96,262,984 $6,497,4763%STANOBY LABOR DIESEL 2.75%$229,054 $235,353 $241.625 $248,475 $255.308 $262,329 $269,544 $276.956 $284,572 $292,398 $300,439 $308,701 $317,190 $325.913 $334,676 9344.085 $383,547 $363,270 $373,259 $383,52436DIESELPLANTO&M 2.78%$114,527 $197,676 $120,913 6124,238 $127,654 $931,165 $134,772 $138,478 $142,286 $146,199 $160,219 $154,350 $156,595 $162,956 $167,438 $172,042 $176,774 181,635 $186,630 $191,76237-RESIOUAL INTEREST DIESEL 0%-6147,000 $437,000 $126,000 $119,000 $131,000 $105,000 $98,000 $82,000 $85,000 980,000 $76,000 $70,000 $26,000 $18,000 $3,00038RES.DEPRECIATION OIESEL.om $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $195,000 . 39 «TOTAL POWER COST $2,910,525 $3,195.533 93,488,302 93,796,573 $4,108.577 $4,431,300 94,766,947 $4,923,937 $5.085,405 $5,208.956 $5,186,878 $8.369.625 $8,620,452 85,714,708 $5,909,417 $6,124,196 $6,348,968 96.581.738 $6,822,873 $7.072,762 40 TOTAL COST KWH 0.0748 0.0747 0.0749 0.0753 0.0761 0.0770 0.0781 0.0799 0.0817 0.0826 0.0817 0.0838 0.0853 0.0874 0.0895 0.0919 0.0343 0.0968 0.0994 0.1021 (934,287)(8132,477)($224,974)$59,816$236,816 $150,03641°°"ANNUAL SAVINGS $1,516,786 $1.410,709 $4,298,838 $1,180,872 $1,061,571 $938,662 $810,164 $748,635 3684,614 9617,837 $546,156 $475,359 $399,303 $319,811 42 TOTAL SAVINGS FOR STUDY PERIOD 912,066,250 44 _SASEO ON ML&P MIO CASE (ML&P LETTER FEB.941+1 MILL FOR WHEELING (MEA LETTER}.-**BASED ON INFORMATION PROVIDED BY CHUGACH (DECEMBER 1993)***SAVINGS COMPARING CASE 1_TO CASE 2.-a - Feme lox = = B@<- FNFINFML.XLS. SUTTON TO GLENNALLEN 138 KV INTERTIE---POWER COST ANALYSIiS--NON-INTEGRATED CAPACITY LEASE OR ECONOMY VS INTEGRATED FIRM (seu)LvNAMEJANUARY,21,1994 =REVISED 3/28/943ASSUMPTIONS 4 INFLATION ADJUSTED 102.75%ANN.PAY. $80 YEAR,ZERO INT.LOAN 935.0 MILLION $700,000 6 36 YEAR,6.00%LOAN 917.1 MILLION $1,183,207 7 TOTAL COST OF LINE 952.1 MILLION $1,883,207 &POWER COST CLUNF 19988 (KWH}®0.038 CAPACITY LEASE OR ECONOMY ENERGY--INCLUDES 1 MILL KWH FOR WHEELING TO MEA 9 POWER COST FIRM 19989 {KWHI**$0.056 INTEGRATED INTO RAILBELT SYSTEM --INCLUDES 1 MILL KWH FOR WHEELING TO MEA 10 YEAR 1996 1999 2000 2001 2002 2003 2004 2005 2008 2007 2008 2009 2010 2011 2012 2013 2014 2015 WW 32 CASE 1A--CAPACITY LEASE OR NON-FIRM--MEDIUM LOW LOAD--(NOT INTEGRATED): 13°POWER COST (KWH)$0.0350 $0.0360 9.0370 $0.0380 0.0390 90.0401 0.0412 $0,0423 0.0435 $0.0447 0.0459 90.0472 0.0486 90.0498 0.0512 90.0526 0.0540 90.055514SUPPLEMENTALKWHREQ.WNFLAT.36,909.000 37,543,000 38,188,000 38,898,000 39,639,000 40,282,000 40,900,000 41,509,000 42,118,000 42,729,000 43,347.000 43,972,000 44,605,000 45,246,000 45,895,000 46,553,000 47.207,000 47,865,00015DEPRECIATIONRATE$1,043,088 $1,043,088 $1,043,088 $1,043,088 $1.043,068 91,043,086 $1,043,088 $1,043.088 $1,043,088 1.043.088 $1,043,088 $1,043,088 $1,043,088 $1.043.088 $1,043,088 $1,043,088 $1,043,088 $1,043,08816ANNUALINTEREST$1,029,265 $1,020,029 $1,010,238 $999,860 $988,859 $977,198 $964,838 ©$951,736 $937,848 $923,126 $907,521 $890,950 $873,446 $854.86t $835,160 $814,277 $792,342 $768,67817SUBTOTALDESTSERVICE$2,072,953 92,063,117 $2,053,328 $2,042,948 $2,031,947 $2,020,286 $2,007,926 31,994,824 $1,980,936 $1,966,214 1,950,609 $1,934,068 $1,916,534 $1,897,949 $1,878,248 $1,957.368 $1,838,230"97,81 1,76818DEBTSERVICECOSTKWH0.0561 0.0850 0.0538 0.0825 0.0513 0.0502 0.0491 0.048t 0.0470 0.0460 0.0450 0.0440 0.0430 0.0419 0.0409 0.0399 0.0389 0.037919LINEO&M EXPENSE 9263,412 $270,656 $278,099 $286,747 $293,605 $301,679 $309,975 $318,499 $327,256 $336,258 $345,505 $358,006 $364,769 $374,800 €385,107 $395,697 $406,579 $417,76020STANDBYLABORDIESEL$228,054 $235,383 $241,825 9248,478 9285,308 $262,329 $269,544 $276,950 $284,572 $292,398 $300,439 $308,701 $317,190 $325,913 $334,876 $344,085 $353,547 $363,27021DIESELPLANTO&M $414,827 $117,676 $120,913 $424,238 $127,654 $131,165 $134,772 $138,478 $142,288 $146,199 $160,219 $154,350 $156,595 $162,986 9167,438 $172,042 $178,774 $161,63522SUBTOTALLINEOP.COST $2,679,246 92,686,802 $2,694,163 $2,701,408 $2,708,514 $2,715,459 $2,722,216 $2,728,757 $2,735,082 $2,741,068 $2,746,772 $2,752,125 $2,757,088 $2,761,618 $2,765,668 $2,769,189 $2,772,129 $2,774,43023«LINE OP.COST KWH 0.0726 0.0716 0.0708 0.0694 0.0683 0.0674 0.0666 0.0657 0.0649 0.0642 0.0634 0.0826 0.0618 0.0610 0.0603 0.0595 0.0587 0.058024RESIDUALINTERESTDIESEL$147,000 $137,000 $128,000 $419,000 $111,000 $105,000 $98,000 $92,000 $85,000 $80,000 $75,000 $70,000 $26,000 $18,000 $3,00025RES.DEPRECIATION OIESEL $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $195,00026SUB-TOTAL COST LESS P.C.93,070,346 03,067,802 $3,086,163 $3,064,408 $3,063.614 $3,064,459 $3,084,216 93,064,757 $3,084,052 $3,016,068 $2,821,772 $2,822,125 $2.783.088 |$2,779,618 $2,768,668 $2,769,189 $2,772,129 $2,774,43027°COST,LESS POWER COST KWH 0.0632 0.0817 0.0803 0.07866 0.0773 0.0761 0.0749 0.0738 0.0727 0.0706 0.0651 0.0642 0.0624 0.0614 0.0603 0.0595 0.0587 0.088028«POWER COST $1,291,818 $1,350,140 $1,411,103 $1,476,865 $1,546,387 $1,614,687 $1,684,644 $1,756,641 $1,631,430 $1,909,094 $1,989,965 $2,074,170 $2,161,890 $2,253,264 $2,348,438 $2,447,615 $2,550,256 $2,656,91229TOTALCOSTOFPOWER94,362,161 $4,417,942 $4,477,265 $4,841.273 $4,609,901 94,679,148 $4,746,760 $4.821,399 $4,895,483 $4,925,162 $4,611,737 $4,896,296 $4,944,976 95,032,882 $5,117,106 $5,216,805 $65,322,385 $5,431,34330COSTOFPOWERKWH0.1182 0.1177 0.1172 0.1167 0.1163 0.1162 0.1161 0.1162 0.1162 0.1183 0.1110 0.1314 0.1109 0.1112 0.11915 0.4121 0.1127 0.1135 32 CASE 2A--FIRM--MEDIUM LOW LOAD--(INTEGRATED) 33>POWER COST (KWH)30.0860 0.0875 9.0891 0.0607 0.0624 0.0641 0.0659 0.08677 0.0698 0.0718 0.0738 0.0755 0.0775 0.0797 0.0819 0.0841 0.0864 0.088834COSTOFSUPP.POWER $2.066.904 $2,160,224 $2,257,764 $2,362,984 $2,474,218 $2,583,498 $2,695,270 $2,810,626 $2,930,289 $3,054,550 $3,183,944 $3,318,672 $3,459,024 $3,605,222 $3,757,500 $3,916,185 $4,080,409 $4,251,060 ©35 STANOBY LABOR OIESEL $229,056 $235,353 $241,828 $248,475 9255,308 $262,329 $269,544 $276,956 $284,572 $292,398 $300,439 $308,701 $317,190 $325,913 $334,876 $344,085 $353,847 $363,27036DIESELPLANTO&M $114,527 $117,676 $120,913 $024,238 9127.654 $131,165 $134,772 $130,476 $142,286 $146,199 $150,219 154,350 $588,595 $162,956 $167,438 $272,042 $176,774 $181,63537RESIDUALINTERESTDIESEL$147,000 $137,000 $428,000 $119,000 9141,000 $105,000 $98,000 $92,000 386,000 $80,000 $78,000 $70,000 926,000 $18,000 $3,000 38 RES.DEPRECIATION DIESEL $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $244,000 $195,00039«TOTAL POWER COST $2,801,485 $2,694,254 $2,992,502 $3,098.697 $3,212,181 $3,325,993 $3,441,586 $3,562,060 $3,686,147 $3,768,147 $3,709,602 93,881,724 $3,960,809 $4,152,092 $4,262,814 $4,432,312 $4,610,730 94,795,96440TOTALCOSTKWH0.0771 0.0784 0.0797 0.0810 0.0826 0.0841 0.0858 0.0875 0.0882 0.0856 0.0876 0.0888 0.0909 0.0929 0.0952 0.0977 0.1002 41 ***ANNUAL SAVINGS.$1,560,676 $1,523,689 $1,484,763 $1,442,576 $1,397,720 $1,353,153 $1.307,175 $1,259,338 $1,209,336 $1,157,015 $1,102,135 $1,044,572 $984,169 $920,791 $854,292 $784,493 $714,655 $635,37842°TOTAL SAVINGS FOR STUDY PERIOD $21,770,074 . 44 "BASED ON ML&P MID CASE +1 MILL FOR WHEELING (ML Py LETTER FEBRARY.1994-.**BASED ON_INFORMATION PROVIDED BY CHUGACH IDECEMBER 1993)*°*SAVINGS COMPARING CASE 1 TO CASE 2. 2016 0.0870 +48,529,000 $1,043,068 $743,806 91,786,894 0.0388 $429,248 $373,259 $186,630 $2,776,031 0.0572 92,776.031 0.0572 $2,767,849 $5,543,880 0.1162 0.0913 $4,428,558 $373,259 9186,630 $4,986,447 0.1028 $655,433 2017 30.0586 49,197,000 $1,043,086 727442 $1,770,530 0.0360 $441,053 $383,524 $191,762 $2,786,869 0.0566 22,786,869 0.0566! 92,883,112 96,669,980 0.1153 0.0938 $4,612,978 $383,524 $191,762 $5,188,265 0.1055 $481,716 February 25,1994 Telephone comment received by Herv Hensley,Director,from Mr.John Netzel: Mr.Netzel stated that there should be at least two substations connected to the proposed intertie.He stated that the intertie should not be just for large consumers in Valdez and Glennallen but should be accessible as well to small consumers who are not presently connected to utility power.Further,he stated that people whose rates would be affected by the intertie should have a firm quote of what their electricity rates would be after completion of the project. 7021 Hunt Ave. Anchorage,Ak.99504 February 24,1994 Herv Hensley,Director meCeiv oD Division of Energy,DCRA 333 W.4th Ave.Suite 220 FEB 25 1994 Anchorage,Ak.99501-2341 DIVISION OF ERE evi Dear Sir: The following are comments on the draft Sutton to Glennallen/Copper Valley Intertie feasibility study.- Although there are some potential environmental impacts which I think the draft downplays,I think careful planning,alignment and construction techniques can minimize potential harm to scenic,recreational and wildlife impacts.In particular, I think the scenic vistas from King Mountain to Eureka Summit should be strictly protected from obvious power line intrusions. My principal concerns center on the economics of the project.As a state citizen and potential state taxpayer in the near future,I am very worried that project costs will exceed those stated,that excessive power costs will result,that "loans”may not be repaid and that ultimately,the state will be stuck with the bill--to the detriment of other needed state programs and projects. The proposed line appears to be feasible only under the high and medium-high load _growth cases.At lesser loads other alternatives become superior.The higher loads depend on greatly increased demand by the Valdez refinery continuing through 2047.1)Why would one ever build a very expensive project based on more than a mid-range case?A conservative estimate of long-term demand is warranted when tens of millions of state,local utility and rate-payer dollars are involved. 2)Sensible analysis of demand is warranted.Reliance of refinery power demand through 2047 ignores the expected realities of the plant's feedstock--oil.Production through TAPS is now in steady decline and is not expected to be at high enough ilevelstoeconomicallyrunthelineanadditional20years,let alone yield enough royalty oil to fuel to Valdez refinery for more than 50 years.fThedecisiontoappropriatethe$35 million,0%interest loan was tied to this feasibility study for good reason.Without an honest,straightforward presentation .of the feasibility of this project it could well end up to be a much larger expenditurethananyone--the legislature,the rate-payers or the citizens of Alaska-everbargainedfor.Now is the time to take a hard look,dig for some information,makesomereasonableassumptionsandtakealonger-range view of the choices before us. Matanuska Electric Association,Inc.NECEIVED P.O.Box 2929 MAR 1°1994Palmer,Alaska 99645 -DivTelephone:(907)745-3231Fax:(007)745-9328 :SION oF ENERGY/DCRA February 24,1994 Mr.Herv Hensley,DirectorDivisionofEnergyDepartmentofCommunity &Regional AffairsStateofAlaska 333 W.4th Avenue,Suite 220 Anchorage,Alaska 99501-2341 Dear Mr.Hensley: Subject:Proposed Sutton to Glennallen Intertie MEA Comments on Draft Feasibility Study Matanuska Electric Association,Inc.(MEA)staff has reviewed the draft report of theFeasibilityStudypreparedbyR.W.Beck and Associates,Inc. We would offer several general comments about the study,followed by specificcommentsontheestimatedcostofline.Finally,we offer several comments aboutright-of-way acquisition,permitting and the environmental analysis. Probably the most important problem that we noticed is that Page X-17 shows thelowestenergycostavailabletobeAlisonLakebutitdoesnotincludepaymentforpowerasdescribedinFourDamPoolAgreement.We believe that showing thisfigureismisleading.There is no reason to believe that power could be obtainedwithoutpayment;indeed,all available evidence would indicate the opposite. Page IX-19 indicates that economy energy may not be available from ChugachElectricAssociation(CEA)and/or Anchorage Municipal Light &Power Co.(AML&P)in the future,because their loads will grow to match their existing generation.This issimplynottrue.As the CEA and AML&P loads grow,CEA and AML&P will installadditionalgenerationtoprovideacapacitymargin.At the present time,they havebothagreedtoprovideacapacitymarginequalto30%of their peak load.This willresultmeconomysalescapabilityfortheforeseeablefuture.The capability to buyandselleconomyenergywillbelimitedonlybythecapacityoftheexistingCVEAgenerationtoprovidebackupcapacity,and by availability of generation at CEA andAML&P with regard to maintenance,or forced outages of generation. On page IV-2,there is a discussion of problems on the CVEA system due to a faultand/or backfeed of the O'Neill,Eklutna,Shaw transmission line.A three-terminallinepresentsinterestingproblemsinprotectiverelaying,but the line in questioncould,and should,be relayed to open at the proposed Sutton autotransformer stationandisolatetheCVEAsystemfromtheproblem. Mr.Herv Hensley Page 2February 24,1994 It W. pears to us that there are a number of corrections that should be made to the R. feck Feasibility Study which would tend to lower the estimated cost ofconstructingtheSutton-Glennallen Intertie and improve the project's economicfeasibility. 1.On page IV-I1,there is a statement that the proposed intertie is perpendicular totheprevailingwind.This is contrary to the winds I have observed along therouteoftheline.In my experience,the wind tends to parallel the valleys,andthuswouldparallelmuchoftheline. On page IV-21,there is a statement that "Rock may be encountered in loadingZoneiandwewillassumerockanchoredfoundationtypesforthefeasibilitystudy.”This statement needs explanation.How many rock anchors?Wherewilltheybeused?The geological data demonstrates that Loading Zone 1°contains very little rock.: On page IV-24,there is a typographical error which repeats the disadvantages ofSSACTeal. Figure V-2 is a one-line diagram of the proposed step-up station at Sutton.ThediagramindicatestwofullsetsofCCVTsandtwoPVTs.Only one set of PTs isneededformeteringandrelaying,and one additional CCVT or PT forsynchronizing.The PVTs are not necessary,as station service can be providedfromthelocaldistributionsystem.The diagram also indicates a circuit breakerandacircuitswitcher.Two circuit switchers would provide equal performance.This is because available fault currents are well within the ratings of the circuitswitcherandnecessarycurrenttransformerscaneasilybeplacedonthetransformerbushings.These changes would result in substantial cost savings,and no functional change.Further savings could be realized by incorporatinglinedisconnectsforthetappointintothesamestructureusedfor115KVcircuitswitcherdisconnects. On page VI-6,there is a table showing estimated costs of various types ofconstruction.This table indicates that single pole wood construction and "X”"frame steel construction cost essentially the same amount per mile.On pagesVI-14,and VI-15 there are historical actual costs of similar transmission lines inAlaska.The historical data does not include the 15-mile wood pole line toSutton,but its costs are in line with the costs of other single pole wood linesshown.The historical costs of single pole wood line is about 60%of the cost ofsteel"X"tower line.In light of this,we are very surprised that the estimatedcostofnewlineisthesameforbothtypesofconstruction.We believe anexplanationisneeded.-. The following comments pertain to Table I-2 on Page I-7 of Volume I,Section D.6 1. ay Acquisition: The $1,000 per acre acquisition cost should also be applied to Native selectedlands,Mat-Su Borough lands,and State Mental Health (MH)lands.In addition,the route(s)should be double checked to determine if any University of Alaskalandsarecrossed.If so,they should also be considered compensable at the Mr.Herv HensleyPage3February24,1994 estimated $1,000 per acre fair market value.It should also be noted that the$1,000 per acre figure is purely a ball park order-of-magnitude estimate.Fairmarketvalueappraisalswillhavetobepreparedtodeterminetheactualcompensationamounts. 2.The estimated $100,000 cost of the services of a Right of Way Agent is notincludedinTableI-2,and we believe it should be.We question the statementonPageVI-3 of Volume I (in the last paragraph)that the cost is assumed to beincludedintheeasementcost-per-acre.It is our belief that the entire$1,000/acre should be allocated to reflect the actual compensation amount for theeasementrightstobeacquired. 3.At several of the recent public hearings it was pointed out that there was no costallocatedforpossibleeminentdomainorotherlegalproceedingsforrightofwayacquisition.This may be a valid observation,Judging from comments at thepublichearings.Several members of the Chickaloon Moose Creek NativeAssociationtestifiedthattheywillopposeanyattemptstoacquireaneasementacrosstheirlands. Also,strong opposition was expressed by the Chickaloon Community Council forthelinebeingbuiltwithintheChickaloonSpecialUseArea,an area whichextendsfromKingsRivertoLongLakeandencompassessome164squaremiles,and which requires Conditional Use Approval from the Mat-Su BoroughPlanningCommission. Another possible problem area is acquiring a right of way easement on Mat-SuBoroughownedland,which requires approval by the Borough Assembly.TherequiredpublichearingbeforetheAssemblywillpresentanotheropportunityfortheSutton,Chickaloon and Glacier View area residents to comment on the line.; All three of the above situations could potentially involve litigation,or at theleastanabnormallylargeamountofadministrativeeffort. On Page I-3 of Volume 2,in the Environmental Analysis prepared by Dames &Moore,it is stated that a Corps of Engineers (COE)Section 404 permit could be _required.It might be worth noting that an individual "404"permit is required only ifdredgeorfillmaterialisdepositedinwetlands,or if wetlands are excavated for otherthantransmissionlinestructurefoundations.The placement of transmission linestructuresiscoveredbyCOENationwidePermitNo.12 and only requires that anyexcessexcavationmaterialberemovedtouplandareasandanydisturbedareasinwetlandsberevegetatedwithnativevegetationoccurringinthegeneralvicinity. Another minor item is worth pointing out in this section of Volume 2.There isastatementthatsaystheMat-Su Borough "...could also require land use permits andutilitypermitsforanyuseofBoroughlands.”That is true,but it should also bementionedthat,where the transmission line crosses Borough lands,a formal right ofwayeasement,approved by the Borough Assembly,is required.This involvessurveyingtoderivethespecificeasementdescriptionandafairmarketvalueappraisaltodeterminethecompensation. Mr.Herv Hensley Page 4February 24,1994 Finally,as you are probably aware,based upon the public hearings held throughoutthislastyear,there is strong opposition to the line by MEA membersin the Sutton,Chickaloon and Glacier View areas. Thank you for the opportunity to comment on the draft Feasibility Study. Ken RitcheyGeneralManage EDES.784 _-bdAIPARPASAAAAs{|So EES SAE TRC taSSHtuaPekRiNyaydeh WALTERJ.HICKEL,GOVERNORSwbbetsVePemahypmtkpam_eo iw i UL aa ae OS Shh a DEPARTMENT OF NATURAL RESOURCES /VALDEZICOPPER RIVER AREAWERA/BOX 185 DIVISIONOFFORESTRY ' =puoner wonezeteee February 14,1994 . )FEB 15 1994 Mr.Herv Hensley -DIVISION OF ENERGY/DCRAStateofAlaska -Department of Community and Regional AffairsDirector-Division of Energy 333 W.4th Avenue,Suite 220 Anchorage,AK 99501-2341 RE:Forestry Issues Related to the Copper Valley IntertieFeasibilityStudy Dear Mr.Hensley: I have reviewed the Copper Valley Intertie Feasibility Study andhaveafewcommentstoofferonbehalfoftheDepartmentofNaturalResourcesDivisionofForestry.The project has not had acomprehensiveDepartment-wide review and the views expresseddo notreflecttheDepartmentofNaturalResources'(DNR)officialposition.I do not.speak for all of the DNR Divisions. If the preferred route (Route Alternative D)is approved andfundingforconstructionoftheintertieissecuredIwouldexpecttohavearoleinreviewingtheprojecttoensurecompliancewith the Alaska Forest Resources and Practices Act.The project willimpacttheDivisionofForestry's Valdez/Copper River Area and the Mat-Su Area.It is important that both offices are kept informed as the project will have potential impact on several aspects of the Division's operations.Please add to your mailing list: Mr.Jim Eleazer Mat-Su Area Forester P.O.Box 520455 Big Lake,AK 99652 892-6027 Fax:892-7958 Mr.Martin Maricle ; .Valdez/Copper River Area Forester P.O.Box 185 Glennallen,AK 99588 822-5534 Fax:822-5539 I have a number of concerns and will briefly outline some issuesthatIfeelshouldbeaddressed.My area of responsibility begins at Mile 115 of the Glenn Highway so I will not address the Sutton to Sheep Mountain segments of the proposed intertie. ey .Zl canted on recyciec cagar oy 5.5. Mr.Herv Hensley Copper Valley Intertie Page Two FOREST.CLEARING I have reviewed the maps included in the feasibility study and it appears that the route will avoid most of the heavily forested stands.I have not reviewed recent aerial photographs for the proposed route(s)but there may be some viable commercial timber near Tolsona Creek.If the Alternate route segment between Points 27 and 29 is used this will cross state land near commercial stands of timber in the Plumb Bob Lake vicinity.There may be some stands with significant commercial salvage value from Point 28 to Point 30 (at Pump Station 11). The Division of Forestry would be very interested in reviewing any clearing contracts prior to their release to potential bidders.We could 'help develop a specific site treatment plan,subject to © available funding. I read the letter from Red Carlos Contracting (Exhibit F-3) regarding site clearing and was concerned that there was no provision to remove or salvage larger trees and that there was no specific mention of the requirement to obtain a permit from the Division of Forestry (AS 41.15.0600).I assume that clearing work would be contracted out and Mr.Carlos was providing some estimates of what the job would entail. Much of the clearing could be accomplished as Mr.Carlos describes in his letter of June 16,1993.It is unlikely that the contractor would want to broadcast burn the sites due to logistical difficulties and costs.It is hoped that the centerline of the project and the clearing limits would be clearly marked on the ground prior to any actual clearing project.This would be imperative to keep the contractor performing the desired treatmentintheproperlocation. The intertie corridor is in an area of fairly intense bark beetleinfestations.Bark beetles do not typically attack black sprucebutitisveryimportantthatoperationsbeconductedinsuchawaytopreventdamagetoresidualtreesandtoavoidleavingpilesoflargerdiametersprucetrees. POTENTIAL EFFECTS ON FIRE OCCURRENCE' There was some discussion in the feasibility study about thepossibilityofupgradingsometrailsonstatelandtofacilitate construction and maintenance of the power line.I am concernedthatupgradingany.trails with the intent to create access to thepowerlinescouldincreasethepossibilityofhumancausedfiresinremotelocations.Much of the intertie corridor receives Limited protection and this protection level was established because the Mr.Herv Hensley Copper Valley Intertie Page Three probability of wildland fire was viewed as minimal.If roads are built to drive equipment to the intertie route this could allow all terrain vehicle (ATV)access and the Division could see an increase in abandoned campfires in the remote wildlands.Perhaps upgradedtrailscouldbegatedandlockedandtheDivisionofForestrycouldbeprovidedakeysothatpersonnelcouldrespondtofires. As was discussed earlier,a burn permit must be obtained to debris burn between the dates May 1 through September 30.It is recommended that burning be conducted in the fall and some particularly hazardous fuels could even be burned when there is a snow cover on the ground.The Division's Fire Management Officer or Area Warden could help work out specific burn plans. I am also concerned with the possibility of additional fires caused by trees falling across the electrical lines.I have reviewed the engineering diagrams and it appears that the timber will be cleared from the towers and this will substantially reduce the likelihood of electrical fires along the intertie.It seems that periodicmaintenanceoftheroutewillbeneededtokeeptimberfrom becoming a hazard to the line.Perhaps clearing will have to be conducted every twenty years to keep vegetation from the powerline. Can the intertie withstand the effects of wildland fire on surrounding vegetation?Fire can burn quickly through continuous black spruce stands and the burning timber can generate some fairly intense radiant heat.If fire would be a threat to the intertie would the Division need to suppress fires that would burn over the intertie? TECHNICAL AND ADMINISTRATIVE SUPPORT The Division looks forward to working with future contractors and with your staff if the project is funded and constructed.We could help develop burn plans,determine specific clearing parameters, issue burn permits,and monitor operations on the State's behalf. Unfortunately,I have limited staff availability and I would be happy to propose a reimbursable service agreement (RSA)that would help cover our additional expenses of staff time,travel and so forth.We would like to fulfill our regulatory obligations as the project gets underway and our active involvement may help to ease some of the public's concerns. Thank you for the opportunity to provide some comments.We look forward to working with you on this project and would be happy to review future modifications of the proposal.I was not on theoriginalmailinglistandIhadtoborrowacopyofthefeasibility study from the Copper Valley Electric Association. Mr.Herv Hensley Copper Valley Intertie Page.Four Let me know if you have any thoughts regarding my comments.I look forward to hearing from you soon. Sincerely, |2: artin D.Maricle Valdez/Copper River Area Forester cc:Clayton Hurless-CVEA John See-DNR/DOF Al Samet-DNR/Lands Bruce Stafford-DNR/Lands Jim Eleazer-DNR/DOF MEMORANDUM State of Alaska DEPARTMENT OF FISH &GAME TO:Dick Emmerman .DATE:March 11,1994...Senior Economist nECEWED Division of Energy FILE NO.3: Department of Community MAR 15 1994 and Regional Affairs TELEPHONE NO.:267-2284 DIVISION OF ENERGY/DCRA2AdoosSUBJECT:Copper Valley Inter-hmm é tie;FeasibilityFROM:Cevin Gilleland Study:Draft ReportHabitatBiologist Region II Habitat and Restoration Division Department of Fish and Game The Alaska Department of Fish and Game (ADF&G)was unable tocompleteathoroughreviewandanalysisofthesubjecttwo volume document.We are primarily concerned that the route, construction,and maintenance activities avoid sensitive fish and wildlife habitats and that these activities minimize and fully mitigate impacts to important wetlands and fish bearingwaters.Permits from the ADF&G will be required for all activities in or on the bed or banks of specified anadromousfishbearingwaters.Full plans and specifications should be provided to the ADF&G,Habitat and Restoration Division,earlyintheplanningstagessothattimingcanbeplannedtocoincide with the absence of sensitive life stages. The ADF&G suggests that alternatives be considered to avoid impacts to fish and wildlife.This should involve the identification of sensitive habitat areas specifically along the proposed route,as well as alternative locations,design features,and construction methods (timing;underground placement;markings).This should probably include scientific surveys conducted on the ground along the proposed route.A solid fish and wildlife survey database will provide the information necessary to fully evaluate construction methods, permit requirements,and mitigation. Because of other staff commitments we are unable to provide additional assistance,except for those aspects of the project that require the approval of the ADF&G.Please contact me if I can be of assistance in determining those aspects of the. proposed project that require ADF&G approval. cc:R.Thompson,DNR/DL J.Westlund,ADF&G Tua Jim Colver 4 Palmer,AKauNaAFGIONALagFAIRSPalme February 24,1994 cont Director Division of EnergyDepartmentofCommunity &Regional Affairs 333 W.4th Ave.,Suite 220 Anchorage,AK naen-«-FAINA Re:Copper Valley Intertie Feasibility Study Draft Report Comments Dear Sir: I offer the following comments regarding the Copper Valley Intertie Feasibility Study Draft Report.Please incorporate them into the final FeasibilityStudyReport.. I.Economics The draft Feasibility Study finds that in order to derive any economic benefits from an intertie,the scenario of a large increase in demand at the Petro Star Refinery is necessary.There exists no committment,nor a "take or pay" agreement with Petro Star to purchase the amount of energy demand forecasted in the study.Given this mid to high load range projection demand variable,and to protect ratepayers,any further consideration of this project should be predicated upon such a contract.If the line were built speculating on this high load,without a take or pay agreement,and the load did not develop,sharply higher electric rates would be necessary to retire the intertie debt.Furthermore,with the Trans Alaska Pipeline forecast to shut down in 2017,why does the study assume Petro Star will continue to operate untill 2047?These appear to be the major flaws in the study'seconomicfeasibilitymodel. The study shows the Allison Lake hydroelectric project to be the least costalternativeforsustainableenergygenerationforCVEAconsumers.This optionbecomesevenmoreattractivegiventheconsiderablehurdlesanintertiewouldhave to overcome including:archeology,environmental concerns,geotechnicalengineering,crossing public recreational lands,crossing wetlands and criticalhabitatsofendangeredspecies,negative impacts on the tourism industry,pressureonfishandwildlifepopulationsfromaccesstoandalonganintertierightofway,reliance on the Petro Star Refinery,and major opposition from Matanuska SusitnaBoroughcommunities. II.Access Roads The draft study does not specify what and where access roads will be located.Increased access off the highway to the intertie will have the most significantimpactofthisproject.Yet there is no siting of proposed road locations,nor does itquantifywhattheenvironmentalandsocialimpactswouldbe.New and improvedroadswillputadditionalpressureontherecreational,fish,and wildlife resources of adjacent lands according to the Environmental Report.Therefore,for this to beconsideredaproperfeasibilitystudy,the impacts of proposed access roads shouldbeaddressedinthefinalreport.Furthermore,to minimize said impacts,accessroadsshouldnotbebuiltfromthehighwaytotheproposedtransmissionline. II.Routing A.The Draft Feasibility Study preferred route on map page 2 parallels thehighwayalongthesouthfaceofAnthraciteRidge,crossing Purinton and CascadeCreeksdespiteGlacierViewcommunitypreferencesfortheBoulderCreekroute.Reroute this section in the final study to follow the Boulder Creek alternate atstation4A,"Simpson Cabin".In support of the alternate Boulder Creek route over the preferred highway/Hicks Creek route consider the following evaluation criteria,the same as was used by the study's transmissionline engineer:=. 1)Cultural resource conflict ,at section 4A on map page2 the preferred routeparallelstheNelchinatrail,this is where indigenous peoples were believed to have traveled along Anthracite Ridge,so the possibility of the existence of archaeological remains is high; 2)Visual Intrusion ,there are residences and private property located along the highway in the Cascade Creek to Hicks Creek vicinity; 3)Scenic Viewshed,the intertie will be visible from the highway if sited 1 mile parallel along the north side of the highway traversing the south face of Anthracite Ridge; 4)Unstable Slopes ,Anthracite Ridge is an unstable geologic formation,there is frequent avalanching of rock on the road in the Long Lake area; 5)Stream Crossings ,there are no less than 7 stream crossings along the preferred highway route; 6)Increased Access,close proximity of preferred route to the highway and trailheads will heavily impact the surrounding land,and wildlife resources; 7)No Substaion in the Victory Bible Camp vicinity ,Matanuska Electric Assn.testified at the Glacier View Draft Feasibility Study public hearing that MEA has no future plans for a locating a substation in the area.Therefore the necessity of a substation is not a valid design factor for the intertie. B.On map page 1,the preferred route goes along the south face of Knob Hill,where the line crosses Granite Creek,it will be visible from the highway , according to the study.To mitigate this visual impact,the line should be reroutedaroundthenorthsideofKnobHillinthefinalreport. In general,a backcountry intertie route is preferable to an alignment near or visible from any point on the Glenn Highway. IV.Electromagnetic FieldsTheFeasibilityStudyDraft Report assumes a minimum safety clearancedistanceof600feetfromresidencesinordertoahateexposuretopossiblecancercausingelectromagneticfields.The 600 foot setback is based upon a 138 KVtransmissionline.However the Legislature granted legal authorization for the linetobeupgradedtoahighervoltage.To protect children from any risk of leukimia,the safe distance from residences and private property should be increased to a minimum of 1320 feet,to responsibly plan ahead for any future increase in the line's voltage. In summary,given the marginal economic feasibility of an,intertie project between Sutton and Glennallen,at a time when the State of Alaska is experiencing a severe deterioration of revenues,the project does not meet the "feasibility"test, does not warrant any further consideration,and should be dropped. w/aimColver cc Commissioner Edgar Blatchford [a WALL STREET:Dow falls 19.98 /D-4°es "=,CLASSIFIEDS: THURSDAY,February 24,1994 ANCHORAGE Dany Nas ee,- 'Pipeline.-approaches"milestone't Associated |Press .Thezotratis-Alaska pipeline is{about to hit a marker*\<-pumping through its :0 billionth barrel ofoll. Alyeska Pipeline of-"ficials say the 10 billion mark will be reached sometime this week, though no one knows just when..When the pipelinewasfinishedin1977, estimates of recover- .able North Slope oil de-.posits were just under 9billionbarrels.That es- timate has since been"T recalculated to be about: 13 billion barrels. The pipeline now transports around 1.5 'million barrels a day, about a quarter of U.S. domestic production. ys HOW LONG WILL THE PIPEL-ENE PUMP NORTH SLOPE OIL?13 BILLION BARRELS ,ESTIMATED RESERVES10BILLIONBARRELSPRODUCED3BILLIONBARRELSREMAININGRESERVES CALCULATE LIFE OF TAPS: 3,000,000,000 BARRELS RESERVE/1,500,000 BARRELS DAILY PRODUCTION 2000 DAYS OF PRODUCTION AT CURRENT PRODUCTION LEVELS 5.48 YEARS OF PRODUCTION AT CURRENT LEVELS* *(this does not account for lower future pipeline pumping levels) ee MARIOS 1293 Feb.22,1994 CUM Meio.sTive General Delivery JOMMIUINITY&REGIONAL AFFAIR:Sutton,Ak.99674 Commissioner Edger'Blatchford Office of Community and Regional Affairs Dear Commissioner'Blatchford: I'm writing to comment on the recently published -Feasibility Study for the proposed Sutton to Glennallen Intertie. The Study examines several demand vs.cost scenarios. In order to decide whether to go ahead with the intertie project,you must determine which scenario is most realistic.For the reasons I address below,I believe this study is flawed in that it does not provide you or the public with a even-handed or reasonable prediction as to the costs of the proposed project,or the future needs of the Copper Valley region. Additionally,I agree with the conclusions arrived at by Mark Foster,P.E.,who has performed an independent assessment of the Draft Study.I would like to hereby incorporate by referrence that assessment into my comments.| Costs 1.The construction costs of the project have been seriously underestimated in the Study.Labor costs,the ; cost of helicopter construction,and the cost of . condemnation of private land along the 120 mile route are underestimated.Right-of-way around the proposed line has been reduced from the standard 150 ft.to 125 ft., thereby lowering cost,but also increasing the risk of fire to the forests along the route.The Study does not adequately address the legal fees that will arise in the permitting procedure,nor does it consider the considerable costs of defending law suits from the growing opposition to theintertie.Additionally,the projects estimated costs do not include the $5.6 million cost of a Static Var Compensator which will become necessary when the the proposed intertie carries a 27 Mw load.(We were told this by John Heberling of R.W.Beck at the Feb.10 meeting in Sutton.) However,if the powerline is built,we must assume that it will eventually be used to its full (40 Mw)capacity - otherwise why build it?Thus,this $5.6 million extra must be included at this stage to reflect the true costs of the project. There are other inaccuracies in cost estimates,but I refer you to Mark Foster's comments for those underestimates. Additionally,the Study does not attempt to assess the costs of the project to the rural communities in the Matanuska Valley.The communities of Sutton,Chickaloon, Glacier View,and Sheep Mountain are small and the few businesses and jobs that do exist in the Valley are dependent on tourism.Many business people,especially those focusing on recreational activities such as rafting, hiking tours,and trail rides,will be adversely affected by the construction of this proposed intertie.Visitors come to this Valley,as they do to the State and National Parks around the State,because this area provides pristine wilderness and spectacular scenery.If you have been hiking or snow machining in the Talkeentna mountains,you know that a five day trip into the mountains would take you far behind the proposed route of the powerline. However,a one day trip (and most tour outings are day- trips)would take the lucky sightseer directly to the powerline or just above it.People will not be inclined to hire a guide to take them up to a vista with a spectacular view of a huge powerline -a string of 80 ft towers set . within a 125 ft right of way.This is not what outdoor enthusiasts seek out.They will go elsewhere. Just as recreational users have created a vigorous economic base for the towns of Cantwell,McKinley Village, Chitina and McCarthy,the Matanuska Valley has begun to build its own tourism base.Building a huge electric powerline along the bus road into the heart of Denali Park (if the State could do it)would be unthinkable due to its disastrous economic effects.Similarly,building this proposed intertie will stunt the growth of tourism business in the Matanuska Valley.The Study places a zero value on this cost.I hope to see a realistic value placed on this aspect of the project cost in the final version of the Study. Next,the Study fails to consider the decrease in property values that will inevitably result from _the construction of the proposed powerline.The people who live along the Matanuska Valley are fortunate enough to own land that provides some of the most spectacular views in the State.The designers of the powerline have sought to protect the users of the Glenn Highway from seeing the powerline.However,the people who live in and love the Valley will be forced to see it as long as they choose to live here.The Study places a zero value on this cost as well.I expect to see an attempt to tally these cost in the final draft. More important than the inevitable loss in property value,the proposed intertie will harm,if not destroy,the quality of life for the people in the Matanuska Valley.I have chosen to live here simple because of the beauty and peace that this place provides.The fact that this country -has not been degraded by large construction projects and human settlement gives it great value to me -far more than any purchase price for property.I am told that the writers of this Study were incapable of placing a value on this "intangible."I ask you to see their incapability as a flaw in the Study and to assess the Study in that light. Finally,we are told by 'the environmental consultants (Dames and Moore)who contributed to the Study that many of the environmental effects of the proposed intertie cannot be known at this time because the route has not been determined.As a resident,I can tell you that the wildlife is rich in the Matanuska Valley and that the area is already a favorite of hunters.The introduction of access roads, wherever they end up,would bring more hunters from Anchorage and will impact the populations of moose,bear, sheep,caribou,wolf,beaver,and _birds.Furthermore,the issue of Electro Magnetic Fields (EMFs)and their effect on people has been brushed aside because the proposed route will supposedly be away from areas of human population. The Study should,however,address the effect of EMFs on animal and plant populations.Animals,just like people, use ready made access-ways for travel.It is probable .that .Species such as moose and bear will use the proposed powerline right-of-way to travel through the mountains. Thus,they will be exposed to EMF's and will eat plants exposed to EMF's.Pure concern for the animal species should warrant greater concern for this issue.But,it must also be remembered that the animals of these mountains are the food for many local residents.The cost of these animal and human health effect.must be considered to understand the full impact of the proposed project on wildlife and the environment. While this list of inaccurate and unaccounted for costs is not complete,I believe it demonstrates the failure of the Study to correctly and appropriately assess the true "price" of the proposed intertie. Power Demand The Study has overestimated the future demand for electrical power by the Petro Star oil refinery in Valdez - CVEA's primary user of electricity.The projection that Petro Star will triple or quadruple is unsupported.This estimate was based on one letter from Petro Star.When later questioned by a Daily News reporter as to the basis for this estimate,a Petro Star official stated that the estimate was "only for the [feasibility]study”.Such apparent manipulations of the data gathering process for the Study by the proponents of the intertie creates . question as to the accuracy and honesty of the process. Petro Star's productivity and profitability as a business, and thus its power demand,depends in great part on future oil prices,oil output from Prudhoe Bay,and future upgrades of the company's own power generation systems. My understanding is that oil prices are projected to be lower in the future than they have been in the recent past. Additionally,the output of oil on the North Slope is diminishing,not increasing.Given these facts,CVEA's estimate of a three or four fold increase in power demand from Petro Star is at best unrealistic. Finally,oil refineries all over the country now co- generate their own power.Such state-of-the-art technology could entice Petro Star in the years to come.If and when Petro Star does convert over to this more efficient method of producing power,the small rural communities within the CVEA will be left to pay back the loan for the _intertie.Growth projections in the Feasibility Study suggest that the population of the towns CVEA supplies will not increase significantly during the life of the proposed intertie.Thus,if Petro Star co-generates their own power,or,goes out of business,the people of Glennallen and Valdez,who do not need,and will not need, three times more power will be left to foot the bill for an unnecessary project. For all these reasons,I suggest that you re-assess and gather supplemental support for the Petro Star growthscenario. Policy. In our society we place great value on fairness.The construction of the proposed intertie would be_grossly unfair to the people of the Matanuska Valley and indeed to the people of Alaska in general. I believe that the people who gain the benefit from this project should be paying for it.While it is true that the people supplied by CVEA will pay back the State loan, they will not be experiencing many of the other real costs imposed by this project.It is the people in the communities along the Glenn Highway who will bear the brunt of this project -and gain absolutely no benefits for it.It will be me and my neighbors who will have to decide if they still want to live here in the Matanuska Valley.We will have to deal with decline in business profits and any health effects that may come to light as science learns more about EMFs.The people of Glennallen and Valdez will not have to experience these unhappy results. Furthermore,Petro Star,the big winner in this whole scenario,will get the benefit of State subsidized energy.I disagree with this result.It should not be the responsibility of the State of Alaska to provide cheap power to Petro Star. As an Alaskan,I am in favor of contributing to reasonable and fair projects which will provide cheaper power for the people in Valdez and Glennallen.I know they need cheaper power.I do,however,strongly object to subsidizing the energy needs of the oil industry.Other alternatives,including co-generation by Petro Star and _the Allison Lake hydro project,do exist.In the most realistic projections of the future of the oil industry,Petro Star will not need three times more power.The Study indicates that in a realistic scenario the Allison Lake project,or even an upgrade of CVEA's diesel generators,is the best choice.If you study the growth projections closely,I believe you must come to the same _conclusion. I hope you will consider the objections to this feasibility study I've outlined .I expect as a _public servant you will come to the most rational decision for all the people of Alaska.I expect that you will not bestow anunnecessarilylargebenefittoonelargeindustrial consumer to the complete detriment to several rural communities.I hope you will hear the voices against this intertie and represent us,too.Thank you for your consideration. Sincerely, Pooky Mile Rosalyn H.McLean General Delivery Sutton,Ak.99674 (907)745-7000 February 25,1994 Herv Hensley .n&CSe.vED Acting Director,Division of EnergyDepartmentofCommunityandRegional Affairs MAR 2.1994 333 West Fourth Avenue,Suite 220 Anchorage,Alaska 99501 .DIVISION OF ENERGY/DCRA Dear Mr.Hensley: We appreciate the opportunity to comment on the draft Copper Valley Intertie FeasibilityStudy.Our organizations represent more than 10,000 Alaskans,many of whom are greatlyconcernedovertheenergypoliciesinthestateofAlaska. Our organizations commissioned Mark Foster &Associates to do an independent review of thestudy,a copy of which is enclosed.We share the conclusions of this study,particularly thattherearelessexpensivealternativesthantheInteritietosupplywhatappearstobeCopperValleyElectricAssociation's real need for electricity in the future. Thank you for considering this review in the development of the final feasibility study.If youwouldliketodiscussanyaspectsofourreview,please feel free to contact Cliff Eames at 274- 3621. Sincerely, okip Roy.Nelchina Users'Gr CLHAlaskaCenter for the EnvironmentCbensen Chris Rose, Alaska Citizens for a . Responsible Energy Development _tb,Pon,atedonFord,tepheén Wells,National Outdoor Leadership School The Alaska Wildlife Alliance es 'Kaderson,-CfebiosSuttonCommunityCouncilickaloonCommunity Co enclosed:study review ce:Honorable Walter J.Hickel,Governor of Alaska : Honorable Edgar Blatchford,Commissioner,Dept.of Community and Regional AffairsMembersoftheAlaskaStateLegislaturethalwe RP-94-02 REVIEW.. OF -THE DRAFTCopperValleyIntertieFEASIBILITYSTUDYDated:January 19,1994 -;Prepared by:Mark A.Foster,PE.oe_Submitted to:"Alaska Center for the Environment _February 25,1994 MAFA RP-94-02 The purpose of this report is to review and comment on the Draft FeasibilityStudy(herein referred to as the DFS)of the Copper Valley Intertie Project,prepared by R.W.Beck &Associates for the Division of Energy,AlaskaDepartmentofCommunityandRegionalAffairs,dated January 19,1994. Conclusion: ..the best answer is the one that,undera broad range of contingencies or scenarios about the future,provides a good solution..1 The proposed Copper Valley Intertie does not appear to be the best "least cost"alternative to supply electricity to the customers of Copper Valley Electric Association. The proposed Copper Valley Intertie only appears as the "least cost"alternative under a narrow range of assumptions which do not appear likely at the present time.Unless a number of these critical assumptions can be adequately supported,the proposed intertie does not appear to be a prudent investment. The critical assumptions include:projected demand for energy,the capital,operations and maintenance costs of . the proposed intertie,the costs of diesel generated power, and the cost of the Allison Lake Hydroelectric Project. The prudent approach appears to be pursuit ofenhancementstotheexistingSolomonGulch Hydroelectric Project,including Allison Lake,andreplacementofexistinginefficientdieselgenerating unitswithmoder,efficient units. lEnerey Aftermath:How we can learn from the blunders of the past to create a hopeful ene future,by Lee,Ball,and Tabors,Harvard Business School Press,1990,page 223. **DRAFT**page 2 February 25,1994 MAFA , RP-94-02 Introduction: Due to the number of assumptions that appear biased toward increasing thepaperfeasibilityoftheintertiealternativeinthetheDraftFeasibilityStudy(DFS), this review will recast the scenarios to provide a "mid range”basket of scenarios along with a sensitivity analysis of critical assumptions. The section entitled Review of the Draft Feasibility Study lists and explains anumberofconcernswiththeDFSandindicateswhichassumptionshavebeenadoptedforthepurposeofdevelopingthe"mid range"scenarios contained in this report. The section entitled Utility Rates discusses the rate implications of the alternatives and concerns raised about how to frame the comparisons between alternatives including: ehow to treat the $35 million no-interest "loan"from the State of Alaska ehow to treat the 6.4¢/kWh charge associated with power from the Solomon Gulch Project The section entitled Mid Range Scenario provides a summary of the assumptions used in the economic analysis. Finally,a technical appendix containing summary and supporting economicanalysisisattachedforreference. Discussion: The purpose of the feasibility study is to determine which alternative,from the point of view of the citizens of the State of Alaska,is most likely to supply the power and energy requirements of Copper Valley Electric Association for the least cost under a broad range of reasonable scenarios about the future. It appears that the proposed intertie project does not meet that criteria given the slate of likely scenarios developed in this report. In summary the economic analysis suggests that the Allison Lake Project in conjunction with the replacement of existing inefficient diesel generating unitswithnewmoreefficientunitsislikelytoprovidealeastcostplantomeetthe needs of Copper Valley Electric Association's customers.The results are summarized in the Summary of Economic Analysis Results;Revision 1.1 to DFS schedule attached. **DRAFT**page 3 February 25,1994 MAFA RP-94-02 Review of the Draft Feasibility Study (DES):© In reviewing the Draft Feasibility Study (DFS),several areas of concern emerged.They include: 1.Demand Forecast a.Petro Star demand can substantially drive which alternative appears tobethe"least-cost."_. 1) 2) 3) 4) 5) Medium Low Case presumes Petro Star will roughly double energy and demand requirements from 1993 to 1997. Medium High Case presumes Petro Star will roughly quadruple energy requirements and more than triple demand requirements by 2004. Given the sensitivity of the computer modeling to the Petro Star demand forecast,a detailed analysis of Petro Star's potential demand for power and its ability to self-generate power is essential. The possibility that Petro Star will be able to self-generate needs tobecarefullyexaminedsince:a)Its generator can be sized for its specific needs when they arise. b)It will not have to bear a portion of CVEA's line loss. c)It may be able to utilize some of the waste heat from its-_generators. d)It may be able to burn the fuel it produces (avoiding fuel transport and distribution costs which CVEA must pay). One way to assess whether or not Petro Star has any substantial plans for expansion is to require them sign up for a take or pay contract with CVEA prior to a major capital expenditure predicated on PetroStar "plans."The terms of such an agreement could help protect CVEA against a potential over investment. b.The feasibility study extends all the loads projected to occur in 2017 outto2047.This appears optimistic given the dependence of Valdez on oil terminal operations.This biasis evidentin each of the demand forecasts. 1)According to the Department of Energy Report referenced in the DFS?,the Trans Alaska Pipeline System (TAPS)will be shut down in: a)2009 under a "most likely”case; b)2011 under a "high reserves"case; 2DOE Report "Alaska Oil &Gas:Energy Wealth or Vanishing Opportunity?"(DOE/OD/0150-H1,January 1991).See DFS at page VIII-5. **DRAFT**page 4 February 25,1994 MAFA RP-94-02 ¢)2025 under an "ANWR Multiple Field High"case?. 2)The Petro Star refinery is assumed to close in 2013 under the low load forecast in the DFS.In terms of continued TAPS operations, the low load forecast in the DFS corresponds roughly to a "high reserves"case projected by DOE. 3)Under the so called "medium"and "high"forecasts in the DFS,the demand is effectively projected flat from 2017 to 2047, a)38 years beyond DOE's "most likely"projections for the continued operation of TAPS.- b)22 years beyond DOE's most optimistic case for ANWR development. This creates a "phase shift"as follows: DOE High =DFS Low DOE High +ANWR High =DFS Medium-Low? 22?=DFS Medium-High? Thus the demand forecasts included in the DFS appear optimistically a. characterized.In order to compensate for this "phase shift",the medium- high and medium-low DFS forecasts will be included in this review as the high and medium cases respectively.. WorldOilPrice &Diesel Fuel A r DFS assumes estimated mid-year 1993 price for West Texas Intermediate of $19.00 per barrel.It has been between $14-$16 for the past several months.In addition,recent projections by Kidder,Peabody "has WTI recovering by $1-2/bbl from the current $15/bbl level early in the year, then drifting down through most of 1994 and averaging about $15/bblfortheyear."Given these projections,it appears that the DFS may have used an inflated starting price for the comparisons. The DFS assumes 1993 prices for diesel fuel at:Valdez $0.70 /gallonGlennallien$0.75 /gallon based on actual prices paid at some time in 1993. 3See Figure 3-21,DOE Report DOE/OD/0150-H1.Even if one assumes that congressionalapprovalofaleasesaleisdelayedbeyondwhatisprojectedintheDOEreport,the mostoptimistichighrecoverycaseforANWR(6.25 billion barrels of economically recoverablereserves)would only extend the operating life of TAPS by about 10 years (page 3-73).4See Oil &Gas Journal,February 7,1994,page 1 of the "Newsletter." **DRAFT**page 5 _February 25,1994 MAFA RP-94-02 Meanwhile,actual prices paid by Copper Valley for deliveries inDecember1993were?: Valdez $0.6123 /gallonGlennallen$0.6423 /gallonAgain,this highlights that the DFS may have establisheda false startingpriceforcomparisons. c.The Draft Feasibility Study assumes the real price of diesel for CVEAwillescalateatapproximately: 1)Low 0.03%per year2)Medium 1.73%per year3)High 2.45%per year Meanwhile,long term price trends in the real cost of crude oil suggestthattheso-called "low"fuel projections are more reflective of the actual historic data looking back over similarly long time horizons®. Furthermore,there is evidence to suggest that the trend for the pastfortyyearshasbeenadeclineintheinflationadjustedpriceforrefinedproducts'. This review will include the DFS low and medium fuel escalationcasesrecastasthemediumandhighfuelescalationcases.- In addition,this review will use the December 1993 prices paid for diesel fuel as a starting point for fuel costs. 3.DiscountRate a.The DFS uses a 5%real discount rate.The proper discount rate is one that reflects the investment cost to Alaskans of the money sunk into the project.One reasonableness measure for Alaskans would be to compare whether or not the return on the investment was equal to or greater than an equivalent investment in the Permanent Fund.Given the Permanent Fund's average real return of 5%over the past several years and a >From Copper Valley Electric Association tariff filings with the Alaska Public Utilities Commission in 1994. 6See for example "An OPEC Obituary”,by Arlon R.Tussing,in The Public Interest,Number 70, Winter 1983,at page 21: History offers some empirical support for the viability of a long term world oil price in the $10-to-$18 range [1982 dollars].Over the past 110 years,the average price in 1982 dollars has been almost exactly $13 per barrel and,despite an average constant-dollar prime fluctuation of more than 20 percent per year,no long-term trend can be detected.(The average 1982-dollar price between 1871 and 1925 was $12.96 per barrel,and the average price between 1926 and 1980 was $13.04 per barrel.)7See "Energy Security and Policy:Analysis of the Pricing of Crude Oil and Petroleum Products",GAO/RCED-93-17,March 1993,Figure 1.6:Retail Gasoline Prices,adjusted for inflation,1950-90, which shows retail gasoline prices have declined by over 20%in real terms from 1950 to 1990. **DRAFT**page 6 February 25,1994 MAFA RP-94-02 1) 2) presumption that it will continue,an initial estimate of 5%appears reasonable.Nonetheless,given the Permanent Fund Corporations recent projections for a real return of between 4.5%and 3%,a sensitivity analysis would be appropriate to check the robustness of the "least-cost" alternative to a slightly lower discount rate. Copper Valley Intertie Alternative Capital Cost CVEA has expressed concern to the feasibility study team that the capital costs were too high.CVEA "implied that they would consider unreasonable any design selections which are a matter of philosophical differences and which cost more but buy nothing,e.g.,longevity,lower maintenance costs,reliability."8 Unfortunately,CVEA's views,if accurately reflected in the summary, reveal what might be characterized generously as a misunderstanding of the underlying purpose of a feasibility study.The purpose of a feasibilitystudyistoidentifyaleastcostalternativewithaconsistentbasisof comparison between the alternatives.CVEA appears to believe that the intertie is their best alternative and the feasibility study should be manipulated (by lowering capital costs and ignoring the operating andmaintenanceimplications)to reach this result.Consequently,anyassumptionsthatCVEAhassuppliedforthepurposesofdetermining Intertie feasibility must be reviewed in light of this bias. It appears that the feasibility study team has ceded to CVEA's desire to lower the capital cost in several intertie design decisions which should result in higher operations and maintenance costs for the intertie alternative compared to industry standards.The impact of these design decisions does not appear to be reflected in an appropriate upward adjustment in the O&M allowances in the economic analysis.- Ice and snow design loading conditions have been reduced from the original recommendation without adequate empirical evidence.It appears to be a "compromise"between more conservative margins ofsafetyandadesiretokeepcostsdown'.In addition,Power EngineersInc.suggest that maintenance is a factor to consider in decidingwhethertoacceptlowerloadingcriteriaandreliability.This 8See DFS,Appendix E:Technical Review Meeting Summary,page 1.9See DFS,Appendix E,Technical Review Meeting Summary,pages 2 and 3 regarding extremeloadingcriterion. **DRAFT**page 7 February 25,1994 MAFA 3) 4) 5) 6) RP-94-02 additional exposure to risk does not appear to be factored into costestimatesforoperationsandmaintenance.The O&M estimates appeartobeonthelowendoftherangeofcomparablespresentedinthestudy.Given these additional measures to keep cost down,it wouldappearanO&M estimate from the mid range of empirical evidence |may be too low.No explicit adjustment has been made.O&M is varied from the DFS estimates in the medium,and high cost intertiescenariosasapercentageofthetransmissionlineconstructioncost. Engineers recommended a standard communications link to assist with clearing faults.CVEA requested that no dedicated communications system be included.This will either reduce reliability or require someadditionalcapitalexpendituretocompensate.A capital cost element of$250,000 has been added to the medium and high cost intertie scenarios. No condemnation proceedings have been included in right-of-way acquisition costs despite acknowledgment at technical meeting in July that Chickaloon acquisition "may not be easy."Right-of-way acquisitions may be under reported in the DFS.No explicit adjustment has been made in this review. The DFS used: ...a median 40%overhead [rate for labor]largely based on discussions with the prospective owner,CVEA,that streamlined contracting would be the rule,but tempered by the fact that the rate would be pushed up if schedule and bonding requirements dictated a joint venture or multiple subcontracts.10 Given that the overhead rate on the Bradley Lake Transmission Line was close to 50%and the projection of "streamlined contracting”may not prevail,it seems appropriate to test the sensitivity of this assumption. An increase in overhead from 40%to 45%appears to increase the average fully loaded labor rate by approximately 2%11.No explicit adjustment has been made in this review. The DFS indicates that it performed a reasonableness check on total labor effort by consulting two line contractors for an independent estimate:; a)These estimates varied widely: i)110,000 -140,000 person hours (820 ph/mile -1045 ph/mile) 10See DFS,page VI-8.11]n the medium construction cost case,this would increase labor by approximately $656,000 and total project cost by $740,000., **DRAFT**page 8 February 25,1994 MAFA RP-94-02 ii)250,000 person hours (1866 ph/mile).!2 b)The estimate used in the DFS is roughly 136,000 person hours (1015 ph/mile). c)Especially in light of the wide variation of the independent estimates,it may be more appropriate to take a mid-point of the estimates of labor effort and vary them as part of the sensitivity analysis to get a less biased picture.Otherwise,use of the DFS figure of 136,000 person hours effectively ignores the second _estimate and relies upon the lowest quote as a reasonableness check.Furthermore,the wide variation of the independent estimates would suggest a substantial and increased labor contingency would be in order. 7)The per mile estimated cost of the CV Intertie for Route Alternative D is$254,000/mile including clearing and contingencies.This compares with the mileage weighted average for the sample of projects contained in Table VI-6 (which presumably contain no owner contingency)of: $409,000/mile.(See Schedule Review Construction Cost for Reasonableness;Review Table VI-6,attached). DFS Table VI-5 compares cost components across "recent Alaskan projects."Presumably these projects were selected for some comparability.The mileage weighted average for the Table VI-5 projects is $514,000/mile,more than twice as much as the DFS estimate for the intertie. The DFS states "this [$254K/mile]unit cost is in line with escalated |historical costs!5.It appears more accurate to say that this represents the _low end of the historic experience...and 62%as much as the average of Alaskan projects listed in Table VI-6. Both the per mile construction cost and the labor hours reasonableness checks suggest the construction cost estimate provided in the DFS represents the lower end of the continuum of likely construction costs.It would appear.appropriate to provide a "medium"construction cost estimate based on average independent labor estimates and averagehistoriccostsforcomparableprojects. Please see schedule INT-1 for a summary of the Low,Medium,and High project cost estimates. The project cost estimate provided in the DFS is used in Revision 1.1 to DFS. 12See DFS,page VI-10.13See DFS,page VI-12. **DRAFT**-paged February 25,1994 MAFA .RP-94-02 1) In Revision 1.0,the DFS estimate is termed the "low cost intertie"and themediumandhighintertieprojectcostfiguresareincludedinscenarios to test the sensitivity of the modeling exercise to those parameter.The Medium project cost estimate uses the following assumptions:1..Labor Hours=average of independent quotes-2.Heavy Helicopter Hours=increased from DFS Exhibit C-1 inproportionwithlaborhours Fully Loaded Labor Rate =$125/hr Fully Loaded Heavy Helicopter Rate =$3341/hrInclude$250K for communications systemEngineeringcalculatedat3%of Transmission Line Constructiontotal(line C4). Construction Management at 6%. Owner Costs at 4%AASw9NOperations &Maintenance Costs Static VAR Compensator (SVC):An SVC has been indicated as necessarytopermitreliabletransfersinexcessofaboutISMW.The cost of such an addition would appear as an O&M expenditure in roughly the year when 15MW of load transfer is forecast.This cost (around $5.6 million in 1993)has not been included in the O&M Stream at this juncture because of "the uncertainty of the date at which it would be required." Ironically,the high demand scenarios which appear to support the intertie may require the SVC,but its cost has not been included in a feasibility study that runs to 2047 because of "uncertainty.” 2)The DFS uses Table VI-8:Annual Operation and Maintenance Costs,Steel H-Frame Construction Alternative,(1993 dollars)as the basis for the numbers in the economic analysis. a)This schedule assumes that the Steel H-Frames will be replaced at theaveragerateoftwoperyearforyears1-20 and one per year thereafter.There is no evidence presented to support a contention that the rate of replacement should decline.For the purposes of this review, replacements are held constant at $50,000 per year over the life of thelineinthelowcostintertiecase.b)The economic analysis presentedin AppendixJ appears to contain anumericalerror.It uses a figure of $269K for intertie O&Min the year 2017.Table VI-8 suggests that this figure should be $346K. c)The DFS economic analysis projects the incorrect figure of $269K out to 2047.The DFS analysis thus projects an average annual O&M of $255K over the 50 year life of the line.Substituting what appears to be the correct figure $346K and projecting that out from 2018-2047,the average annual O&M over the life of the line would be $314K. **DRAFT**page 10 February 25,1994 MAFA *RP-94-02 d)Finally,given that O&M is projected to increase over the life of the line, the DFS flat projection from year 2017 through 2047 under reports the O&M costs developed in Table VI-8.Projecting the trend of increasing O&M over the 2017-2047 time period,the average annual O&M would be around $329.Thus these two adjustments would increase the O&M by 22%over what is included in the DFS economic analysis. 3)The DFS suggests its O&M estimates are reasonable given a samplewhichincludesTyeeLake,Swan Lake,and discussions with HEA". a) b) c) d) Tyee Lake O&M is estimated at 1.1%of construction cost. Construction cost was $438K/mile.Access is poor,terrain is mountainous. O&M per mile =4.8K. Swan Lake O&M is estimated at 0.3%of construction cost. Construction cost was $667K/mile.Access is poor,terrain is rolling. O&M per mile =2.0K. HEA estimates O&M between 0.5%and 1.0%of construction cost for lines in its area.Construction cost for the Bradley Lake was $530K/mile.Access is poor,terrain is mountainous. O&M per mile =4.0K. The DFS Copper Valley Intertie O&M per mile =2.3K,clearly at the low end of the sample range cited for support.The average O&M per mile for the sample cited is roughly 3.6K.For this intertie,that would suggest a mid-range estimate for O&M would average around $482K/year (3.6K /mile *134 miles;approx..54%higher than the DFS estimate of an average of $314K/year). Thus,this review has adjusted the O&M estimates of DFS Table VI- 8 based on the following annual average O&M costs over the life of the line (all 50 years)as a percentage of the transmission lineconstructioncost: Low Intertie Cost:Adjust DFS for math error (0.97%over 50 year life of line) Medium Intertie Cost:Use 1.0% High Intertie Cost:Use 1.0% 4)The Intertie case assumes that CVEA will reduce its labor costs by $560,000 each year once the intertie is built (6 full time positions).Unable to independently verify this estimate.This adjustment has beenacceptedwithoutmodificationinthisreview.Itis important to note thatthissingleassumptiondecreasestheIntertiepresentvalueby-approximately $8,010,000.° 14See DFS,pageVI -18. **DRAFT**page 11 ;February 25,1994 MAFA RP-94-02 c.Purchased Power Need to verify whether economy energy sales figures are reasonable.(25.8 mills per kWhin 1998 for fuel +O&M component). d.Probability of Diesel Generation-under Intertie Alternative a. The DFS assumes that once the intertie is operational (1998)there will benomoredieselgeneration.This assumes that the intertie between Glennallen and Valdez performs without failure.This intertie has experienced outages over its life,at least one lasting several months. It appears that if some diesel generation were to be included in the Intertie case,after the intertie is operational,as is likely to occur given historical evidence,the intertie alternative may become even more expensive relative to the other alternatives. Other alternatives may require an adjustmentin the amount of dieselgenerationaswelltoaccountfortheprobabilitiesthattheGlennallen-Valdez intertie may experience outages. Diesel Alternativ Unable to independently verify that CVEA will need an additional 3 fulltimepositions($291,000)for the diesel scenario for an additional shift.It appears this may be double counting the labor required for diesel operations.Recommend that R.W.Back review whether the "fixed operating costs,including labor"of $12 per kW per year for the new.diesel generators includes this particular labor component or not!5.ThisadjustmentrepresentsapresentvalueincreaseintheDieselAlternativeof$3,945,000. DFS assumes an installed cost of $820/kW for a 2200 kW unit based on vendor quotes.Given the relatively widespread installation of CatgeneratorsinAlaska,the use of a 15%contingency appears high.Furthermore,this estimate appears high compared to recent installations and recent studies in Alaska. The 1990 Least Cost Plan for Copper Valley Electric Association used a figure of $470/kW.Even if escalated at 5%per year to 1993,the estimatebecomes$544/kW,2/3rds of the figure used in the DFS. 15See DFS,page IX-12. ""DRAFT*page 12 February 25,1994 MAFA RP-94-02 Nome installed a 3.7 MW Cat 3616 generator,including building and switchgear,for $740/kW in 199116,Escalated at 5%per year to 1993,the estimate (including building)becomes $816/kW.The comparable DFS estimate is roughly $1029/kW ($1,765K for 2200kW +$500K for bldg). Even given the difference in the size of the units under consideration,it appears that the DFS may be overestimating the installed cost of new diesel generators,particularly given that installations in Glennallen and Valdez should be less costly than those in Nome due to differences in road and port access. The comparisons presented in this review will use the relatively high DFS diesel capital costs. Assuming the Cat 3608 Generator capital cost is $745 per kW of ratedoutput(use a 5%contingency instead of 15%)will resultin a reductioninpresentvalueforthemediumdemandcasesroughlyasfollows:All diesel case =$612,000. Allison Lake case=_$599,000. The DFS uses O&M figures for diesel generators which appear highcomparedtootherAlaskanutilities.The DFS useda figure for variableO&M of $0.01 per kWh.(Assumed to be non-labor) Nome Joint Utilities has had variable Non-labor O&M estimated between 6 and 7 mills/kWh!”.Adjusting to 1993 dollars,variable O&M will be in the range of 6.6 to 7.7 mills/kWh.The scenarios presented in this review will use 7.5 mills/kWh as a reasonable estimate. DFS assumes that the existing units will be replaced as they arescheduledfortheirnextoverhaul.This introduces a bias against dieselgenerationasthisapproachreplacesthemostefficientunitsfirst, leaving the least efficient units as part of the diesel generation mix against which the other alternatives will be compared. For the purposes of this review,the diesel alternative developedin theDFSwillbeused. However,it would be appropriate to evaluate the economics of the retirement of inefficient diesel units prior to retiring the more efficient units. 16See "Economic Analysis of Coal-Fired Power Plants to Serve Nome,Kotzebue,and the Red DogMine”by Analysis North,1991,pages 5-40,5-41.17See "Economic Analysis of Coal-Fired Power Plants to Serve Nome,Kotzebue,and the Red DogMine”by Analysis North,1991,page 5-37.. *"DRAFT**|page 13 | February 25,1994 MAFA , . RP-94-02 6.Coal Alternative The coal alternative has not been reviewed. 7.lison iv a.Asin the diesel alternatives,the DFS assumes that the existing dieselunitswillbereplacedastheyarescheduledfortheirnextoverhaul.This introduces a bias against this alternative as it relies in part upon dieselgeneration.This approach replaces the most efficient units first, leaving the least efficient units as part of the diesel generation mixagainstwhichtheotheralternativeswillbecompared. For the purposes of this review,the diesel retirements and dispatchdevelopedintheDFSwillbeused. However,it would be appropriate to evaluate the economics of the retirement of inefficient diesel units prior to retiring the more efficientunits. b.Inthe DFS low and medium-low demand growth cases,a labor deduction of $146,000 is taken when Allison Lake comes on line.Itis unclear why this deduction is not also taken for the DFS medium-high case.This appears to represent a present value difference of $1,875,000. 8.Silver Lake Hydroelectric The Silver Lake Alternatives have e not been reviewed. 9.Other Alternatives The 1990 Least Cost Plan for Copper Valley Electric Association found that some alternatives to expand the capacity of Solomon Gulch appeared attractive.They did not appear to receive any mention in the DFS.At the very least,the list of prior preferred alternatives should at least get some mention under a discussion of preliminary screening to explain why they looked good in 1990 but do not even warrant a mention in 1993,let alone development into an alternative to consider in this study. One example of a project that should at least be discussed is the proposal'contained in the 1990 Stone &Webster Study to add an inflatable rubber dam to the existing Solomon Gulch dam. **DRAFT**page 14 February 25,1994 MAFA RP-94-02 ility R The electric rates that will result from each of the alternatives should generally reflect their relative cost in the economic analysis of present values. If,however,one alternative has access to lower cost financing relative to other alternatives,the lower cost financing will drive the rate projections lower for that alternative compared to the others.The other exception is that the rates in the Intertie case for purchasing power from the Railbelt are somewhat higher to reflect the overheads and profits that the Railbelt utilities will assign to their sales of energy. All other things being equal,it appears that the Allison Lake project in combination with the use of more efficient diesels will result in lower rates compared to other alternatives. Related Issues: 1.Some have argued that the proposed Intertie will result in lower rates than the other alternatives due to the State of Alaska donation of a $35 million, 50 year,no interest "loan.” Adding or withholding a $35 million,50 year,no interest "loan"is equivalent to giving or withholding a $27 million grant from your favoritecharity.18 With the grant,your charity will be a stunning success.Without it,it ceases to function.This is simply a self-fulfilling prophecy. In effect,if one gives the $27 million grant to one alternative and not the others in a comparison,one is simply arbitrarily picking the winner for considerations which are not related to the underlying economics of the project.Such an argument generally eviscerates the reason to conduct a feasibility study in the first instance. The DFS appropriately provides a rate comparison between the Intertie and the Allison Lake Project which reflects both projects having access to this state grant. Since the Allison Lake Project is likely to require considerably lessadditionalcapitalbeyondthenointerest"loan"compared to the proposedIntertie,the state grant is more effectively leveraged if applied to the 18See the attached schedule entitled "Copper Valley Intertie:Analysis of $35 million,50 year,nointerest'loan™.Essentially the so-called "no interest loan”is equivalent to a $35 million,50 yearloanataninterestrateof8.5%plus a grant of $27 million. In annual payment terms the difference is over $2 million a year. **DRAFT**page 15 _ February 25,1994 MAFA RP-94-02 Allison Lake Project.That is,the Allison Lake Project will result in evenlowerratestoCVEAcustomersthantheIntertiealternativeevenifboth projects are essentially equal in a "least cost"level comparison. Some have argued that the Allison Lake Alternative has been undervalued in comparisons that do not include the 6.4¢/kWh payments for energygeneratedfromtheSolomonGulchProject(pursuant to the Four DamPoolPowerSalesAgreement). This argument is not persuasive due to the new circumstances that arise from the Allison Lake Hydroelectric project. If AIDEA sought to have the Four Dam Pool charge apply,it wouldsimplyrepresentatransferpaymentfromCopperValleyElectric Association customers to AIDEA which would not represent any net change in value to the State of Alaska or its citizens.It basically amounts to a surcharge on CVEA customers simply for the privilege of pouring more water through Solomon Gulch.Under this circumstance,the CVEA customers could pay for Solomon Gulch several times over the course of the Four Dam Pool Power Sales Agreement. CVEA should be arguing (both on legal and public policy grounds)thatthewaterfromAllisonLakeisnotpartoftheoriginalprojectandthat changed circumstances warrant a separate treatment of the powergeneratedfromSolomonGulchasaresultofprojectswhichsupplementitswatersupply. Mid Range Scenario: Based on the preceding review of the Draft Feasibility Study,a mid range scenario was developed around which additional scenarios and sensitivity analyses are presented.The summary of results is presented in CVEA,SummaryofEconomicAnalysisResults,Revision 1.1 to DFS,attached. The Economic Assumptions for the mid range scenario are summarized below: 1.The expected initial year of commercial operation for the Intertie is 1998. The study period begins in 1993 and extends through 2017.Costs are then projected through an extended study period from 2018 through **DRAFT**page 16 February 25,1994 MAFA RP-94-02 2047 to cover the expected economic life of the intertie.Costs are held constant after the initial 20-year study period. All costs are stated in 1993 dollars.Fuel costs are assumed to escalate at real rates corresponding to the price projections indicated. The discount rate of 5%is used consistent with the DFS. The base price of #2 diesel fuel is based on CVEA's December 1993 reported purchase price:Valdez $0.6123/gallon Glennallen $0.6423/gallon - The average annual rates of increase for fuel are: 0.03%Medium 1.73%High The economic lives for the alternatives are: Intertie 50 years Base Load Diesel 20 years New Hydro 50 years Coal-Fired Power Plant 30 years Buildings,Switchgear 30 years Capital costs are assumed to be recovered over the economic life of the investment at an annual interest rate equivalent to the assumed discount rate. The capital and operations and maintenance costs of the DFS,adjusted to reflect corrections to numerical errors,are included as the low cost intertie case (Capital =$45,930,519,O&M average =$329,000/year) which is reflected in the Schedule entitled "Revision 1.1 to the DFS." Sensitivity Analysis: The medium estimated cost of the Intertie,as shown in Schedule INT- 1,is $61,948,830 in 1993 dollars.Annual operations and maintenance costs of the Intertie are as shown in Schedule I-2 and average 0.75%of construction costs,or an annual average of $per year over the life of the line.The high cost case is $74,377,775 with an operations and maintenance average of 1%of construction costs,or an annual averageof$per year over the life of the line. The DFS capital and O&M estimates are used in the Summary of Economics Analysis Results,Revision 1.1 to DFS.The sensitivityanalysisiscontainedinSummaryofAnalysisResults,Revision 1.0 to DFS. **DRAFT**page 17 February 25,1994 MAFA 10. 11. 12. 13. 14. 15. 16. 17. 18. RP-94-02 A Static VAR Compensator should be included in the sensitivityanalysisoftheintertiecasesasa"supplemental capital project"at apriceof$5.6 million.If one assumes this is added in 2016 for example,it would add roughly $1,737,000 to the present value of the intertiecases.This has not been included in any scenarios in this review. The estimated capacity,energy generation capability,installed cost andannualoperationandmaintenancecostsforeachofthealternative generating resources are summarized in Schedule C-1. Existing diesel generators are replaced per the DFS.Fixed operationandmaintenancecostsassociatedwithdieselgenerationdonotchangewhenadieselgeneratorisreplaced. Station use power requirements for diesel generating plants is estimated to be 3.66%of net diesel generation. This review has been unable to independently verify the staffing level changes assumed by the DFS based on CVEA's advice.Those assumptions are retained here. Variable operations and maintenance expenses for diesel generators is 30 mills /kWh for existing diesel generators and 7.5 mills/kWh for new diesel generators.Fixed operations and maintenance expenses for new diesel generators is $12 per kW-year. Transmission losses over the intertie and the existing Valdez to Glennallen transmission line are 3%of the power transmitted over each line. Energy purchased from the Anchorage area by CVEA is priced at aneconomyenergyrateof25.6 mills per kWh!9 in 1998 and is assumed _to escalate at the same rate as diesel fuel.A capital depreciation component of 3 mills/kWh is added to the economy energy rate beginning in 2005. The analysis is prepared from the overall perspective of the State of Alaska.Transfer payments between utilities,such as for wheeling the power over MEA lines to CVEA from the Anchorage area are notincludedintheeconomicanalysisportionofthestudy.Transfer payments are considered in the Estimate Price of Power discussion.This is consistent with the appropriate framework established in the DFS. 19This economy energy rate includes a fuel and an operations &maintenance component.It does not contain margins. **DRAFT**page 18 February 25,1994 CVEA Summary of Economic Analysis Results Revision 1.1 to the DFS Cummulative Present Value of Comparable System Costs 93 $0 Scenario Diesel intertie Allison Lake i Low Load Growth Medium Fuel $31,329 $54,955 High Fuel $35,588 $57,731 Medium Load Growth Medium Fuel $58,142 $62,404 $57,449 High Fuel $67,496 $66,912 $61,714 | High Load Growth Medium Fuel $72,774 $72,151 $65,098 High Fuel $85,871 $78,517 $70,180 Index Present Values to Medium Load Growth Medium Fuel Least Cost Plan OFS Scenario DFS Diesel Intertie Allison Lake | | Low Load Growth Medium Fuel 0.55 0.96 High Fuel 0.62 1.00 Medium Load Growth Medium Fuel -O1 09 .00 High Fuel 1.17 .16 1.07 {High Load Growth Medium Fuel 1.27 1.26 .13 High Fuel 1.49 1.37 22 2:16 AM Page 1 CVEA iIntertie Feasibility Review $90,000 + $80,000 $70,000 $60,000 $50,000 El Allison Lake CJ Diesel $40,000 E3 intertie $30,000 PresentValue(1993$000)$20,000 $10,000 $0 MedDMedF -MedDHiF HiDMedF HIDHIF Alternative Demand and Fuel Escalation Scenari 2:23 AM . 2/25/94 Copper Valley Intertie Analysis of $35 million,50 year,no interest "loan* "No Interest"8.50% Loan Loan Difference Present Value $35,000,000 $35,000,000 ($26,904,083) Annual Payments ($700,000)($3,026,217).$2,326,217 Value of 50 years of the difference in Annual Payments Discount Rate= 0.0%($116,310,844) 2.0%($73,098,123) 4.0%($49,972,221) 6.0%($36,665,506)|: 8.0%($28,457,739)|| 8.5%($26,904,083) 10.0%($23,064,009) No interest loans are the flip side of the claims associated with Lottery Pay Out Schemes You can win $10,000,000 (if you ignore interest) paid out at $250,000 a year for 40 years "No Interest”8.50% Loan Loan Difference Present Value .$10,000,000 $10,000,000 ($7,171,370) Annual Payments ($250,000)($883,820)$633,820 2:24 AM 2/25/94 8:28 AM 1.10 1.08 1.06 . 1.04 1.02 1.00 0.98 0.96 0.94 CVEA Intertie Feasibility Present Value Comparison Allison Lake Diese! .Medium Demand;Medium Fuel Intertie 2/22/94 1.10| 1.08 + 1.06 7 1.04 + 1.02 + 1.00 7 0.98 + 0.96 7 CVEA Intertio Feasibility Present Value Comparison 0.94 8:31 AM Allison Lake Diesel Medium Demand;High Fuel Intertie 2/22/94 CVEA intertie Feasibility Present Value Comparison 1.12 7 1.10 + 1.08 + 1.06 + 1.04 + 1.02 + 1.00 + 0.98 + 0.96 + 0.94 Allison Lake Diesel Intertie High Demand;Medium Fuel 8:35 AM 2/22/94 8:46 AM CVEA Intertie Feasibility Present Value Comparison Allison Lake -_+_'Diesel High Demand;High Fuel Intertie 2/22/94 CVEA Intertie Feasibility 1.60- 1.40- 1.20- 1.00- 0.80+ 0.607 0.40- 0.20- 0.00- MedDMedF Diesel MedDHiFPresentValueIndex - Intertle Allison Lake HIDHIF HiDMedF 6:07 PM 2/21/94 Economic Assumption Summary Discount Rate 5.00% Base Price of Diesel Valdez $0.6123 |[December 1993] Glennalien $0.6423 |[December 1993] Real Escalation in Fuel &Pu rchase Power (above inflation) Medium 0.03%|per year High 1.73%|per year intertio Project Cost [See schedule INT-1]O&M Low|$45,930,519 $329,000 Medium}$61,948,830 $471,000 High}$74,337,775 $581,000 Existing Diesel Generators Variable O&M $0.0300 |kWh New Diesel Generators Variable O&M $0.0075 |kWh Fixed O&M $12 ikW-yr Net Output 96.34%Station Use 3.66% Purchase Power (1993$) Initial Cost $0.0254 |per kWh (in 1998)[See Schedule P-1] Capital Depreciation $0.0030 |per kWh (in 2005) Estimated Economic Life Intertie SOlyears. New Diesel Generators 20}years Tank Farm 30!years Buildings 30|years Hydroelectric 50|years Coalfired PP 30\years 10:57 AM Economic Assumption Summary Discount Rate 5.00% Base Price of Diesel Valdez $0.6123 |[December 1993] Glennallen $0.6423 |[December 1993] Real Escalation in Fuel &Purchase Power (above inflation) Medium -0.03%{per year High 1.73%|per year Allison Lake Project Cost'O&M Low]$29,016,000 $255,600 Medium|$32,240,000 $284,000 High}$40,300,000 $355,000 Existing Diesel Generators Variable O&M $0.0300 {kWh New Diesel Generators Variable O&M $0.0075 {kWh Fixed O&M $12 |kW-yr Net Output 96.34%Station Use 3.66% Purchase Power (1993$) Initial Cost $0.0254 |per kWh {in 1998)[See Schedule P-1] Capital Depreciation $0.0030 per kWh (in 2005) Estimated Economic Life Intertie 50!years New Diesel Generators 20/years Tank Farm 30|years Buildings 30lyears Hydroelectric 50]years Coalfired PP 30\years 2:19 PM .2/20/94 Schedule C-1 Estimated Costs and Operating Characteristics of Resource Options Available Annual Capacity Annual Energy Capability Installed O&M (kW)(MWh)Cost Costs Resource Summer Winter Summer Winter Total (1993 $000)|(1993 $000) Diese!Generator (DFS)2,150 2,150 4,520 10,547 15,067 $1,765 $176 Diesel Generator (Nome Data)2,150 2,150 4,520 10,547 15,067 $1,639 $139 Diese!Generator 3,650 3,650 7,674 17,905 25,579 $2,520 $236 Sutton-Glennallen Intertie 15,000 15,000 31,536 73,584 105,120 $56,200 $337 Allison Lake 0 6,255 (9)27,396 27,396 $32,240 $284 Silver Lake -Option A 0 15,000 1,176 43,576 44,752 $54,185 $593 -Option B i!)14,000 2,376 46,376 48,752 $60,703 $593 Coal Facility 0 11,000 0 46,376 46,376 $23,500 $1,730 Solomon Gulch Expansion Notes: 1|Summer period is part of June through September (2628 hours) 2{Winter period is slighitly more than October through May (6132 hours) .3{Diesel energy generation is based on 80%capacity factor for illustrative purposes ' 4|Allison Lake capacity includes 3045 kW from Allison Lake and 3110 kW additional capacity at Solomon Gulch 5 |Hydro MWh based on assumed average water conditions 6 {Coal Facility MWh assumes 95%availability during winter period 7/O&M excludes fuel costs r 8 Costs shown here to not include estimated additional costs for power plant building,fuel storage tank and switchyard improvements which may be needed for increasing base load diese!generation in Valdez. These costs are added directlyto the economic analysis model. 9|Base Case Scenarios run with DFS figures for Diesel Units 10/Sensitivity Analysis run with Nome figures for Diesel Units 11:05 PM 2/21/94 Schedule P-1 Intertie }| Projected Cost of Power from CEA (1993$per MWH) Transmission Loss=9.70% oy =1.732] Capital CostYearFuelPriceComponent Margins Subtotal Net Delivered 1998 $25.58 $0.00 $0.00 $25.58 $28.33 1999 $26.02 $0.00 $0.00 $26.02 $28.82 2000 $26.47 $0.00 $0.00 $26.47 $29.32 2001 $26.93 $0.00 $0.00 $26.93 $29.82 2002 $27.40 $0.00 $0.00 $27.40 $30.34 2003 $27.87 $0.00 $0.00 $27.87 $30.86 2004 $28.35 $0.00 $0.00 $28.35 $31.40 2005 $28.84 $3.00 $0.00 $31.84 $35.26 2006 $29.34 $3.00 $0.00 $32.34 $35.82 2007 $29.85 $3.00 $0.00 $32.85 $36.38 2008 $30.37 $3.00 $0.00 $33.37 $36.95 2009 $30.89 $3.00 $0.00 $33.89 $37.53 2010 $31.43 $3.00 $0.00 $34.43 $38.12 2011 $31.97 $3.00 $0.00 $34.97 $38.73 2012 $32.52 $3.00 $0.00 $35.52 $39.34 2013 $33.09 $3.00 $0.00 $36.09 $39.96 2014 $33.66 $3.00 $0.00 $36.66 $40.60 2015 $34.24 $3.00 $0.00 $37.24 $41.24 2016 $34.83 $3.00 $0.00 $37.83 $41.90 2017 $35.43 $3.00 $0.00 $38.43 $42.56 2018 $36.05 $3.00 $0.00 $39.05 $43.24 2019 $36.67 $3.00 $0.00 $39.67 $43.93 2020 $37.31 $3.00 $0.00 $40.31 $44.64 2021 $37.95 $3.00 $0.00 $40.95 $45.35 2022 $38.61 $3.00 $0.00 $41.61 $46.08 2023 $39.28 $3.00 $0.00 $42.28 $46.82 2024 $39.96 $3.00 $0.00 $42.96 $47.57 2025 $40.65 $3.00 $0.00 $43.65 $48.34 2026 $41.35 $3.00 $0.00 $44.35 $49.11 2027 $42.07 $3.00 $0.00 $45.07 $49.91 2028 $42.79 $3.00 $0.00 $45.79 $50.71 2029]-$43.53 $3.00 $0.00 $46.53 $51.53 2030 $44.29 $3.00 $0.00 $47.29 $52.37 2031 $45.05 $3.00 $0.00 $48.05 $53.21 2032 $45.83 $3.00 $0.00 $48.83 $54.08 2033 $46.62 $3.00 $0.00 $49.62 $54.96 2034 $47.43 $3.00 $0.00 $50.43 $55.85 2035 $48.25 $3.00 $0.00 $51.25 $56.76 2036 $49.09 $3.00 $0.00 $52.09 $57.68 2037 $49.94 $3.00 $0.00 $52.94 $58.62 2038 $50.80 $3.00 $0.00 $53.80 $59.58 2039 $51.68 $3.00 $0.00 $54.68 $60.55 2040 $52.57 $3.00 $0.00 $55.57 $61.54 2041 $53.48 $3.00 $0.00 $56.48 $62.55 2042 $54.41 $3.00 $0.00 $57.41 $63.57 2043 $55.35 $3.00 $0.00 $58.35 $64.62 2044 $56.31 $3.00 $0.00 $59.31 $65.68 2045 $57.28 $3.00 $0.00 $60.28 $66.76 2046 $58.27 $3.00 $0.00 $61.27 $67.85 2047 $59.28 $3.00 $0.00 $62.28 $68.97 11:03 AM 2/18/94 Schedule P-2 Intertie || Projected Cost of Power from CEA (1993$per MWH) Real Escalation=0.03% Transmission Loss=9.70% Capital Cost Year Fuel Price Component Margins Subtotal Net Delivered 1998 $25.58 $0.00 $0.00 $25.58 $28.33 1999 $25.59 $0.00 $0.00 $25.59 $28.34 2000 $25.60 $0.00 $0.00 $25.60 $28.34 2001 $25.60 $0.00 $0.00 $25.60 $28.35 2002 $25.61 $0.00 $0.00 $25.61 $28.36 2003 $25.62 $0.00 $0.00 $25.62 $28.37 2004 $25.63 $0.00 $0.00 $25.63 $28.38 2005 $25.63 $3.00 $0.00 $28.63 $31.71 2006 $25.64 $3.00 $0.00 $28.64 $31.72 2007 $25.65 $3.00 $0.00 $28.65 $31.73 2008 $25.66 $3.00 $0.00 $28.66 $31.74 2009 $25.66 $3.00 $0.00 $28.66 $31.74 2010 $25.67 $3.00 $0.00 $28.67 $31.75 2011 $25.68 $3.00 $0.00 $28.68 $31.76 2012 $25.69 $3.00 $0.00 $28.69 $31.77 2013 $25.70 $3.00 $0.00 $28.70 $31.78 2014 $25.70 $3.00 $0.00 $28.70 $31.79 2015 $25.71 $3.00 $0.00 $28.71 $31.79 2016 $25.72 $3.00 $0.00 $28.72 $31.80 2017 $25.73 |$3.00 $0.00 $28.73 $31.81 2018 $25.73 $3.00 $0.00 $28.73 $31.82 2019 $25.74 $3.00 $0.00 $28.74 $31.83 2020 $25.75 $3.00 $0.00 $28.75 $31.84 2021 $25.76 $3.00 $0.00 $28.76 $31.85 2022 $25.76 $3.00 $0.00 $28.76 $31.85 2023 $25.77 $3.00 $0.00 $28.77 $31.86 2024 $25.78 $3.00 $0.00 $28.78 $31.87 2025 $25.79 $3.00 $0.00 $28.79 $31.88 2026 $25.80 $3.00 $0.00 $28.80 $31.89 2027 $25.80 $3.00 $0.00 $28.80 $31.90 2028 $25.81 $3.00 $0.00 $28.81 $31.91 2029 $25.82 $3.00 $0.00 $28.82 $31.91 2030 $25.83 $3.00 $0.00 $28.83 $31.92 2031 $25.83 $3.00 $0.00 $28.83 $31.93 2032 $25.84 $3.00 $0.00 $28.84 $31.94 2033 $25.85 $3.00 $0.00 $28.85 $31.95 2034 $25.86 $3.00 $0.00 $28.86 $31.96 2035 $25.87 $3.00 $0.00 $28.87 $31.97 2036 $25.87 $3.00 $0.00 $28.87 $31.97 2037 $25.88 $3.00 $0.00 $28.88 $31.98 2038 $25.89 $3.00 $0.00 $28.89 $31.99 2039 $25.90 $3.00 $0.00 $28.90 $32.00 2040 *$25.90 $3.00 $0.00 $28.90 $32.01 2041 $25.91 $3.00 $0.00 $28.91 $32.02 2042 $25.92 $3.00 $0.00 $28.92 $32.03 2043 $25.93 $3.00 $0.00 $28.93 $32.04 2044 $25.94 $3.00 $0.00 $28.94 $32.04 2045 $25.94 $3.00 $0.00 $28.94 $32.05 2046 $25.95 $3.00 $0.00 $28.95 $32.06 2047 $25.96 $3.00 $0.00 $28.96 $32.07 11:14 AM 2/18/94 Diesel OCRA -Division of Energy:Copper Valley Intertie Feasibility Study { Low Load;Medium Fuel Economic Analysis (Constant 1903 Dollars -All Costs in Thousands of Dollars) 1993 1994 1995 1996 41997 1998 1999 2000 2201 20202 2903 2204 Diesel Costs Fuel $1,131 $1,210 $1,413 $1,374 $1,006 $1,154 $1,151 $1,149 $1,148 $1,144 $1,139 $1,135 Variable O&M $745 $707 $916 $888 $206 $218 $217 $217 $217 $216 $2156 $214 Existing Diesel O&M Adjustment Additional Building &Equipment New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Cosis $283 $283 $425 $425 $425 $425 $425 $425 Total Diese!Costs $1,876 $2,007 $2,329 $2,261 $1,611 $1,680 $1,819 $1,817 $1,815 $1,810 $1,605 $1,800 Total Conservation Cost intertle Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,876 $2,007 $2,329 $2,261 $1,611 $1,680 $1,819 $1,817 $1,815 $1,810 $1,805 $1,800 Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues trom Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,876 $2,007 $2,329 $2,261 $1,611 $1,680 $1,819 $1,617 $1,815 $1,810 $1,805 $1,800 Present Value In 1993 Dollare Cummulative (1993-2017)$25,334 [(In th ds) 30 year (2018-2047)with "no additional growth $5,995 i{in th ds) Total Net Present Value |[$31,329 {(In thousands) 4:55 PM Page t 2/10/04 Diese! Low Load;Medium Fuet 2005 2006 2007)2008 2909 2019 20tt 2012 20131 2014 2015 2016 Diese!Costs Fuel $1,131 $1,127 $1,122 $4,118 $1,115 $1,109 $1,023 $980 $746 $743 $740 $736 $732 Variable OAM $213 $212 $212 $211 $210 $209 .$193 $185 $140 $140 $139 $138 $137 Existing Diesel O&M Adjust t Additional Building &Equipment New Diese!Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Costs $425 $425 $425 $425 $425 $425 $425 $425 $426 $425 $425 $425 $425 Total Diesel Costs $1,705 $1,790 $1,765 $1,780 $1,775 $1,768 $1,667 $1,616 $1,337 $1,333 $1,329 $1,325 $1,321 Total Conservation Coat tntertte Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total intertie Coste Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost _of Power $1,705 $1,790 $1,785 $1,780 $1,775 $1,768 $1,667 $1,616 $1,337 $1,333 $1,329 $1,925 $1,321 Sale of Surplus Solomon Quich Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,795 $1,790 $1,785 $1,760 $1,775 $1,768 $1,667 $1,616 $1,397 $1,393 $1,329 $1,925 $1,321 4:54 PM : Page 2 2/19/04 Diesal DCRA -Division of Energy:Copper Valley Intertie Feasibility Study | Low Load;High Fuel Economic Analysis (Constant 1993 Dollars -All Costs in Thousands of Dollars) 1993 1994 1996 1996 1997 1998 1999 2909 2001 2202 2203 20204 Diese!Costs Fuel $1,131 $1,231 $1,462 $1,445 $1,172 $1,255 $1,273 $1,299 $1,314 $1,331 $1,340 $1,367 Variable O&M $745 $797 $916 $888 $206 $218 $217 $217 $217 $216 $216 $214 Existing Diesel O&M Adjustment Additional Buiiding &Equipment New Diesel Faxed O&M $26 $26 $26 $26 $26 $26 $26 $26 New Diesel!Capital Cosis $283 $283 $425 $425 $425 $425 $425 $425 Total Diesel Costs $1,676 $2,026 $2,377 $2,333 $1,687 $1,762 $1,941 $1,961 $1,981 $1,907 $2,014 $2,031 Totat Conservation Cost intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total intertle Cosis Other Annual!Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,876 $2,028 $2,377 $2,333 $1,687 $1,782 $1,041 $1,061 $1,081 $1,907 $2,014 $2,031 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues from Sale Cistrict Heat Net Revenue (Coal Case) Net Annual Cost of Power $4,876 $2,028 $2,377 $2,333 $1,687 $1,782 $1,041 $1,961 $1,001 $1,907 $2,014 $2,031 Present Value In 1993 Dollars Cummulative (1993-2017)$27,936 j{in_thousands) 30 year (2018-2047)with "no additional growth*$7,652 |(in thousands) Total Net Present Value |$35,588 I{in_thousande) 4:51 PM Page 1 2/19/04 Diesel Low Load:High Fuel 2008)2012: Diesel Coste 2016 Fuel $1,402 $1,350 $1,072 $1,004 $1,098 Variable O&M $212 $165 $139 $198 $137 Existing Diesel O&M Adjustment Additional Building &Equipment New Diesel Fixed O&M $26 $26 $26 $26 $26 New Diesel Capital Costs $425 $425 $425 $425 $425 Total Dieset Costs $2,065 $1,986 $1,661 $1,673 $1,686 Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertle Coste Other Annual Carrying Charge Annual O&M Coste Total Other Costs Totat Cost of Power $2,048 $2,065 $2,089 $2,101 $2,120 $2,196 $2,030 $1,986 $1,637 $1,649 $1,661 $1,673 $1,686 Sate_of Surplus Solomon Guich Energy Surplue Energy Revenues from Sale District Heat Net Revenue (Coal Caee $2,048 $2,065 $2,083 $2,101 $2,120 $2,136 $2,030 $1,986 $1,637 $1,649 $1,661 $1,673 $1,686Net_Annual Cost of Power 4:51PM Page 2 2/19/94 DFS Diese!Case OCRA -Dwvision of Energy:Copper Valley interlie Feasibility Study I Medium Demand;Medium Fuel Economic Analysis (Constant 1993 Dotiars -All Costs in Thousands of Dollars) 1993 1994 1995 1996 1997 1998 1999 2909 2001 2202 2903 2004 Diese!Costs Fuel $1,144 $1,271 $1,612 $1,682 $1,602 $1,565 $1,574 $1,602 $1,635 $1,662 $1,669 $1,716 Variable O&M $754 $835 $085 $700 $633 $400 $320 $330 $349 $338 $343 $349 Existing Diesel O&M Adjustment $291 $201 $291 $201 $201 $201 Additional Building &Equipment $133 $133 $133 $133 $133 $166 New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Costs $142 $263 $426 $567 $567 $567 $708 $708 $708 Total Diese!Costs $1,696 $2,106 $2,406 $2,540 $2,544 $2,425 $2,910 $2,949 $3,001 $3,158 $3,190 $3,255 Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Totat Intertie Costs * Other Annual Carrying Charge Annual O&M Costs Total Other Cosis Total Cost_of Power $1,698 $2,106 $2,496 $2,549 $2,544 $2,425 $2,910 $2,040 $3,001 $3,158 $3,190 $3,255 Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale Oistrict Heal Net Revenue (Coal Case) Net Annual Cost of Power $1,608 $2,106 $2,496 $2,549 $2,544 $2,425 $2,010 $2,040 $3,001 $3,168 $3,100 $3,255 Present Value In 1993 Dollars Cummulative (1993-2017)$41,459 |(In th ds) 30 year (2016-2047)with "no additional growth”$16,683 |(In thousande) Total _Net_Present Value $50,142 |(in thousands) 6:18 PM Page 1 2/18/04 2005)2008 2012 Olese!Costs Fuel $1,741 $1,766 $1,926 Variable O&M $354 $359 $301 Existing Diesel OAM Adjustment $201 $201 $201 Additional Building &E $166 $166 $166 New Diesel Fixed O&M $26 $26 $26 New Diese!Capital Costs $708 $708 $708 $708 Total Diese!Costs $3,205 $3,316 $3,507 $3,574 Total Conservation Cost (intertie Cost Annual Carrying Charge Annual OAM Costs Economy Energy Totat intertie Costs Other Annual Carrying Charge Annual O&M Coste Total Other Costes Total Cost_of Power $3,286 $3,316 $3,347 $3,378 $3,410 $3,442 $3,474 $3,507 $3,541 $3,674 $3,608 $3,641 $3,675 Sale_of Surplus Solomon Guich Ene Surplus Ene Revenues from Saie District Heat Net Revenue (Coal Case Net Annuat Cost of Power $3,285 $3,316 $3,347 $3,378 $3,410 $3,442 $3,474 $3,507 $3,541 $3,674 $3,608 $3,641 $3,675 6:20 PM Page 2 2/18/04 OFS Diese!Casa OCRA -Dwvision of Energy:Copper Valiey intertie Feasibility Study If Medium Demand;High Fuel Economic Analysis (Constant 1903 Dollars -All Cosis in Thousands of Dollars) 1993 1994 1905 1906 1997 jge8 1999 2200 2001 2202 20203 2004 Diese!Costs Fuel $1,144 $1,202 $1,664 $1,665 $1,713 $1,702 $1,741 $1,803 $1,871 $1,034 $1,999 $2,065 Variable O&M $764 $835 $985 $709 $633 $4090 $320 $330 $3490 $3386 $343 $349 Existing Diesel OAM Adjustment :$2901 $201 $201 $201 $201 $201 Additional Building &Equipment $133 $133 $133 $133 $133 $166 New DieselFixedO&M $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Cosis $142 $283 $425 $567 $667 $567 $708 $708 $708 Total Diesel Costs $1,898 $2,128 $2,548 $2,631 $2,656 $2,562 $3,077 $3,149 $3,237 $3,430 $3,500 $3,604 Total Conservation Cost intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total intertie Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,808 $2,128 $2,548 $2,631 $2,656 $2,562 $3,077 $3,149 $3,237 $3,430 $3,500 $3,604 Sale of Surplus Solomon Guich Energy - Surplus Energy Revenues trom Sale District Heat Net Revenue (Coa!Case) Net Annual Coet_of Power $1,608 $2,128 $2,548 $2,631 $2,656 $2,562 $3,077 $3,149 $3,237 $3,430 $3,500 $3,604 Present Value in 1003 Dollare Cummulative (1993-2017)$46,136 {(In thousands) 30 year (2019-2047)with °no additional growth"$21,357 |(in thousands) Total Net Present Value |l $67,496 [(In thousands) Paget 2/18/046:14 PM DES Diese!Case Medium 0.d;High Fuel 2007 2008 2209 20it Olesel Coste Fuel $2,269 $2,341 $2,416 $2,671 $3,096 Variable OAM $364 $369 $374 $385 $418 Existing Diesel O&M Adjustment $291 $291 $291 $291 $291 $166 $166 $166 $166AdditionalBuilding&Equipment New Diesel Fixed O&M $26 $26 $26 $26 $26 New Diesel Capital Costs $708 $708 $708 $708 $708 Total Diese!Costs $3,824 $3,901 $3,981 $4,147 $4,705 Tote!Conservation Cost "{intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Coste Other Annual Carrying Charge Annual O&M Coste Total Other Costs Total Cost_of Power $3,675 $3,749 $3,824 $3,901 $3,961 $4,063 $4,147 $4,234 $4,924 $4,416 $4,510 $4,605 $4,705 Sale_of Surplus Solomon Guich Ene Surplus Energy Revenues trom Sale District Heat Net Revenue (Coa!Case Net Annual Cost of Power $3,676 $3,749 $3,624 $3,901 $3,981 $4,063 $4,147 $4,234 $4,324 $4,416 $4,510 $4,605 $4,705 6:14 PM Page2 2/18/94 OFS Diese!Case DOCRA-Division of Energy:Copper Valiey Intertie Feasibility Study | High Demand:Medium Fuel Economie Analysis (Constant 1903 Dollars -All Costs in Thousands of Dollars) 1993 1924 1995 1996 1997 1998 1999 2200 2001 2202 2903 2904 Diese!Costs Fuel $1,144 $1,271 $1,612 $1,562 $1,602 $1,650 $1,790 $1,048 $2,106 $2,256 $2,431 $2,547 Varlable O&M $764 $835 $985 $799 $633 $457 $365 $307 $430 $461 $5468 $520 Existing Diese!O&M Adjustment $201 $291 $201 $201 $2901 $201 Additional Bullding &Equipment $133 $133 $133 $133 $133 $t66NewDiese!Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $52 New Diesel Captial Costs $142 $283 $425 $708 $708 $708 $708 $708 $850 Total Diese)Costs $1,806 $2,106 $2,406 $2,549 $2,544 $2,566 $3,313 $3,503 $3,604 $3,876 $4,137 $4,425 Totat Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,008 $2,106 $2,496 $2,649 $2,544 $2,566 $3,313 $3,503 $3,604 $3,876 $4,137 $4,425 Sale of Surpius Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,808 $2,106 $2,406 $2,640 $2,544 $2,566 $3,313 $3,603 $3,604 $3,876 $4,137 $4,425 Presert Value in 1993 Dollars Cummulative (1993-2017)$50,552 |(In thousands) 30 year (2018-2047)with "no additional growth*$22,223 |(In th de) Total Net Present Value_|$72,774 |(in_thousands) 6:28 PM Page t 2/18/04 OFS Diese!Case IHigh Demand;Medium Fuel 2005 2007 2008 2ooa 2010)2013 2015 2018) Olesel Coste Fuel $2,673 $2,627 $2,654 $2,681 $2,709 $2,704 $2,952 $2,88t $2,012 Variable OAM $526 $542 $549 $557 $565 $5a9 $605 $613 $625 Existing Diesel O&M Adjusiment $2ot $201 $291 $201 $291 $291 $291 $291 $201 'Additional Buliding &Equipment $166 $166 $166 $166 $166 $166 $166 New Diesel Fixed O&M $52 $52 $52 $52 $52 $52 $52 $52 $52 New Diese!Capital Costs $850 $850 $650 $850 $3850 $850 $850 $850 $850 Total Diesel Costs $4,456 $4,527 $4,561 $4,596 $4,632 $4,741 $4,815 $4,852 $4,895 Totat_Conservation Cost Intertle Cost Annuat Carrying Charge Annual O&M Coste Economy Energy Tota Intertie Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost_of Power $4,456 $4,493 $4,561 $4,596 $4,632 $4,668 $4,705 $4,741 $4,778 $4,615 $4,652 $4,805 Sale of Surplue Solomon Guich Enemy Surplus Energy Revenues trom Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $4,493 $4,527 $4,561 $4,596 $4,632 $4,668 $4,705 $4,741 $4,778 $4,615 $4,852 $4,605$4,456 6:27 PM Page 2 2/18/94 OFS Dice!Case OCRA -Division of Energy:Copper Vailay intertie Feasibility Study High Demand;High Fuet Economic Analysis (Constant 993 Dollars -All Costs in Thousands of Dollars) 1993 1998 1992 1928 2200 220)2292 2004 $1,144 $1,665 $1,713 $1,605 $2,101 $2,409 $2,626 $3,065 $754 $799 $633 $457 $307 $430 $461 $520 Existing Diesel O&M Adjusiment $201 $291 $201 $201 Additional Building &Equipment $133 $133 $133 $166 New Diese!Faxed O&M $26 $26 $26 $26 $26 $26 $52 New Diesel Capital Costs $142 $283 $425 $708 $708 $708 $860 Total Diesel Costs $1,606 $2,128 $2,648 $2,631 $2,656 $2,712 $3,747 $3,007 $4,245 $4,044 Total Conservalion Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Cosis Other Annual Carrying Charge Annual O&M Costs Total Other Costs Tota!Cost of Power $1,800 $2,548 $2,631 $2,712 $3,504 $3,747 $3,007 $4,246 $4,583 $4,044$2,656 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues from SaleDistrictHeatNetRevenue (Coal Case) Net Annual Cost of Power $1,806 $2,128 $2,646 $2,631 $2,656 $2,712 "$3,504 $3,747 $3,007 $4,245 $4,563 $4,044 Present Value In 1003 Dollare Cummulative (1993-2017)$57,059 (in th a $20,612 (In_thousands)$0 year (2018-2047)with "no additional growth”JTotalNetPresentValue|$65,671 (In thousands) 6:21 PM Page 1 2/18/04 OFS Diese!Case High Demand,High Fuel 2005 2007 2008 2009 2010 2011 2013 A014 2016 2016 Diese?Costs Fuel $3,149 $3,326 $3,417 $3,511 $3,608 $3,707 $3,914 $4,022 $4,132 $4,244 Variable O&M $525 $542 $549 $557 $565 $573 $589 $597 $605 $613 $291 $291 $291 $291 $291 $291ExistingDiese!O&M Adjustment $291 $201 $291 $201 $166 $166 $166 $166 $166 $166 $166 $166 $166AdditionalBuilding&EquipmentNewDieselFixedO&M $52 $52 $52 $52 $52 $52 $52 $52 $52 $52 New Diese!Capital Costs $850 $850 $850 $850 $850 $850 $850 $850 $850 $650 Total Diese!Coste $5,033 $5,226 $5,324 $5,426 $5,531 $5,638 $5,861 $5,977 $6,096 $6,216 Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Cosis Economy Energy Total intertie Costs Other Annual Carrying Charge Annual OAM Costs Total Other Costs Total Cost_of Power $6,033 $5,129 $5,226 $5,324 $5,426 $5,531 $5,638 $5,749 $5,661 $5,077 $6,005 $6,216 $6,347 Sale of Surplus Sok Gulch Enemy Surplue Energy . Revenues trom Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $5,033 $5,129 $5,226 $5,324 $5,426 $5,531 $5,638 $5,749 $5,661 $6,005 $6,216 $6,347 6:23 PM Page 2 2/18/04 tntertle OCRA -Division of Energy:Copper Valley Intertie Feasibility Sludy | Low Load;Medium Fuel Economic Analysis(Constant 1903 Dotiars -All Costs in Thousands of Doilars) Low Intertia Construction 1903 3904 {905 1996 1907 j9938 1992 2200 2001 2002 2003 2004 Diesel Costs Fuel $1,131 $1,210 $1,413 $1,374 $1,261 $0 Variable OAM $745 $707 $916 $868 $826 $o Existing Diesel O&M Adjustment ($560)($560)($560)($560)($560)($560)($560) Additional Building &Equipment : New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs $1,876 $2,007 $2,320 $2,261 $2,086 ($560)($560)($560)($660)($660)($660)($560) Total Conservation Cost Intertle Cost Annual Carrying Charge $2,516 $2,516 $2,616 $2,616 $2,516 $2,616 $2,516 Annual O&M Costs $207 $207 $207 $207 $262 $207 $207 Economy Energy $920 $976 $1,005 $1,034 $1,060 $1,083 $1,107 Total intertia Costs $3,652 $3,609 $3,728 $3,756 $3,657 $3,806 $3,830 Other Annual Carrying Charge Annual!O&M Costs Total Other Costs Total Cost of Power $1,876 $2,007 $2,320 $2,261 $2,086 $3,002 $3,130 $3,168 $3,106 $3,207 $3,246 $3,270 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,676 $2,007 $2,329 $2,261 $2,086 $3,002 $3,130 $3,166 $3,106 $3,207 $3,246 $3,270 Present Value in 1993 Dollars Cummulative (1993-2017)$40,767 |(in th ds) 30 year (2018-2047)with "no additional growth”$14,188 [(in th ds) Total Net Present Value I $54,954 (in thousands) 41:28 PM 2/21/04Page1 intertie Low Load:Medium Fuet Low Intertle Construction 2013}Diese!Costs Fuel Varlable OAM ($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)Exleting Diese!O&M Adjustment Additional Building &Equipment New Diesel Fixed O&M New Diesel Capital Costs ($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)Total Diesel Costs Total Conservation Cost Iintertie Cost $2,616$2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,616 $2,616AnnuelCarryingCharge $207 $207 $282 $221 $221 $221 $221 $346 $240 $240 $240 $240 $365AnnualO&M Costs $1,237 $1,236 $1,232 $1,228 $1,223 $1,217 $1,123 $1,075 $820 $até $a12 $808 $804EconomyEnergy Total Intertie Costs $3,960 $3,959 $4,020 $3,965 $3,960 $3,954 $3,860 $3,937 $3,576 $3,572 $3,568 $3,564 $3,685 Other Annual Carrying Charge Annual O&M Costs Total Other Costs $3,309 $3,469 $3,405 $3,400 $3,304 $3,300 $3,377 $3,016 $3,012 $3,008 $3,004 $3,126TotalCostofPower$3,400 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues trom Sate District Heat Net Revenue (Coal Cave) $3,399 $3,469 $3,405 $3,400 $3,394 $3,300 $3,377 $3,016 $3,012 $3,008 $3,004 $3,125NetAnnualCostofPower$3,400 11:27 PM Page 2 2/21/04 intertie OCRA -Division of Energy:Copper Valley intertie Feasibility Study | Low Load;High Fuel Economic Analysis (Constant 1903 Dollars -All Costs in Thousands of Doliars) Low Intertle Construction ; 1993 1994 1996 1996 1997 1998 1999 2200 2902 2002 2203 2904 Diesel Coste Fuel $1,431 $1,231 $1,462 $1,445 $1,349 $0 Variable O&M $745 $797 $9016 $asa $826 $0 Existing Diesel O&M Adjustment ($560)($560)($560)($560)($560)($560)($560) Additional Building &Equipment New Diesal Faxed O&M New Diesel Capital Costs Total Diese!Costs $1,876 $2,028 $2,377 $2,333 $2,174 ($560)($560)($560)($560)($560)($560)($560) Total Conservation Cost Intertie Cost Annual Carrying Charge $2,516 $2,516 $2,616 $2,516 $2,516 $2,616 $2,516 Annual O&M Costs $207 $207 $207 $207 $262 $207 $207 Economy Energy $920 $9903 $1,039 $1,067 $1,133 $1,179 $1,225 Total intertie Coats $3,652 $3,716 $3,762 $3,810 $3,931 $3,901 $3,948 Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,876 $2,028 $2,377 $2,333 $2,174 $3,002 $3,156 $3,202 $3,250 $3,371 $3,341 $3,368 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annua!Cost of Power $1,876 $2,028 $2,377 $2,333 $2,174 $3,002 $3,156 $3,202 $3,250 $3,371 $3,341 $3,388 Present Value In 1993 Dollare Cummulative (1993-2017)$42,309 [(In_th de) 30 year (2018-2047)with "no additional growth®$15,422 {(in_tho de) Total Net Present Value |i $57,730 {(in_thousands) 11:36 PM Page 1 2/21/04 Low Load;High Fuel Low tntertle C 2008 2013 2014 Fuel Olesel Coats Variable O&M {Existing Diese!O&M Adjustment ($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560) Additional Building &Equipment New Diesel Fixed O&M New Diesel Capitat Coste ($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)Total Diese!Costs Total Conservation Cost Intertle Cost $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,616 $2,616 $2,616 $2,516 $2,516AnnualCarryingCharge Annual OAM Costs $207 $207 $282 $221 $221 $221 $221 $346 $240 $240 $240 $240 $365 $1,376 $1,396 $1,413 $1,429 $1,446 -$1,461 $1,370 $1,932 $1,031 $1,042 $1,053 $1,064 $1,076EoononyEnergy $4,098 $4,119 $4,210 $4,166 $4,183 $4,198 $4,107 $4,194 $3,787 $3,798 $3,800 $3,921 $3,057TotalIntertieCosts Other Annual Carrying Charge Annual O&M Costs Total Other Costs $3,538 $3,559 $3,650 $3,606 $3,623 $3,638 $3,547 $3,634 $3,227 $3,238 $3,249 $3,261 $3,397TotalCostofPower Sale of Surptus Sol Guich Energy '3 Revenues trom Sale District Heal Net Revenue (Coal Case Energy $3,397$3,538 $3,559 $3,650 $3,606 $3,623 $3,638 $3,547 $3,634 $3,227 $3,238 $3,249 $3,261NetAnnualCostofPower 11:37 PM Page 2 2/21/04 Intertle Case OCRA -Division of Energy:Copper Valley intertie Feasibility Study . Medium Load;Medium Fuel Economie Analysis (Constant 1993 Dollars -All Costs in Thousands of Dollars) Low Construction 1993 1904 1998 1996 1997 1998 31999 2009 2901 2002 2993 20204 Olese!Costs Fuel $1,144 $1,271 $1,606 "$1,688 $2,072 $o $o $o $0 $o $0 $oVariableO&M $754 $635 $985 $1,063 $1,136 $0 $0 $0 $o $0 $o $o Existing Diesel O&M Adjustment ($560)($560)($560)($560)($560)($560)($560) Additional Building &Equipment New Diesel Fxed OAM New Diesel Capital Costs Total Diesel Costs $1,808 $2,106 $2,680 $2,951 $3,208 ($560)($560)($560)($560)($560)($560)($560) Total Conservation Cost Intertie Cost : Annual Carrying Charge $2,516 $2,516 $2,516 $2,516 $2,816 $2,516 $2,516 Annual O&M Cosis $207 $207 $207 $207 $262 $207 $207 Economy Energy $1,061 $1,070 $1,088 $1,100 $1,130 $1,146 $1,166 Total Intertie Costs $3,774 $3,792 $3,811 $3,631 $3,028 $3,871 $3,889 Other Annual Carrying Charge Annual OAM Costs Total Other Costs Total Cost of Power $t,6998 $2,106 $2,580 $2,051 $3,208 $3,214 $3,232 $3,251 $3,271 $3,368 $3,311 $3,320 Sale of Surplus Solomon Gulch Energy Surptus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,698 $2,106 $2,560 $2,051 $3,208 $3,214 $3,232 $3,251 $3,271 $3,368 $3,311 $3,320 Present Value in 1993 Dollars Cummulative (1903-2017)$44,743 |(in th de) 30 year (2018-2047)with "no additional growth"$17,660 [(In th ds) Total _Net_Present Value L $62,404 [(In thousands) 12:34 PM 2/18/04Page1 ° lIntertio Case Medium Load,Medium Fuel Low Construction Diesel Costs $0Fuel Variable O&M $0 ($560)Existing Diese!O&M Adjustment Additional Building &Equip New Diesel Fixed OAM New Diesel Capital Costes ($560)($660)($560)($560)($560)($660)($560)($560)($660)($560)($560)($580)Total Diesel Costs ($560) Total Conservation Cost tntertie Cost Annual Carrying Charge $2,516 $2,616 $2,616 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $240 $2,516 $240 $2,516 $240 $2,516 $365$207 $207 $282 $221 $221 $221 $221 $346 $240 $1,569 Annual O&M Costs $1,403 $1,421 $1,442 $1,463 $1,484 $1,505 $1,526 $1,548$1,342 $1,361 $1,901EyEnergy$1,322 $4,064 $4,159 $4,118 $4,138 $4,158 $4,178 $4,325 $4,240 $4,261 $4,262 $4,304 $4,450TotalintertieCosts$4,045 Other Annuat Carrying Charge Annual O&M Costs Total Ciher Costs $3,500 $3,558 $3,578 $3,508 $3,619 $3,765 $3,680 $3,701 $3,722 $3,744 $3,890TotalCostofPower$3,405 $3,504 Sale of Surplus Solomon Gulch Ene Surplus Energy Revenues from Saie jDistrict Heat Net Revenue (Coal Case $3,722 $3,744 $3,890$3,604 $3,599 $3,578 $3,508 $3,619 $3,765 $3,680 $3,701NetAnnualCostofPower$3,485 $3,558 12:33 PM Page 2 2/18/04 Intertie Case OCRA-Division of Energy:Copper Valley Intertie Feasibility Study I Medium Load;High Fuel Economic Analysis (Constant 1993 Dollars -All Costs in Thousands of Dollars) Low Construction 1993 1994 1995 1996 1997 1998 1999 2200 2201 2202 2903 2904 Diese!Cos!s Fuel $1,144 $1,202 $1,650 $1,985 $2,216 $0 $0 $0 $o $o $0 $o Variable O&M $754 $835 $965 $1,063 $1,136 $0 $0 $0 $0 $0 $0 $o Existing Diesel O&M Adjustment ($560)($560)($560)($560)($560)($560)($560) Additional Building &Equipment New Diesel Faxed O&M New Diesel Capital Costs Total Diesel Costs $1,808 $2,128 $2,635 $3,049 $3,352 ($560)($560)($560)($560)($660)($660)($660) Total Conservation Cost Intertie Cost Annual!Carrying Charge $2,516 $2,518 $2,516 $2,516 $2,516 $2,516 $2,516 Annual O&M Costs $207 $207 $207 $207 $282 $207 $207 Economy Energy $1,051 $1,088 $1,126 $1,166 $1,200 $1,249 $1,290 Total Intertie Costs $3,774 $3,810 $3,848 $3,889 $4,006 $3,072 $4,043 Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,898 $2,128 $2,635 $3,049 $3,352 $3,214 $3,250 $3,288 $3,329 $3,446 $3,412 $3,453 Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,806 $2,128 $2,635 $3,049 $3,352 $3,214 $3,250 $3,268 $3,320 $3,446 $3,412 $3,453 Present Vatue in 1993 Dollars Cummulative (1993-2017)$46,645 (in tho de) 30 year (2018-2047)with "no additional growth"$20,068 |(in th de) Total Net Present Value |$66,912 [iin thousands) 6:07 PM Page t 2/21/04 Hintertie Case [Medium Load;High Fuel Low Construction 2Qi2 2014 2016 Diese!Costs Fuel $o $0 $o $o Variable O&M $0 $o $0 $0 ($560)($560)($560)($560)Existing Diese!O&M Adjustment Additional Building &Equip t New Diesel Fixed OAM New Diesel Capital Costs Total Diesel Coste ($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560) Total Conservation Cost Intertie Cost $2,516 $2,616 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,616AnnualCarryingCharge Annual O&M Costs $207 $207 $282 $221 $221 $221 $221 $346 $240 $240 $240 $240 $365 $1,470 $1,515 $1,561 $1,608 $1,657 $1,707 $1,758 $1,811 $1,866 $1,922 $1,980 $2,039 $2,099EconomyEnergy Total Intertle Costes $4,193 $4,238 $4,358 $4,345 $4,394 $4,444 $4,495 $4,673 $4,622 $4,678 $4,736 $4,705 $4,681 Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost _of Power $3,833 $3,678 $3,798 $3,765 $3,834 $3,884 $3,095 $4,062 $4,118 $4,176 $4,235 $4,421 Sale of Surplus Solomon Gulch Enemy Surplus Enemy Revenues trom Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $3,633 $3,678 $3,798 $3,785 $3,634 $3,004 $3,935 $4,113 $4,062 $4,118 $4,176 $4,235 $4,421 5:08 PM Page 2 2/21/04 Intertie OCRA -Division of Energy:Copper Valley Intertie Feasibility Study | High Load;Medium Fuel Economic Analysis (Constant 1903 Dollars -All Costs in Thousands of Dollars) Low intertie Construction : 1993 1904 1995 1996 1907 1998 1999 2900 2001 2002 2203 2004 Diesel Coste Fuel $1,144 $1,271 $1,613 $1,672 $1,857 $0 Variable O&M $754 $835 $985 $1,063 $1,136 $oExistingDieselO&M Adjustment ($560)($560)($560)($560)($560)($560)($560) Additional Building &Equipment $33 New Diesel Fixed O&M $26 New Diesel Capita!Costs $142 Total Diesel Costs $1,696 $2,106 $2,497 $2,736 $2,003 ($560)($560)($560)($560)($560)($560)($360) Total Conservation Cost Intertie Cost : Annual Carrying Charge $2,516 $2,816 $2,616 $2,616 $2,616 $2,616 $2,516 Annual O&M Costs $207 $207 $207 $207 $282 $207 $207 Economy Energy $1,131 $1,240 $1,340 $1,450 $1,663 $1,665 $1,766 Total Intertie Costs $3,854 $3,063 $4,072 $4,182 $4,361 $4,387 $4,486 Other Annual!Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,608 $2,106 $2,497 $2,736 $2,903 $3,204 $3,403 $3,512 $3,622 $3,801 $3,827 $4,128 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,608 $2,106 $2,407 $2,736 $2,993 $3,204 $3,403 $3,512 $3,622 $3,801 $3,827 $4,128 Present Value in 1993 Dollars Cummulative (1993-2017)$50,496 |(In thousands) 30 year (2016-2047)with "no additional growth®$21,654 j(In thousands) Total Net Present Value |{$72,181 |(In_thousands) 2:35 PM Page 1 2/20/04 Intertie High Load;Medium Fuel Low Intertie Construction Diesel Costs Fuel Variable O&M ($560)($560)($560)($560)($560)($560)($560)($560)($660)Existing Diesel O&M Adjustment ($560)($560)($560)($560) $33 $33 $33 $33 $33 $33 $33 $33 $33AdditionalBuilding&Equipment $33 $33 $33 $33 $26$26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26NewDieselFixedOAM $142 $142 $142 $142 $142 $142 $142 $142 $142 $142 $142 $142 $142NewDieselCapitalCosts ($360)($360)($360)($360)($360)($360)($360)($360)($360)($360)($360)($360)Total Diese!Costs ($360) Total Conservation Cost Intertie Cost $2,516 $2,616$2,516 $2,516 $2,616 $2,516 $2,516 $2,516 $2,516 $2,516 $2,516 $2,616 $2,516AnnualCarryingCharge $207 $207 $282 $221 $221 $221 $221 $346 $240 $240 $240 $240 $365AnnualO&M Costs $1,992 $2,013 $2,033 $2,054 $2,075 $2,096 $2,117 $2,139 $2,161 $2,183 $2,205 $2,227 $2,249EoonomyEnergy Total intertie Costs $4,715 $4,735 $4,631 $4,791 $4,012 $4,839 $4,854 $5,001 $4,917 $4,999 $4,061 $4,083 $5,130 Other Annual Carrying Charge Annual O&M Costs Total Ciher Coste $4,365 $4,376 $4,471 $4,431 $4,452 $4,473 $4,404 $4,641 $4,667 $4,579 $4,601 $4,623 $4,770TotalCost_of Power Sate of Surplus Solomon Guich Ene Surplus Enemy Revenues from Sale District Heat Net Revenue (Coal Case $4,375 $4,471 $4,431 $4,452 $4,473 $4,494 $4,641 $4,557 $4,579 $4,601 $4,623 $4,770Net_Annual Cost of Power $4,365 2:35 PM Page 2 2/20/94 Intertie OCAA -Dwision of Energy:Copper Valley intertio Feasibility Study | High Load;High Fuel Economic Analysis (Constant 1993 Doliars -All Costs in Thousands of Dollars) Low Intertie Construction 1993 3994 1995 {996 1997 1998 4999 2200 200)2002 2903 2004 Diese!Costs Fuel $1,144 $1,202 $1,564 $1,759 $1,086 $o Variable O&M $754 $835 $985 $1,063 $1,136 $0 Existing Diesel O&M Adjustment ($560)($560)($560)($560)($560)($560)($560) Additional Building &Equipment $33 New Diesel Fixed O&M $26 New Diesel Capital Costs $142 Total Diesel Costs $1,698 $2,128 $2,549 $2,822 $3,122 ($560)($560)($560)($560)($560)($560)($360) Total Consarvation Cost Intertie Cost Annual Catrying Charge $2,616 $2,516 $2,616 $2,516 $2,516 $2,616 $2,516 Annual O&M Costs $207 $207 $207 $207 $282 $207 $207 Economy Energy $1,131 $1,261 $1,306 $1,635 $1,672 $1,611 $1,054 Total intertie Costs $3,654 $3,084 $4,118 $4,257 $4,470 $4,534 $4,676 Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power $1,898 $2,128 $2,549 $2,622 $3,122 $3,294 $3,424 $3,558 $3,607 $3,010 $3,974 $4,316 Sale of Surplus Solomon Gulch Energy Surpiue Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,608 $2,128 $2,549 $2,622 $3,122 $3,204 $3,424 $3,558 $3,607 $3,010 $3,074 $4,316 Present Value In 1993 Doliare Cummulative (1999-2017)$53,412 |(in_thousands) 30 year (2018-2047)with "no additional growth"$25,105 [(in thousands) Totat_Net_Present Value l $78,517 {in thousands) 2:31 PM Page 1 2/20/04 2:32 PM tntertio High Load;High Fuel Low Intertie Construction 2005 2008 2007 20028!2909 2010 2011 2012 2013 2014)2Q15 2016 2017 Dieset Costs Fuel Variable OAM Existing Diesel O&M Adjustment ($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560)($560) |Additional Building &Equipment $33 $33 $33 $393 $33 $33 $33 $33 $33 $33 $33 $33 $33 New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diese!Capital Cosis $142 $142 $t42 $142 $142 $142 $142 $142 $142 $142 $142 $142 $142 Totat Diese!Costs ($360)($360)($360)($360)($360)($360)($360)($360)($360)($360)($360)($960)($360) Total Conservation Cost Intertle Cost Annual Carrying Charge $2,516 $2,516 $2,616 $2,516 $2,516 $2,516 $2,616 $2,516 $2,516 $2,516 $2,516 $2,616 $2,516 Annual O&M Costs $207 $207 $282 $221 $221 $221 $221 $346 $240 $240 $240 $240 $365 Economy Energy $2,216 $2,273 $2,331 $2,301 $2,453 $2,516 $2,581 $2,649 $2,717 $2,768 $2,860 $2,933 $3,009 Total Intertie Costs $4,938 $4,095 $5,129 $5,128 $5,190 $5,253 $5,318 $5,510 $6,474 $5,644 $5,616 $5,690 $5,890 Other Annual Carrying Charge Annuat O&M Costs Total Ciher Costs Total Cost_of Power $4,578 $4,635 $4,769 $4,768 $4,830 $4,893 $4,058 $5,150 $5,114 $5,164 $5,266 $6,390 $5,630 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $4,578 $4,635 $4,769 $4,768 $4,830 $4,693 $4,058 $5,150 $6,114 $6,184 $5,256 $5,330 $5,630 Page 2 2/20/04 Allison Lake DCRA -Division of Energy:Copper Valley Intertic é --Study if Medium Load;Medium Fuel Economic Analysis (Constant 1993 Dollars -All Cost,:mds of Dotlars) Medium Construction 1293 1994 1995 1996 1997 1998 1999 29299 2001 2002 2003 2004 Olesel Costs Fuel $1,144 $1,271 $1,613 $1,502 $1,597 $1,545 $1,555 $403 $522 $552 $578 $604 Variable OAM $754 $835 $985 $799 $633 $409 $320 $92 $97 $103 $108 $112 Existing Diesel O&M Adjustment ($146)($146)($146)($146)($146) Additional Building &Equipment New Diesel Fed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Costs $142 $283 $425 $567 $567 $567 $567 $567 $567 Total Diesel Costs $1,898 $2,106 $2,407 $2,559 $2,540 $2,405 $2,467 $1,031 $1,066 $1,102 $1,133 $1,163 Total Conservation Cost Intertia Cost Annual Carrying Charge Annual O&M Cosis Economy Energy Total _tntertie Costs Allison Lake Annual Carrying Charge $1,766 $1,766 $1,766 $1,766 $1,766 Annual O&M Costs $284 $264 $284 $264 $264 Total Oiher Costs $2,050 $2,050 $2,050 $2,050 $2,050 Total Cost_of Power $1,898 $2,106 $2,407 $2,559 $2,540 $2,405 $2,467 $3,081 $3,116 $3,152 $3,183 $3,213 Sale of Surplus Solomon Guich Energy Surplus Energy Revenues trom Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,808 $2,106 $2,497 $2,559 $2,540 $2,405 $2,467 $3,081 $3,116 $3,152 $3,183 $3,213 Present Value in 1903 Dollare Cummulative (1993-2017)$41,016 j(in th de) 30_year (2018-2047)with "no additional growth”$16,434 j(in th ds) Total_Net_Present Value I $57,449 |(In_thousands) 4:43 PM Page 1 2/21/04 Medium Construction 2205 2008 2co2 2011 2012)2013 2014 2015 2016 Diese!Coste $620 $704 $730 $782 $809 $836 $863 $800 $917 $045Fuel [Variable OAM $117 $131 $136 $146 $151 $157 $162 $168 $174 $170 ($146)($146)($146)($146)($146)($146)($146)($146)($146)].($146)Existing Diese!O&M Adjustment Additional Building &Equip New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diese!Capitat Costs $567 $567 $567 $567 $567 $567 $567 $567 $567 $567 $1,192 $1,282 $1,312 $1,375 $1,407 $1,440 $1,472 $1,504 $1,537 $1,570TotalDiese!Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs E y Energy” Total intertie Coste Allison Lake $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766AnnualCarryingCharge Annual O&M Costs $284 $284 $264 $284 $284 $284 $284 $284 $204 $284 $284 $204 $284 Total Other Costs $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $3,242 $3,272 $3,302 $3,332 $3,362 $3,395 $3,425 $3,457 $3,490 $3,622 $3,654 $3,587 $3,620TotatCostofPower Sale of Surplus Sotomon Guich Ene Surplus Enemy Revenues from Sale District Heat Net Revenue (Coal Case $3,272 $3,302 $3,332 $3,362 $3,305 $3,425 $3,457 $3,490 $3,622 $3,654 $3,587 $3,620NetAnnualCostofPower$3,242 4:43 PM Page2 2/21/94 Allison Lake OCRA -Division of Energy:Copper Valley Intertie Feasibility Study | Medium Load;High Fuel Economic Analysis (Constant 1993 Dollars -All Costs In Thousands of Dollars) Medium Construction 1993 1994 12998 1996 1997 1998 1999 2000 2901 20202 2003 2004 Diesel Costs Fuel $1,144 $1,202 $1,665 $1,675 $t,700 $1,661 $1,720 $554 $507 $642 $685 $727 Variable O&M $764 $8356 $965 $7090 $633 $4090 $320 $92 $907 $103 $108 $112 Existing Diesel O&M Adjustment ($146)($146)($146)($146)($146) Additional Building &Equipment New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Costs $142 $283 $425 $567 $567 $567 $567 $567 $567 Total Diese!Costs $1,808 $2,126 $2,649 $2,642 $2,651 $2,641 $2,633 $1,003 $1141 $1,192 $1,239 $1,286 Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Enetgy Total intertio Costs Allison Lake : Annual Carrying Charge $1,766 $1,766 $1,766 $1,766 $1,766 Annual O&M Costs $284 $284 $204 $284 $284 Total Other Costs $2,050 $2,060 $2,060 $2,050 $2,050 Total Cost of Power $1,898 $2,128 $2,549 $2,642 $2,651 $2,541 $2,633 $3,143 $3,101 $3,242 $3,289 $3,336 Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,808 $2,128 $2,549 $2,642 $2,651 $2,541 $2,633 $3,143 $3,101 $3,242 $3,280 $3,336 Present Value In 1993 Dollars Cummulative (1903-2017)$43,142 [(in_thousands) 30 year (2016-2047)with "no additional growth"$18,572 I(in_thousands) Total Net Present Value f $61,714 [(In_thousends) 4:41 PM Page 1 2/21/04 Attieon Lake [Medium Load:High Fuel {Medium Construction .2005 2006 2007 2008 2009 2010 2011 2212 2014 2015 Diesel Costs : Fuet $770 $14 $860 $907 $956 $1,009 $1,060 $1,114 $1,171 $1,229 $1,289 $1,951 $1,415 Variable OAM $tt7 $122 $126 $191 $136 $141 $146 $154 $167 $162 $166 $174 $179 Existing Diesel O&M Adjustment ($146)($146)($146)($146)($146)($146)($146)($146)($146)($146)($146)($146)$146 Additional Building &Equip New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Costs $567 $567 $567 $567 $567 $567 $567 $567 $567 $567 $567 $567 $567 Total Diese!Costes $1,333 $1,382 $1,433 $1,485 $1,538 $1,597 $1,652 $1,712 $1,775 $1,638 $1,904 $1,971 $2,041 Total Conservation Cost Intertle Cost Annual Carrying Charge Annual O&M Costs E y Energy Total Intertie Costs Alison Lake Annual Carrying Charge $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 Annual O&M Costs $204 $284 $284 $284 $204 $284 $204 $204 $264 $294 $204 $204 $284 Total Other Costs $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 Total Cost_of Power $3,363 $3,432 $3,489 $3,635 $3,688 $3,647 $3,702 $3,762 $3,825 $3,688 $3,954 $4,021 $4,091 Sate of Surplus Solomon Guich Ene' Surplus Energy Revenues from Sale Oistrict Heat Net Revenue (Coal Case iNet Annual Cost of Power $3,383 $3,432 $3,483 $3,535 $3,580 $3,647 $3,702 $3,762 $3,626 $3,886 $3,954 $4,021 $4,091 4:40 PM Page 2 2/21/04 Allison Lake DCAA -Division of Energy:Copper Valley intertie Feasibility Study { High Load;Medium Fuel Economic Analysis (Constant 1993 Dollars -Ait Costs in Thousands of Dollars) Medium Construction 1993 1994 {995 1996 1997 1998 1999 2209 2001 2002 2003 2204 Digeo!Costs Fuel $1,144 $1,271 $1,613 $1,502 $1,697 $1,636 $1,792 $833 $9890 $1,136 $1,260 $1,423 Variable O&M $754 $835 $985 $700 $633 $457 $452 $158 $tot $221 $251 $281 Existing Diese}O&M Adjustment Additional Building &Equipment New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Costs $142 $283 $425 $567 $567 $567 $567 $567 $567 Total Diesel Costs $1,808 $2,106 $2,407 $2,559 $2,540 $2,545 $2,837 $1,584 $1,772 $1,050 $2,124 $2,207 Total Conservation Cost tntertle Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertle Costs Allison Lake Annual Carrying Charge $t,766 $1,766 $1,766 $1,766 $1,766 Annual O&M Costs $264 $284 $284 $284 $284 Total Other Costs $2,050 $2,050 $2,050 $2,050 $2,050 Total Cost of Power $1,698 $2,106 $2,497 $2,559 $2,540 $2,545 $2,837 $3,634 $3,622 $4,000 $4,174 $4,347 Sale of Surptus Solomon Guich Energy Surplus Energy Revenues trom Sale District Heat Net Revenue (Coa!Case) Net Annual Cost of Power $1,696 $2,106 $2,497 $2,650 $2,540 $2,545 $2,837 $3,634 $3,822 $4,000 $4,174 $4,347 Present Value In 1993 Dollare Cummulative (1003-2017)$46,771 {(in_thousands) 30 year (20186-2047)with "no additional growth®$16,327 |(in_thousands) Total Net Present Value I $65,098 |(in thousands} 1:59 PM Page t 2/20/04 Allleon Lake High Load;Medium Fuel Medium Construction 2005 2008 2009 2210 2012 2913 £015 2015 Olesel Costs Fuel $942 $964 $974 $oas $991 $1,002 $1,007 Variable O&M $286 $310 $318 $326 $341 $350 $366 $374 Existing Diesel OAM Adjustment Additional Building &Equipment New Diesel Fixed O&M $26 $26 $26 $26 $26 $26 $26 $26 New Diese!Capital Costs $567 $567 $567 $567 $567 $567 $567 $567 Total Diesel Costs $1,821 $1,866 $1,879 $1,899 $1,919 $1,933 $1,960 $1,974 Tota!Conservation Cost Intertle Cost Annuat Carrying Charge Annual O&M Costs Eoonony Energy Total intertie Costs Allison Lake | $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766AnnuatCarryingCharge Annual OAM Costs $284 $264 $284 $284 $284 $284 $284 $284 $284 $284 $284 $284 $284 Total Other Costs $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050$2,050 Total Cost_of Power $3,871 $3,691 $3,004 $3,916 $3,929 $3,043 $3,956 $3,069 $3,083 $3,906 $4,010 $4,024 $4,037 Sale of Surplus Solomon Guich Energy Surplus Enemy Revenues from Sate District Heat Net Revenue (Coal Case) Net Annual Cost of Power $3,871 $3,691 $3,904 $3,916 $3,029 $3,943 $3,956 $3,969 $3,983 $3,006 $4,010 $4,024 $4,037 1:68 PM Page2 2/20/94 Allison Lake DCAA -Division of Energy:Copper Valley Intertie Feasibility Study High Load;High Fuel Economic Analysis (Constant 903 Dollars -Ail Costs in Thousands ol :ss) Medium Construction 4993 1924 1995 1996 1997 1998 1999 2200 2001 2202 2203 2004 $1,144 $1,202 $1,565 $1,675 $1,700 $1,762 $937 $1,131 $1,322 $1,615 $1,713 Variable O&M $754 $835 $985 $709 $633 $457 $158 $191 $221 $251 $281 Existing Diesel O&M Adjustment Additional Building &Equipment New Diesel Fxed O&M $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capital Costs $142 $283 $425 $567 $567 $667 $567 $567 Total Diesel Cosis $1,698 $2,128 $2,549 $2,642 $2,651 $2,689 $1,688 $t,014 $2,136 $2,359 $2,587 Total Conservation Cost Intertle Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total intertie Costs Allison Lake Annual Carrying Charge $t,766 $1,766 $1,766 $1,766 $1,766 Annual O&M Costs $284 $284 $284 $284 $284 Total Other Costs $2,060 $2,050 $2,050 $2,050 $2,050 Total Cost of Power $1,808 $2,128 $2,549 $2,642 $2,651 $2,660 $3,028 $3,738 $3,964 $4,186 $4,409 $4,637 Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale Oistrict Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,808 $2,128 $2,640 $2,642 $2,651 $2,689 $3,028 $3,738 $3,064 $4,186 $4,400 $4,637 Present Value in 1993 Dollars Cummulative (1993-2017)$40,581 (in_th di $20,619 (In_th d30year(2016-2047)with "no additional growth®lTotal_Net_Present Vatue $70,180 (Iin_thousande )] ) 1:40 PM Paget 2/20/04 Allison Lake High Load;High Fuel Medium Construction 2005 2008 2009 £015]__2216]2b t7Diese!Coste Fuel $1,163 $1,241 $1,269 $t,298 $1,484 $1,516 Variable OAM $286 $310 $318 $326 $366 $374 $362 Existing Diesel O&M Adjustment Additional Building &Equipment New Diesel Fixed O4M $26 $26 $26 $26 $26 $26 New Diesel Capital Coste $567 $567 $567 $567 $567 $567 $567 Total Diesel Costs $2,032 $2,144 $2,179 $2,216 $2,450 $2,492 Totat_Conservation Cost Intertie Cost Annual Carrying Charge Annual OAM Coste E y Energy Totat Intertie Costs Allison Lake Annual Carrying Charge $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 $1,766 Annual O&M Costs $204 $284 $264 $284 $284 $284 $284 $204 $204 $204 $284 $284 $284 Total Other Costs $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 Total Cost _of Power $4,082 $4,124 $4,159 $4,194 $4,229 $4,266 $4,303 $4,341 $4,380 $4,419 $4,459 $4,500 $4,542 Sale of Surplus Solomon Gulch Ener, Surplus Enemy Revenues trom Sale District Heat Net Revenue (Coal Case Net Annual Cost of Power $4,082 $4,124 $4,159 $4,104 $4,229 $4,266 $4,303 $4,341 $4,380 $4,419 $4,459 $4,600 $4,642 1:56 PM Page 2 2/20/04 CVEA | Summary of Economic Analysis Results Revision 1.0 to DFS [|| Cummulative Present Value of Comparable System Costs (1993 $000) Medium Cost}High CostscorerDFSDieselintertieAllisonLake|Allison Lake Low Load Growth Medium Fuel $31,329 $69,198 High Fuel $35,588 $71,974 | Medium Load Growth Medium Fuel $58,142 $57,449 $64,033 Low Cost Int.$62,404 Med Cost Int.$76,647 High Cost Int.$87,659 High Fuel $67,496 $61,714 $68,298 Low Cost Int. . $66,912 ' Med Cost Int.$81,156 High Load Growth Medium Fuel $72,774 $65,098 $71,682 Low Cost Int.$72,151 Med Cost Int.$86,394 High Fuel $85,871 $70,180 $76,764 Low Cost Int.$78,517 Med Cost Int.$92,761 5:10 PM Page 1 2/21/94 Schedule INT-1 CVEA Intertie Summary of Project Cost Estimates ___ Transmission |Transmission WALineLineayConstruction|Construction \/ Labor Cost/Mile Cost Pioject Cost Scenario:Hours |(1993$000)|_(1993$)1993$) Low 136,000 $255 |$34,112,928 |$45,930,519 Medium 187,500 $351 $47,133,175 |$61,948,830 High 250,000 $433 |$58,074,148 |$74,377,775 \ Notes:\ Low \LZ. -_|Draft Feasibility Study Estimate Medium Adjust labor hours to middie of independent estimates Adjust helicopter hours same proportion as labor hours Fully Loaded labor =$125/hr Heavy Helicopter =$3341/hour B3 Substation -include 250K for Communications Systems C4 Engineering at 3%of Transmission Line Construction Construction Management at 6% Owner Costs at 4% High Adjust labor hours to high end of independent estimates Adjust helicopter hours same proportion as labor hours Fully Loaded labor =$125/hr Heavy Helicopter =$3341/hour B3 Substation -include 250K for Communications Systems C4 Engineering at 3%of Transmission Line Construction Construction Management at 6% Owner Costs at 4%| 12:33 AM 2/22/94 ay CVEA Intertie -Project Cost Estimates CVEA Intertie Review Construction Cost for Reasonableness 2|Breakdown Route D Estimate from Exhibit C-1 Material -Installation Zone 1 $2,960,598 $5,408,080 Zone 2 $5,374,186 $8,172,386 Zone 3 $2,679,760 $5,217,691 Zone 4 $502,752 $1,004,515 $11,517,296 |$19,802,672 Subtotal=$31,319,968 ROW =$2,792,960 Total =$34,112,928 |ck 3 Adjust labor to average fully loaded labor rates Adjust hours to mid range of estimates Cost P&LH Hours HH Hours|P&LH Rate HH Rate:M Material $11,517,296 R ROW $2,792,960 Helicopter $2,612,436 782 $3,341 Labor $23,437,500 187500 $125 Heli+Labor $26,049,936 5%|Mobilization $1,302,497 Subtotal $27,352,433 20%/Contingency $5,470,487 Tl Total Installation $32,822,919 A.}Transmission Const.$47,133,175 |[M+R+T1] Per Mile =$351,740 1,399 6 Substations .. B1 $1,824,316 B2 $1,793,903 B3 $250,000 |Communications System Engineering Ci $1,339,900 C2 $700,000 C3 $35,000 3%C4 $1,413,995 cs $350,500 Environ,ROW &Permitting 01 $125,000 D2 $10,000 D3 $100,000 D4 $40,000 D5 $65,000 D6 $371,000 SUBTOTAL=>$55,551,789 Construction Management $3,333,107 6% Owner Costs |$2,222,072 4% Contingency on Non-Construction $841,861 10% TOTAL Project Cost Estimate $61,948,830 12:35 AM 2/22/94 Labor Hour Review CVEA Intertie Teneneseon Line Installation Review reasonable fully loaded labor 1/Use hour estimates provided in Exhibit C-1 2|Separate hours into two categories:1)Personnel &Light Heli;2)Heavy Hell 3|Mukiply those categories by "typical fully loaded labor rates” 4|Total hours do not match DFS totais. Personnel &||Heavy Light Heli Heli 'Description Hours Hours 1 A 10187 §9 B 14219 27 Cc 1642 12 D 3886 *] E 8747 39 Subtotal 38681 137 2 A 14651 79 B 17351 41 Cc 1840 11 D 5785]0 E 16203 128 Subtotal §5830 259 3 A 9529 64 B 12308 24 Cc 1979 16 D 3414 0 E 9285 41 Subtotal 36515 145 4 A *1542 13 B 2079 12 Cc 110 1 D 238 8) E 2353 6 Subtotal 6322 32 TOTAL HOURS 137,348 §73 Avg.Rate $125 $3,341 Installation $17,168,500 $1,914,393 5%|Mobilization $858,425 $95,720 Subtotal $18,026,925 $2,010,113 20%{Contingency $3,605,385 $402,023 TOTAL __INSTALLATION TOTAL INSTALLATION $21,632,310 $2,412,135 $24,044,445 12:37 AM 2/22/94 CVEA Intertie -Construction Costs 12:40 AM CVEA Intertie | Review Construction Cost for Reasonableness 1 1|Review Table VI-6:Tabulation of Historic Transmission Line Construction Costs Approx. Cost/Mile Approx.Const.Cost |Table VI-5 Selected Comparison Projects (1993$000)Length (mi.){|(1993$000) 1 $123 17.7 $2,177 2 $113 3.9 $441 3 $180 6.5 $1,170 4 $142 4.2 $596 5 $155 20.5 $3,178 . 6 $667 30.5 $20,344 $667 30.5 $20,344 7 $187 12.5 $2,338 : 8 $147 7.4 $1,088 9 $144 24.0 $3,456 10 $163 26.2 $4,271 11 $222 55.8 $12,388 12 $453 50.1 $22,695 13 $438 68.2 $29,872 $438 68.2 $29,872 14]$983 17.4 $17,104 15 $571 11.0 $6,281 16 $251 20.1 $5,045 17 $568 97.0 $55,096 18 $563 72.0 $40,536 19 $530 34.0 $18,020 $530 34.0 $18,020 20 $257 60.0 $15,420 Mile Wtd Average =$409 639;$261,514 $514 132.7 $68,235 OFS estimate=$254 134 $34,113 $254 134 $34,113 Variance =($155)($260) -38%-51% DFS Estimates appear considerably weer than average of sample provided 2/22/94 High Load,Medium t uel ECONOMIC Analysis (UONSIUR Iw¥d LOIS -Al LUSis It IMuusdius Ul UUlds) Medium Construction 1923 1994 1995 1996 1997 1998 1999 2200 200)20902 2003 2204 Diesel Costs Fuel $1,144 $1,271 $1,613 $1,502 $1,607 $1,638 $1,702 $833 $es0 $1,136 $1,280 $1,423VasiableO&M $754 $835 $085 $709 $633 $457 $452 $158 $101 $221 $251 $281 Existing Diesel OAM Adjustment Additional Bullding &Equipment New Diesel Fixed OAM $26 $26 $26 $26 $26 $26 $26 $26 $26 New Diesel Capttal Costs $142 $283 $425 $567 $567 $567 $667 $567 $567 Total Diesel Costs $1,608 $2,106 $2,407 $2,559 $2,540 $2,545 $2,837 *$1,584 $1,772 $1,050 $2,124 $2,207 Total Conservation Cost Intertio Cost Annual Carrying Charge Annual O&M Costs Economy Enerpy Total intertle Costes Allison Leke Annual Carrying Charge '$1,766 $1,766 $1,766 $1,766 $1,766 Annual O&M Costs $284 $284 $204 $264 $284 Total Other Costs $2,050 $2,050 $2,050 $2,050 $2,050 Total Cost of Power $1,808 $2,106 $2,407 $2,559 $2,540 $2,545 $2,837 $3,634 $3,622 $4,000 $4,174 $4,347 Sale of Surplus Sol Gutch Energy Surplus Energy Revenues from Sale District Heat Net Revenue (Coal Case) Net Annual Cost of Power $1,608 $2,106 $2,407 $2,550 $2,540 $2,645 $2,837 $3,634 $3,822 $4,000 $4,174 $4,347 Present Value In 1903 Dollare Cummulative (1093-2017)$46,771 j{in th de) 30 year (2018-2047)with "no additional growth"$108,327 I(in_thousandsTotalNetPresentValue|I $65,008 (in th ds)- e 1:50 PM Page t : .2/20/04 CVEA intertie -Construction Costs CVEA Intertie I Review Construction Cost for Reasonableness | 1|Review Table Vi-6:Tabulation of Historic Transmission Line Construction Costs Approx. Cost/Mile Approx.Const.Cost |Table Vi-5 Selected Comparison Projects (1993$000)Length (mi.)|(1993$000) 1 $123 17.7 $2,177 2 $113 3.9 $441 3 $180 6.5 $1,170 4 $142 4.2 $596 §$155 20.5 $3,178 "6 $667 30.5 $20,344 $667 30.5 $20,344 7 $187 12.5 $2,338 8 $147 7.4 $1,088 9 $144 24.0 $3,456 10 $163 26.2 $4,271 \ :11 $222 55.8 $12,388 12 $453 50.1 $22,695 13 $438 68.2 $29,872 $438 68.2 $29,872 14 $983 17.4 $17,104 15 $571 |-17.0 $6,281 16 $251 20.1 $5,045 17 $568 97.0 $55,096 18 $563 72.0 $40,536 : 19 $530 34.0 $18,020 $530 34.0 $18,020 20 $257 60.0 $15,420 : Mile Wt'd Average=$409 639 $261,514 $514 132.7 $68,235 DFS estimate=$254 :134 $34,113 $254 134 $34,113 Variance =($155)($260) -38%"51% DFS Estimates appear considerably lower than everage of sample provided 12:40 AM 2/22/94 Com misstomesy-Cagat blak hSy February 19,1994} The draft report for the Copper-Valley Intertie is out.As a big gameguidedependentontouristdollars,and a resident of Chickaloon,I'm not Satisfied with R.W.Beck And Associates'conclusions.The intertie cost analysis makes many assumptions which reports of this nature must,thequestionis,are they accurate?We residents of Chickaloon and Sutton have reason to believe they aren't. The report gives short thrift to the alternatives which appear to be mere straw men. The helicopter dependent construction costs are estimated to be only half what the Bradly Lake helecopter dependent costs were "without"adding in Clearing costs. Right of way acquisition costs are clearly underestimated since the original Athabascan hunter-gatherer land owners are adamantly against the project.; Of the six scenarios looked at in the report only one -the intertie - affects the upper Matanuska valley.The other five impact only the Copper valley where the power would be used.This is an important factor not adequately addressed in the report. Interestingly,the effects of promoting conservation through energy efficiency were only applied to their present power generation system. Conservation measures "weren't"applied to the others.This is significant when the report can only show clear intertie superiority for high electrical loads.These high loads also depend on a huge increase in electrical needsbythePetroStarRefineryinValdez.Petro Star could,and quite possibly will,produce their own power cheaper just as Alyeska already does at theValdezTerminal. ; 'The intertie doesn't promise lower electrical rates for Copper Valley customers,and it also doesn't promise that MEAs'customer rates wouldn't end up higher because of it.. There is,however,one promise.If the intertie is boondoggled through,the upper Matanuska valley /Chickaloon Pass highlands will be visually and culturally compromised for our lifetimes. Sincerely,Kar[BracudelMisia.ko Spt P.O.Box 1148 _Chickaloon,Alaska 99674 agijEMicaa"HAR108 49993 ec REGIONS AFFAIR VERONICA SLAJER P.O.Box 101293,ANCHORAGE,AK 99510 WorK PHONE:272-3034 ©HOME PHONE:274-9974Pecrnug i MARi03 1993 COMMISsIUN:No UPCOMMUNITY@REGIONALAFFAIRS February 25,1994 Herv Hensley Acting Director,Division of Energy Department of Community and Regional Affairs 333 West Fourth Avenue,Suite 220 Anchorage,Alaska 99501 Dear Mr.Hensley: As a lifelong Alaskan,I'm concerned about Alaska's financial future and feel we needtoavoidspendingstatemoneyonmorecapitalprojectswithoutadequateassurances of viability.|believe all state-funded projects need to be based on conservative growth and demand projections,especially with state revenues dropping in the future. The recently released draft Copper Valley Intertie Study has its demand alternatives skewed to inappropriately high levels.Substantial growth in the Petro Star refinery load over the next 50 years should only be represented in the highest-case alternatives,as their source of raw material is the same declining oil resource. The alternative of the Allison Lake project needs to be further investigated.It would produce clean energy with much less impact on the residents of the Copper Valley region.It would be a relatively affordable project more likely to meet the realistic energy demands of the region.Residents of the Copper Valley area want more affordable electricity;they don't care which project it comes from.The political support generated for the Copper Valley Intertie is based on the misperception that the funding will be lost if the intertie isn't built.Of course,the money could be reappropriated to the most cost-efficient alternative. |hope you will remain diligent in pursuing the most cost-effective alternative to achieving our state's energy goals.Thank you for considering my comments in yourfinalreport. Sincerely,QoseronicaSlajer cc:Honorable Walter J.Hickel,Governor of Alaska Honorable Edgar Blatchford,Commissioner,DCRA Honorable Cynthia Toohey,Representative,Alaska State LegislatureHonorableLorenLeman,Senator,Alaska State Legislature Ray Cammisa 310 Stewart St. Anch.AK.99508 Director RECEIVED Division of Energy, Dept.of Community &Regional Affairs | MAR 31 1994 333 W.4th Avenue,Suite 220 DIVISION OF ENERGY/DCRA Anchorage,AK>99501 The issue of the Sutton to Glennallen Intertie,seems pretty simple.It is simply not cost effective for the consumer,or for the people of Alaska. The interie's entire economic feasibility depends on the assumed massive increases in the load of a single industrial customer,Petro Star Refinery.There is no substantial proof that there will be that growth.The refinery would have to quadruple its power needs for the intertie to become the most economical way to support power.It is shocking that there is no justification given to support Petro Star's load growth.. If this project were being built by the private sector,P.S.would be required to sign a "take or pay"contract with builders of the line | for the amount of electricity it claims it will need.Shouldn't the citizens of Alaska demand the same protection. Most importantly is that the people of Alaska cannot afford to subsidize an oil refinery's electric needs,especially in light of the States $2.2 billion budget crisis.The $35 million,O-interest 50-year loan basically amounts to a $76 million give-away program.This is unacceptable to me as it should be to you. Thank-you Ray Cammisa |meres?Ia d¢Good dep ,ep he duthewy --Qeummalams sabreSeRECEIVED-- A aie 4 MAR 16 1994alongAhoGtunnghureeypacks*cluatrow misey OF ENEney nomaphedeaatiyswhatPepoodegmohio,Atoake, Jute ap tee Shamb-qou(a Linda:Rutledge ©BoxF!-vt atoopatCanter"Ae. 1 . e °'Q. ae "- opperValley .Etectrit®Asseration Member ne, JULIAN L.MASON III 1130 WEsT SIXTH AVENUE,SUITE 100 ANCHORAGE,ALASKA 99501 (907)276-4331 February 17,1994 The Honorable Walter J.Hickel P.O.Box 110001 Juneau,Alaska 99811-0001 Dear Governor Hickel: Please do what you can to stop the Sutton to Glennallen intertie.The intertie does not make economic sense. Copper Valley Electric has about 3,000 customers.If the construction cost per mile is the same as the cost for the Bradley Lake line,the cost will be at least $120 million --$40,000 per customer!This cost is enough to pay the average residential bill for 30 years or more.This is not a sound investment of the State's scarce economic development dollars. Very truly yours, ara [-A-__ian L.Mason JLM:sjw \4 FEB251994\ECEIW EE) GOVERNOR'S OFFICE bee Paul F.Twardock 1237 W llth Anchorage AK 99501 907-279-0409 2-20-94 Gov.Wally Hickel PO Box 110001 Juneau AK 99811-0001 Dear Gov.Hickel, I would like to express my displeasure of the Sutton to Glennallen Intertie Draft FeasibilityStudy.The preferred altemative in the draft should not be picked because: 1.Economic Unfeasibility;The intertie option has costs which have not been included in the draftfeasibilitystudy.Economic costs such as lost tourism business,health costs.loss of subsistencehunting/fishing with increase pressure on fish'wildlife,and maintenance costs.Furthermore social costs have also been ignored,costs such as disruption of communities along the route.Based on the report itself the intertie is only justified if power quadruples at Petrostar.Thewholeproject's rationale according to your representatives at public meetings is based onPetrostar's needs.I object to such a project being pushed through at the public's expense for onecommercialventure.CVEA ought to be required to factor paying the whole costs of the project.including interest on the approved loan., Finally I wonder are the costs of the study realistic?I am quite familiar with the area andwonderwhysnowavalanchesarenotmentionedinthereportasahazardwhichwillcostsignificantamountstostudy,plan for,and build adequate structures to withstand.That is the onlycostIamfamiliarwith,but wonder why the Bradley Lake project cost so much more per mile thanthisstudyindicatesthisintertiewillcost? 2.Environmentally Unfeasibility:The intertie goes through some of the most scenic country inthisstatewhichisaccessiblewithouthavingtoflyto.The communities along the road have everyrighttoobjecttosuchaneyesorethroughtheirbackyards.I object to having the same eyesorethroughthemountainswhichareanimportantareatome,both recreationally and as a professionalguide.The health concerns of local residents reflect my concerns as I lead groups in and aroundtheproposedroute.The disturbances to wildlife,both by the project itself and increased access itwillprovide,will also ruin the area in my eyes.. 3.Reasonable Alternatives:The plan does have alternatives to the intertie which make sense for _this state.Petrostar,like Alyeska,should be asked to provide its own power.(It seems ludicroustomethatinN.-America's richest petroleum city they cannot do this).Then the conservationalternativeoughttobeconsideredinconjunctiontotheAllisonLakeprojectand/or new diesel generators. I urge you to reject this study and go back to the drawing board.I cannot stress how strongly I feelthatanintertie1snotwantedorneeded. Sincerely,e WE |Vesela Re oes DPaulTwardock GOVERNOR'S OFFICE RECEIVED MAR 11 1994 March 9,1994 DIVISION OF ENERGY/DCRA Robert E.Harris,Director Division of Energy Department of Community and Regional Affairs State of Alaska 333 W.4 th Avenue,Suite 220 Anchorage,AK 99501-2341 Dear Mr.Harris: |am writing to you to voice my concerns about the proposed Copper Valley Intertie.| am very concerned about the number of development proposals being put forward by the State of Alaska,local government bodies and politically connected groups throughout the state.My concern stems from the long term economic costs of such projects.Many appear to be very positive projects from the point of view of easy state funding for construction.However,the long term costs to the average citizen are rarely addressed.In the case of this proposed Copper Valley Intertie project,it seems obvious to me that the citizens who are linked to the Intertie will bear the substantial burden of subsidizing isolated users for many,many years.|believe these cost are grossly underestimated in this case. |also believe that the environmental impacts are much too great for the small number of users.In all probability this Intertie will have a significant negative impact on one of the most beautiful sections of the limit highway system while requiring public subsidy. This is a lose-lose situation.Especially since these environmental impacts will eventually impact tourism dollars. Thank you for this opportunity to respond to your study.Please notify me of any future meeting or reports concerning this proposed project. Sincerely, 21.Ko nwrch John M.Kennish 12821 Chapel Drive Anchorage AK 99516-2614 ALASKA COGENERATION SYSTEMS,INC. February 7,1994 Mr.Robert E.Harris Executive Director Division of Energy Department of Community and Regional Affairs (DCRA) RE:Comments -Draft Report,Copper Valley Intertie Feasibility Study I have reviewed the draft report of the Copper Valley Intertie Feasibility Study and find -the study either fails to address or inadequately addresses the following items: 1.Table I-1,Page I-7,Substations -No contingency for substation construction is included.A 10%contingency for substations would increase cost by approximately$360,000. Table I-1,Page I-7,Right-of-Way Acquisition -The $371,000 the study included for right-of-way acquisition is totally inadequate.A more realistic figure would be 2-1/2 to 3 times that amount.Also,I don't believe there is any right of imminent domain across native lands.Acquisition of native lands,private lands and mining claims could significantly increase the cost of the right of way,especially in light of recent court rulings which allow increased recovery by land owners for fear of EMF,even when the perceived fear of EMF is irrational and not supported by scientific evidence (See attached case law). Table I-1,Page I-7,add new line item titled Legal Fees -Several groups have already threatened law suits to block construction of the line.It is only appropriate some reasonable amount be included to cover this contingency. Table I-1,Page I-7,add new line item titled SVC station -The results of the electrical study indicate an SVC station must be constructed for the transmission line to operate properly and provide reliable and quality electrical service to CVEA consumers.Even if the SVC station is not constructed for a few years,the cost should be included in the overall cost of the transmission line.To do otherwise would amount to an intentional misrepresentation of the total cost of the line and the corresponding cost of power to CVEA consumers.An SVC station would probably add another 4-5 million to the overall cost of the transmission line. HAARP Load -CVEA has argued the transmission line is needed to serve the HAARP project,should it ever become fully operational.However,after reviewing the electrical studies it would appear the transmission line could not adequately serve 229 Whitney Road «Anchorage,Alaska 99501 ¢(907)278-7283 «©FAX (907)278-7448 -Comments -Copper Valley Intertie Page 2 of 3 the 4-5 megawatt load swing associated with the fully operational HAARP project,even with the addition of an SVC system. 6. 10. 11. 12. Reliability -The subject of reliability has not been adequately addressed.The Glennallen to Valdez transmission line has been out of service for a cumulative period of approximately one year since its construction due to avalanche damage.This represents an average forced outage rate of 7-8 percent.Additional forced outages will occur on the Sutton-Glennallen section of the line,further increasing the overall forced outage rate experienced by CVEA consumers.A reasonable availability factor should be assigned to the transmission line and used when calculating the cost of the transmission line alternatives in the same manner a plant availability factor was used in calculating the cost of the coal plant alternative. Avalanche Hazard and Mitigation Measures -This item and its impacts on cost and reliability have been inadequately addressed. Estimated Cost of Power,Table X-5,Page X-17 -It is not possible to determine how these numbers were derived from the information contained in the report.A detailed explanation should be included. Is the cost of power in the intertie alternatives based on the purchase of firm or non-firm power from the railbelt? Appendix H,Review of Glennallen Coal-Fired Generation Plant -R.W.Beck has overstated the cost of the coal plant by approximately 10 percent and overstated the number of plant personnel required to operate the plant by four.Only 12 people would be required to operate the plant since all administrative and management functions would be performed by the Owners of the plant. Valdez Clean Coal Project -The proposed coal plant is being relocated from Glennallen to Valdez.A short report which describes the Valdez Clean Coal Project,construction cost estimates and operating costs associated with the relocated plant will be provided for input into the final report.A executive summary of the report is attached and shows the Valdez Clean Coal Project can provide the lowest cost power to CVEA. Appendix J,Resource Model Outputs -These models do not represent the "true”present value cost of the alternative investigated.The models apply a $560,000 a year credit in the intertie alternatives as an offset for not operating the diesel plants.There should not be acreditoffsetincludedinthemodels,as no one is paying CVEA $560,000 a year not tooperateitsdieselpowerplants.This credit offset should be set at zero and all other models adjusted appropriately.Using such an offset under estimates the present value of the intertie by the present worth value of $560,000 multiplied by the length of the study period. Furthermore,applying a $560,000 a year credit will understate the cost of power for the intertie cases as listed in Table X-5,Page X-17 by approximately one cent per kwh. Comments -Copper Valley Intertie Page 3 of 3 13.Lake Louise Road Viewshed -The visual impact of the line on the viewshed along the Lake Louise Road has been underestimated.The line could be visible for miles in either direction of travel on the road,and if not carefully sited,skylighted against the Chugach Mountains when travelling south on the roadway.At certain points along the Lake Louise road,four mountain ranges are visible,the Chugach,Talkeetna,Wrangell and Alaska Range.As a previous resident of Glennallen I can assure you the view from the LakeLouiseroadisoneofthemostspectacularandunblemishedviewsintheCopperRiver Basin,if not in Alaska.It would indeed be an insult to our social conscious to spoil this spectacular view by an ill placed powerline. 14.DCRA should not recommend the construction of the intertie if it is only economically feasible at the high load growth scenario.If the high load growth does not materialize, CVEA consumers will be forced to pay higher rates for their power than necessary. Sincerely, Frank J.Deb [EmreJ.D.President Encl.(2) ;4 ALASKA COGENERATION SYSTEMS,INC. PROPOSAL for the VALDEZ CLEAN COAL PROJECT offered as A Resource Option for COPPER VALLEY ELECTRIC ASSOCIATION for evaluation by Division of Energy Department of Community and Regional Affairs (DCRA) Mr.Robert E.Harris Executive Director & R.W.Beck and Associates Mr.John L.Heberling |Principal Engineer February 1994 229 Whitney Road «Anchorage,Alaska 99501 *(907)278-7283 *FAX (907)278-7448 SECTION I VALDEZ CLEAN COAL PROJECT EXECUTIVE SUMMARY Executive Summary Hobbs Industries,Inc.("Hobbs")had originally proposed to construct and operate an 11 MW coal-fired generation project in Glennallen,as a resource option,for meeting the long term power needs of Copper Valley Electric Association (CVEA).However,after joining with other experienced utility and generation engineers to form Alas- _ka Cogeneration Systems,Inc.(ACSD specifically for the purpose of devel- oping Alaska Cogeneration project opportunities,we determined through review and evaluation of recent studies that siting the Project in Valdez, CVEA's major load center,produced a substantial economic advantage over other potential resource options,in- cluding the CVEA/MEA Intertie. ACSI has also determined that by relocating the Project to Valdez,it can construct a plant with an installed 14.0 Estimated Cost of Power Medium-High Load,Med.Fuel Graph1 Zere InterestStateLoan 12.0 + 10.0 Cents/KWHPpPPFwfQor-]7eo|EE Vatdez Coal Project EJ Allison Lake generation capacity of 22 megawatts for basically the same cost of constructing a 11 megawatt plantin Glennallen.Thisis directly attributable to stable sub-soil conditions and high quality Estimated Cost of Power Medium-High Load,Med.Fuel .Six Percent Interest Loan 20.0 Graph2 0.0 water which will substantially reduce the Project's foundation costs and water treatment equipment costs. ACSI has computed the cost of electrical energy for the Valdez Coal Project based on the economic as- sumptions and parameters contained in the Copper Valley Intertie Feasibility Study,prepared by R.W.Beck and dated January 1994.The results of the calculations are graphically illustated in Graphs 1 and 2.The graphs compare the cost of power for the Valdez Coal Project with.Allison Lake and the|EE Valdez Coal Project [24 Allison Lake Eel intertie ;Intertie for a zero interest state loan, Executive Summary -February 94 I-1 SECTION I VALDEZ CLEAN COAL PROJECT EXECUTIVE SUMMARY and at an interest rate of six percent,for the Med-High Load,Med.Fuel scenario contained in the feasibility study.The costs of power for Allison Lake and the Intertie were obtained fromtheIntertieFeasibilitystudy.The graphs clearly show the Valdez Coal Plant to be the least costoptionforsupplyingthefuturepowerneedsofCVEA.A comparison of Graphs 1 and 2,also reveals the Valdez Coal Plant can provide lower cost power at a six percent financing rate than the Intertie can provide with a zero interest state loan.Althought not shown,the Valdez Coal Project is also the least cost option for the Med-Low Load,Med.Fuel scenario. Accordingly,ACSI is proceeded aggressively with efforts aimed at confirming the feasibility and financibility of our Valdez Clean Coal Project while meeting the criteria of a Qualifying Facility (QF)under sections 201 and 210 of the Public Utilities Regulatory Policies Act (PURPA).ACSI has also approached the City of Valdez,several Valdez area fish processors,the U.S.Coast Guard,the Department of Transportation and others to confirm the need and willingness of large energy consumers to purchase the Project's waste energy through a hot water and/or steam district heating system on a long term contractual basis.In fact,the potential Valdez area district heating load is more than adequate to ensure that the Project will operate at an optimum overall plant efficiency rate approaching 60-65%net thermal efficiency, which is approximately twice the typical efficiency of other electrical generating plants in theState. ACSI has identify several distinct economic advantages that our Valdez Clean CoalProjecthasovertheotheridentifiedresourceoptions,as follows: Economic Advantages Associated with the Valdez Clean Coal Project offered by ACSI 1.Power generation capacity located at CVEA's major load center,thereby reducing losses and increasing reliability. 2.Reliance on an abundant clean Alaska energy resource,not subject to oil and/or gas price escalations,with excellent port facilities capable of economically receiving/handling coal in several bulk commodity forms. 3.Apparent least cost option for CVEA consumers. Executive Summary February 94.I-2 SECTIONIVALDEZCLEANCOALPROJECTEXECUTIVESUMMARY Economic Advantages Associated with the Valdez Clean Coal Project offered by ACSI Cont'd. 4.Offers significant energy savings as well as reduced environmental risk for large 10. 11. 12. 13. waste heat consumers.Waste heat sales are estimated to save large waste heat consumer approximately 5 million dollars over a 25 year period. Provides highest degree of reliability to CVEA consumers with close integrationwithexistingSolomonGuichHydroelectricProjectandCVEA''s Valdez DieselPlant.. Provides twelve long term plant operator jobs in Valdez. Reliable labor base to support the Project's long term operation and maintenance needs. Excellent City water and waste-water resources. Excellent potential opportunity for consuming the City's solid wastes,which could eliminate the need to permit/operate a new City land fill. Excellent potential opportunity for consuming the area's used oils and/or recovered pipeline vapors in an environmentally clean and acceptable manner. Excellent construction sites available with competent and stable sub-soil conditions that will substantially reduce the Project foundation costs. Moderate Winter climate that will eliminate plant cooling problems and associated operating costs. Unique opportunity to provide the entire energy needs of PetroStar or the Alyeska terminal,as an independent third party cogeneration facility,while simultaneously supplying the entire electrical power requirements of CVEA. Executive Summary February 94 I-3 SECTION I VALDEZ AL PR EXECUTIVE SUMMARY ACSI already owns and/or has a significant portion of the primary power generation components committed to this project and,subject to financing,is capable and prepared to construct and commission this project by January 1997.ACSI also has secured firm commitments from at least two Alaska coal producers to provide the Project's life cycle energy needs. ACSI has demanded that CVEA provide ACSI with its firm avoided power costs pursuant to Alaska Statute 3AAC 50.790(d).ACSI intends to pursue its legal right through the Alaska Public Utility Commission,as a Qualifying Facility (QF)under State and Federal regulations, to supply CVEA's need for new power generation capacity at or below its firm avoided cost. Essentially,the construction of our Valdez Clean Coal Project,as a QF,will eliminate any need for CVEA and/or the State to construct the Glennallen to Sutton Transmission Intertie. At a time when the State of Alaska is facing a budget crisis,it does not seem prudent to ask our legislators to subsidize a major capital project,such as the CVEA/MEA Transmission Intertie,to compete with a private sector project that is offering to provide a greater benefit/value at a lower true economic as well as environmental cost to the consumers of CVEA and the citizens of Alaska. Executive Summary February 94 14 p11 god §OS 12PM 2124686208"807 S22 2oseie.|weit)WITTTITA wan UEM ls An . poo',E e Zdo2-<. 1993 WL 403924 (N.Y¥.),62 USLW 2237(Publication paga references are not available for this document.)THIS DECISION IS UNCORRECTED AND SUBJECT TO REVISION BEFOREPUBLICATIONINTHE NEW YORK REPORTS. Joseph CRISCUOLA et al.,Appellants, No.172.Court of Appeals of New York. Oct.12,1993.we v.- 'POWER AUTHORITY of the State of New York et all,Respondents, wap ee Ta < .<BELLACOSA.;a eae a ,.Appellants are claimants whe seek direct 'and consequential "°°mirket value damagas for a high 'voltaga |po line easement., apquired by the Power Authority of the State of New York ("PASNY")over their Delaware County property.-'The only|issue before uscantersontheclaimforconsequentialdamages,-based on thaClaimants'assertion that "cancerphobia",:and «the public's . .©:reception of a health risk from exposure to|electromagnetic =%--.'-missions from power lines negatively impact wponithe market value |.of their property and "will render the remainder Waluelass".Theyarguethattheyshouldnothavetoprovethe"remsonableness"of_this perception as a separate,additional component of diminished -.-:.2 :of the Appellate | is necessary.<=|For purposes of *.-establishing consequential damages from "cancerphpbia,"claimants .:|hete successfully moved to have their claim tried tegether with 47. .other similar claims in a case with the lead titla jof Zappavigna v.State of New York.Tha Court of Claims in Zappavigna,as affirmed'the Appellate Division (186 A.D.2d 557),''held,inter alia,that D vision.=.... aimants had not met their burden "of "pre"cancerphobia"was reasonable,and therefora denidatiages.Nonetheless,claimante=appollants -hete'2raisingtheissueofwhetherreasonablaness of a perceived Wing that the . consequential "7°:@ not precluded .:° danger must be proven in an eminent domain 'preceeding.Thedeterminationofthereasonablenessaspectoftheevidentiaryissue -appavigna became an integral part of each claimant's case.It -@oks not bind and bar the present claimants-appellants because ofthelimitedpurposeofthejointtrialarrangementi/and because theclaimants-appellants hera had no indepandent right Lo appeal .andxdiscretereviewoftheevidentiaryissue.7)4.0°Thus,we conclude that the evidentiary issue is before uspuanttothisCourt's grant of leave to appeal,iWe must thusregolvewhetherproofofreasonablenessisrequiredbeforeaClaimantcanrecoverconsequentialdamagesforan}eminent domainingofproperty,whose value may be affected |by a perceivedlicfearofdangerorofhealthrisks.é.30nieefen -'We are satisfied that there should be no requirement that theimant,as a separate and higher component of its market valueproofs,must establish the reasonableness ofa fear or perception+tesnoTare tetee.. o teet - 2124606286 PAGE.204 SENT BY:NYPA LAW DEPT. ef danger or of health risks from exposure to hiTheissueinajustcompensationproceading is whether or +11 9993 5 312PM lines.net the market value has been adversely affectedGas&Electric Ca.v Daley,205 Cal App 3d 1334;Nichols on Eminent Domain,s 14.02[1][b}]at 24.31393]).This consequence may be present even if 3unraagonable.Whether the danger is a scienti£varifiable fact should be irrelevant to the cent 2124688208" (see,San Diegofeagenerally,4A0[3d ed Sacknan rhe public's fear cally genuine oralissueefits market vaiue impact.Genuineness and proportionat e dollar effects gh voltage power 7 907 522 2534i4 2 @ relevant factors,to be sure,but in the usual evidentiaryframework.Such factors should be left to the contest between the parties'market value experts,not magnified and escalated by a :whole naw battery of electromagnetic powar engineers,scientists or ..medical experts.:"Adverse health effects vel nonjis not the issue "°in:eminent domain proceedings:full compensation |te the landownerforpropertytakenis"(Florida Power &Light Co.|v.Jennings,518|'So.2d,°895,897).As the Court of Appeals of Kansas has noted:-Logic and fairness ***dictate that any loss |of market value _preven with a reasonable dagree of probability should becompensable,Yegardless of its source.If nojone will buy aresidentiallotbeacauseithasahighvoltage1acreasit,thelotisatotallosseventhoughtheownerhasthelegalrighttobuildahouseonit.'If buyers can be found,but enly at half the |valus iL had before the line was installed,e er has suffered |a (50%less (Willswy v.Kansas city Power,631 Pad 268,277-278).-Thus,ralying on Willsey,the Supreme Conrtof Kansae concluded,-arid we agree,that "evidence of fear in the|marketplace isadmissiblewithrespecttothevalueofproperty.taken without'proof of the reasonableness of the fear"(Ryan vi Kansas Power &eet Seer asPNRTae it |Diight Co.,815 P.2d 528,533).*:.Lo valle veeCera:.|Although this issue is a matter of first impression in this -ale -Court,it has been well ventilated in sibling jurisdictions whoseaprecedentsoffersomeusefulinstruction.The Court of Appeals of *:-Karisas simmarized the three prevailing views as of}1981 in Willsey =..":-v.|Kansas City Power (631 P.2d 268,supra ).T Willsey court ©...wee that the characterizations and labels tached to the .vi jeties of tast ara-inaccurate.Thus,the so-called "majority"--w,in which evidence of the effect on market.value of-afear of -. danger from power lines was unequivocally rejectad,was actuallyfollowedbyonlyfourstatesin1981(id.,at 273-274 [Ala,Fla,-: Ill,W.Va]).In contrast,the "minority"view)in which such *-?%is6::.aviidence is routinely aduitead on a simple showlng that the fearexistsandaffectsmarketvalue,was followed by eleven states and...os.the Sixth Circuit (id.,at 274 [Ak,Cal,In,Iowa,LA,NC,Ohio, - ,Okla,SD,Va,Wash]).-In these jurisdictions,the reasonableness-of|the fear ig either assumed or deemed irrelevant or collateral to |the market value issue and the considerations at customarily -..-.:pertain to its just resolution.Although it]preferred thesoecalled"minority rule,"the Willsey Court;held it wasunnecessarytodeterminewhethertoadeptthatrulesince,on thefactsofthatcase,the "intermediate”test,"most stringent'rule which can justifiably be applied,"was met (Willsey v.KansasCityPower,631 P.2d,supra,at 278).s no Sy Recently,Florida,California and Kansas reaffirmed that cerSTSEICR soe =aNOU3°93 12:12 3124666206 SENT BY!NYPA LAW DEPT._$tte 99933 3513PM i "212488820 reasonableness is nota factor in datarnining whet g er consequentialdamagesmaybeawardedforadiminutionoreliminationofmarket In:Florida Power &Light Co.v.Jennings (318 So.the Supreme Court of Florida held the "public's /fwhichmayberelevanttothaiasueofjustcomutilizedasabasisforanexpert's evaluation opof.whether this fear is ebjectively reasonable."&|'EBlectric co.v. California Court of Appeals added that "the ques]tHe fear of tha danger existed and would affect 3holdingthatreasonablensssisnota_factorconsidered.a te seen tyke Bebe ctrectiate|.Wa,of course, Ganages. value due to a fear of health risks from ais Soree,power lines....d 895,supra ), ear'as a factor bansation may be .In San Diego GasDaley(205 Cal App 3d 1334,supra ),'the :pion was whether narket value”in hecs Ss BT may use his or her personal fear as a basis for testifying aboutfearinthemarketplacs.'However,any other evidence that fear.exists in the public about the dangers of :high voltage isadmissible"(Ryanv.Kansas Power&Light Co.,°815 legitimate municipal concern against spurious claims and unjuatgroachnentsagainstthepublictreasury.Some ere adverse market value impact.'Claimants should ha"narket value diminution of the property to the'pa-.'the game manner 'that 'any other'adverse nazs,@.g.,by proffering evidence "that -thepropertyacrosswhichpower-lines {have -beennegativelyaffectedinrelationto'comparable| To add the extra component of reasonableness, or supportable or necessary.Thus;while a personal.perception is not proof enough,"the public's ydcertitudeerreasonablenessnotwithstanding.°:\2).: be which no power lines have been built (see generally,*Eninent Domain,5 12.02 (34 #d Sackman,1993]).7}.2: amet icular fear in ilt <has -beenopertiesacross as PASNY urges, yr the 'Accordingly,the order of the Appellata Division should berevarsed,with costs,and the casa remitted to theforfurtherproceedingsinaccordancewiththisOpinion.Order raversed,with costs,and case remitted Court of Claim te the Court Claims for further proceedings in accordance with the opinionherein..eee Us 2h A SST lo:re PRLKAYE,C.J.,and SIMONS,TITONE,"HANCOCK amd SMITH,JJ.,concur °i pace Me Bae _LEVINE,J.,took no part.- END OF DOCUMENT . "NOU 3 °S3 12:12 "9424686206 P.2d 528,supra,°at 533-334).©This standard protects,«as a 'countermeasure,'the | ibla,tangible |dence that a fear is prevalent must be presented to prove thetoconnectthe- at "éffectsare "+s Nichols on a market'srelativelymoreprevalentperceptionshouldsuffice,scientific - $07 522.253838 that need he ..segeeeewTTRAelSeet,BT eT ee eggs O inion regardless -LeaE ie cons ao not hold that claimants are relieved from ...--:.giying any proof to establish their claims and just compensation ""”*Rather,claimants must still establish some prevalantperceptionofadangeremanatingfromtheobjectionablecondition.*As the Ryan court noted,"no witness,whether expert or non-expert,- because the condition may not be sémething within ¢omnon knowledge ©)...experience,like an obliterated lovaly landscape views Fr notorqu@aror wt. wEGEi ved FEB 2 8 1994 TO DIVISION OF ENERGY/DCRA Herv Hensley State Department of Community and Regional Affairs Division of Energy Comment _on the Draft Feasibility Study for the Proposed Sutton to Glennallen Intertie BY Alaska Citizens for Responsible Energy Development February 25,1994 LINTRODUCTION I am writing this comment on R.W.Beck's draft feasibility study of the proposed Sutton-Glenallen intertie on behalf of members of Alaska Citizens for Responsible Energy Development (ACRED),a group composed of hundreds of citizens opposed to the Sutton-Glenallen intertie.This comment can not be exhaustive in ACRED's opposition the intertie.However,we have tried to outline ACRED's problems with the current draft feasibility study regarding the project's need,cost,impacts,and overall lack of justification. . Our analysis of the study leads us to conclude that the intertie is not the best solution for Copper Valley.Electrical Association (CVEA).It is apparent from the various growth scenarios presented in the study that tremendous and unlikely growth would have to occur in CVEA's service area, particularly at the Petro Star oil refinery in Valdez,in order to justify the intertie.Instead the most.likely growth scenario,based on population and industrial growth in CVEA's area and the likely life of the Trans-Alaska Oil Pipeline,dictates that CVEA's best solution is either an upgrade of diesel generators,or the Allison Lake hydro project near Valdez.Another fact evident from the study is that the intertie's cost,both in direct dollars necessary to build the project,and in indirect costs to affected communities,is quite underestimated. Finally,any argument CVEA makes now that the intertie is the best option because the legislature has already appropriated a $35 million interest free loan for it is flawed.The legislature violated the intent of the statute (AS 44.83.181-189)last year by appropriating money for the intertie before the feasibility study was complete.Any attempt now to use this.illegal action to justify the feasibility of the the intertie misses the point of a feasibility study requirement.That is,if the project is feasible,then it gets funded.The fact that the intertie is already funded cannot become a reason for making a project feasible. This comment will not get into a detailed analysis of CVEA's demand,the cost of the intertie,or an analysis of the alternatives.Instead,we have attached a separate and detailed independent assessment done by Mark Foster.P.E. on those issues.We hereby incorporate by reference that assessment into this document. Il PROCESS We would like to first discuss briefly process.After filing a formal request to see public documents associated with the study,ACRED members learned that CVEA had unrestricted access to the impartial consultant,R.W.Beck, while Beck was working on the recently released draft. This perceived unfairness has disturbed many of us.Many ACRED members have spent countless valuable hours educating themselves about the project,and involving themselves in the process.However,we had no opportunity to influence the assumptions in the draft study whatsoever.To find out that the "process"seems to allow a special relationship between CVEA and the "impartial" consultant frustrates many citizens who have been limited to this 30-day comment period to impact the study'results. It is also clear that the lack of public meetings in Anchorage,Palmer,and Wasilla has been a flaw in the process.Not only do people in these areas use the Matanuska Valley recreationally,many residents of these areas also own property along the intertie's route which will be directly impacted. Regardless of any past inconsistencies in the process, the Department still has to decide which of the several scenarios presented in the feasibility study is most probable.After all,the Department's decision must be based in part on its prognostications of the future,based on information in the public,record.We would like to comment briefly on the philosophy that we hope the Department will take with it when it enters its decision- making process.. PHILOSOPHY The Department's concerns for the needs of rural Alaska are important.However,we hope that when it considers the needs of rural communities in the Copper Basin that it gives equal consideration to the people of the rural Glenn Highway communities who are near unanimously opposed to the intertie.ACRED members want to make it clear that we are not against CVEA meeting their legitimate electric needs.However,we are against the intertie because we feel it it is an illegitimate solution to CVEA's needs.We are rural Alaskan communities,too. We do not want our quality of life sacrificed so that CVEA can build an intertie that can only be justified to supply the Petro Star oil refinery in Valdez. We advocate a win-win resolution of the conflict.We believe either an upgrade of CVEA's generators,or the Allison Lake hydro project,in combination with aggressive conservation measures in the CVEA service area,is such a resolution.If,in the future Petro Star does increase its power demand beyond CVEA's capacity,we believe the solution in that unlikely case would be for Petro Star to generate its own power.Such a resolution allows all the rural communities involved to maintain their integrity. lil SOCIAL COSTS We think it is significant that R.W.Beck places a zero dollar value on the intertie's social costs to the affected communities of Sutton,Chickaloon,and Glacier View.The study does not enter these costs into any of the cost/benefit scenarios that are presented.Putting a zero dollar value on these costs not only skews the results of the economic analysis,it ignores the outspoken and determined opposition to the powerline in these communities.In other words,by focusing entirely on the costs and benefits to the Copper Basin communities,and ignoring completely the costs to the "corridor''communities through which the intertie would pass,the study is fatally flawed. The following are some of the specific ways the intertie would cost the people from Sutton to Sheep Mountain.. 1.TOURISM Tourism is the fastest growing industry in the state. It is also the industry with the best chance of sustaining our rural economies over the long haul.Because of the Matanuska Valley's scenic beauty and close proximity to Anchorage,the communities of Sutton,Chickaloon and Glacier View have all increasingly relied on the tourism industry in recent years.The Matanuska Valley is already a popular destination for Anchorage residents who enjoy hiking,biking,skiing,and backpacking in the area.Locally owned tourism-based businesses in the area include hiking, hunting,and fishing guides;horseback outfitters;river rafters;and campgrounds.In addition,our communities' restaurants,gift shops,grocery stores,and gas stations all benefit from recreationists and travelers who simply drive the Glenn Highway from Palmer to Sheep Mountain to enjoy the incredible scenery.- The draft study does not examine any of the adverse impacts tourism-based businesses will suffer if the intertie is built. First,a vast percentage of tourism revenues for rafting,horseback riding,and guiding services come from "day trips".That is,trips that take tourists into the backcountry a short distance and then back out the same day.It is precisely this type of business that the intertie would affect the most.Nearly 100%of the tourism-based businesses described above operate on the north side of the Matanuska River,in the Talkeetna Mountains.This means that the one-day hiking,horseback riding,and raftingtrips all take place in and around the foothills of the Talkeetna Mountains,precisely where the intertie would be routed. Because of the narrow configuration of the Matanuska Valley,all of these day trips would have to pass either under or near the powerline.Furthermore,since the Talkeetna Mountains rise abruptly above the valley,any trips that take clients up above the intertie would present those clients with a long view of the powerline and its 125 foot right-of-way. The Matanuska Valley has potential for great growth in the visitor industry.However,local tourism-based businesses rightly fear that the intertie's presence will detract from our area's backcountry appeal.The intertie's ugly scar will discourage new tourism-based businesses from developing.The intertie's construction would also affect the growth of new service industry businesses such as lodges,bed and breakfasts,and restaurants that accompany increases in tourism.(See the attached Scenic Glenn Highway brochure to see one way local tourism-based businesses are marketing the area). The presence of the intertie could also decrease the number of visitors who do nothing more than take a one- day drive up the Glenn highway to sight-see from the car. All routes,including preferred route (D),would make the intertie visible from points along the highway,including the dramatic view up Granite Creek toward Granite Peak from the Glenn Highway bridge across the creek.(The study notes that this sighting could be avoided if the intertie were routed behind Knob Hill).And,because CVEA ultimately has the power to route the intertie wherever it wants,there are currently no assurances the intertie would not be built.right along the Glenn Highway.(This could be the cheapest option for CVEA who wants to keep the cost of the project as low as possible).Not only would such a route inspire litigation regarding condemnation,health hazards from Electro-Magnetic Fields,and property values,it would also ruin the scenic appeal of arguably the prettiest highway in Alaska. Furthermore,if the intertie is built,tourism . businesses whose revenues actually do decline may sue either the State of Alaska and/or CVEA for damages. Neither the cost of possible litigation,nor successful recoveries,has been factored into the study's analysis of the cost of the intertie. Having discussed the above potential impacts,local residents take great issue with the draft study's conclusion that: Negative economic impacts to tourism related businesses in the Matanuska Valley may occur but are likely to be minimal.(Vol II,page 3-10). All of the above mentioned costs should be assessed in the study's final draft. 2.ALITY OF LIFE Most of the people who live in the communities of Sutton,Chickaloon,and Glacier View do so at least in part because of the quality of life offered in these places. Residents enjoy some the most spectacular scenery in southcentral Alaska. The presence of the intertie will adversely affect the quality of life in the communities of Sutton,Chickaloon,and Glacier View.Indeed,the study admits that: _eethe transmission line is likely to have a Significant impact on the scenic and recreational 'resources along the project corridor.(Vol.II, Page 3-10). However,the study places no value whatsoever on these impacts in its cost-benefit analysis. The intertie would have negative impacts on the affected communities in the following areas: A.Economic Base As already noted,people who already rely on tourism-based businesses could well face a decline inrevenues.And,the area's hope to increase its reliance on tourism will receive a great setback. The need to evaluate the potential economic losses to the corridor communities is underscored by the fact that 'the study is actually so bold to suggest a.positive economic impact because of the "wages and earnings for various construction trades".(Vol.2,page 3-4).Obviously,any such impacts would be very temporary and would not begin to compare to the long term effect the intertie would have on tourism in the Valley. B.Health Affects The draft study has developed and examined four alternative routes where the intertie would pass.These routes all attempt to avoid placing the powerline within 600 feet of habitable structures.However,as noted above, the study is not the definitive authority on where_the powerline would be eventually routed.Instead,the ultimate decision on routing will be left up to CVEA.This point is very important because it affects virtually the entire discussion of the powerline's impact on the affected communities.Perhaps the most important of these potential impacts is adverse health affects which are associated with the Electro-Magnetic Fields (EMFs).If we in the affected communities have no assurances of the intertie's route,we are unable to make any intelligent comments on these health affects.However,be assured that if the route would eventually pass near homes,a whole separate fight will ensue. Even if the intertie was to be routed away from homes,it would still have negative health impacts.The intertie will have a 12 foot wide grubbed trail underneath it,which will remain after construction so that maintenance crews can access the line.It is safe to say that no matter how many warning signs are erected,children and some adults would still use the intertie's right-of-way as .a trail. This means that hikers,horseback riders,snowmobile riders,and four wheel drivers will all be exposed to heavy doses of EMFs while passing directly underneath the powerline. Another negative health impact which would be imposed by the intertie's construction is the unknown impact EMFs would have on wildlife.Some residents are particularly concerned about impacts on moose.It is quite conceivable that moose would also use the 12 foot trail underneath the powerline,especially when deep winter snows force moose into the lower regions of the Matanuska Valley.People who subsist on moose are concerned that the moose could develop health problems that would translate into either less moose,or possible health risks for those who eat moose shot in the area of the intertie. Although the draft study mentions some of the intertie's impacts on the Matanuska Valley Moose Range,this particular impact is not analyzed. All of these health impacts should be assessed and valued in the study's final draft. C.Visual Impacts It is ironic that the study is concerned about whether travelers on the Glenn Highway will see the powerline while it virtually ignores the fact that many residents are being asked to deal with the violation of their beautiful area on a daily basis.People who would be able to see the powerline from their homes will constantly be offended. For some,this violation may be so strong that they will choose to move out of the area. Again,the study should assess the real impacts to the people who will see the powerline on a daily basis. D.Recreation People who ski,snowmachine,hike,or bike on local trails will also have their experiences marred by the presence of the powerline.The intertie would be visible from parts of the following locally used trails:the historic Chickaloon-Knik-Nelchina trail as it runs along King River toward Castle Mountain,Hicks Creek Trail,Caribou Creek Trail,Squaw Creek Trail,Alfred Creek Trail,and the Crooked Creek Trail.If the intertie were routed up Boulder Creek,it would follow the trail used by many hunters and backpackers to reach the Chitina Pass area.(See 55 Ways to the Wilderness in __Southcentral_Alaska,p.145 for a description of this area which would be greatly impacted). Regarding recreation users in these.areas,the draft study notes that: Transmission line structures would introduce structural (i.e.,industrial appearing)elements into the largely undisturbed landscape of the project area degrading scenic values.The presence of transmission line structures and access roads in any of the largely barren drainages in the Talkeetna Mountains would cause high visual contrasts.Because these landscapes have little or no forest cover,there is .Minimal potential for screening the transmission line structures from view.(emphasis added)- (Vol.II page 3-9). The study goes on to say that: Potential impacts to views from recreation trails in the Talkeetna Mountains could be significant. (Vol II,Page 3-10). Aerial recreation in the area will also be affected by the intertie.Currently,hang gliders use a low hill just to the east of Knob Hill in the Sutton area to take off.The presence of the powerline on that hill (See preferred alternative route D)will adversely affect,if not foreclose, this activity.(The study notes that this conflict could be avoided if the intertie were routed behind Knob Hill). Many small planes also use this area and those users would also be impacted by the long span crossings the - intertie would impose. Finally,the study admits that the intertie could be visible from several State recreation sites.These sites include:King Mountain Receation Area,Bonnie Lake Recreation Area,Long Lake Recreation Area,Caribou Creek Recreation Mining Area,and the Matanuska Glacier Recreation Area.(Vol.II,pages 3-7 and 3-8). All of the above impacts on local recreation (and tourism)should be given a value in the final draft of the study. E.Subsistence Hunting Residents have expressed concern all along that the intertie's access roads would increase the already intense hunting pressure in the Talkeentna Mountains along the powerline's route.The more access roads into these mountains,the more hunters from the Anchorage metro area who will be able to compete with locals who depend on local wildlife to feed their families.The draft study does nothing to alleviate the concerns of local hunters.The study does not confirm where access to the intertie would be gained.Nor does the study confirm or deny that new access roads would be built.Instead,the study concludes that: Increased road access could increase hunter numbers to the point where moose populations are adversely impacted.(Vol.II,page 3-6). The result of the study's incomplete analysis is that the public is effectively denied the ability to intelligently comment on the impacts any new access roads would have on hunting pressure in the area. 10 F._Cultural Resources While the study mentions the cost of a cultural resources survey,it does not mention any cost of mitigating or eliminating potential impact to the cultural resources the survey might identify. There are known cultural resources along the entire base of Anthracite ridge that would be impacted if the intertie were routed there.Costs of mitigating impacts to those:resources are left out of the project's budget. G.Disruption of Normal Lifestyles The intertie has already disrupted the lives of many local residents.Many people have donated time,energy, and money toward the effort to stop this powerline.It has been an invasion of sorts,even without the erection of one steel tower.While other interests perceive benefit from the project (CVEA wants the State's money,R.W.Beck is making money in consulting fees,the State sees "development")people in the affected Glenn Highway . communities have absolutely nothing to gain,and much to lose,if the intertie is built.As long as the intertie issue is alive,residents opposed to the powerline will continue to devote efforts toward stopping it.Hence,attention is being drawn away from our normal lives today because we fear the intertie could drastically change our future. G.Property Values Many residents own property with spectacular views of the Talkeetna Mountains to the north.If the intertie is built,not only will the aesthetic sense of these properties be violated,but those property owners will also face difficulties in re-selling their property in the future.In other parts of the United States,plaintiff property owners have successfully recovered from parties responsible for diminishing their property values do to the presence of powerlines.See,for example,Willsey _v.Kansas City Power &Light Co.,.631 P2d 268 (Kan.App.1981).Both the State of Alaska and CVEA can expect such lawsuits if the intertie 11 project proceeds.However,the feasibility study examines neither the cost of such litigation nor successful recoveries. See attached article EMF Radiation Revisited,Appraisal Views,Volume 6,Number 1 (1993). Furthermore,a property's value to a homeowner can not really be fully assessed.A person's sense of place,the work they have put into a piece of property,and the expectations they have of sharing that place in the future are all intangible things that will be impacted if the intertie is built through the Matanuska Valley. IV_ENVIRONMENTAL COSTS As with the social'costs outlined above,the draft study places a $zero dollar value on the environmental costs the intertie would impose if it were built.Some of those costs include: 1.VISUAL IMPACTS These impacts have already been addressed above. Some value should be assigned to these impacts. 2.WATER QUALITY The study notes that the "surface water quality in streams,lakes,and rivers in the project area can be considered very good."(Vol.II,page 2-9).Area residents would like to keep it that way. .The draft study admits that one of the impacts which may be anticipated during construction of the intertie is "erosion and sedimentation of streams."(Vol.II,page 3-1). However the study goes no further in discussing this sedimentation's effect on anadromous fish streams or compliance with the Federal Clean Water act..The study's non-existent treatment of these issues is flawed.| Another potential impact on local water quality is erosion caused by new access roads.(This has been a major environmental problem in many forest areas where roads 12 are built to access timber).Nowhere in the draft study are these potential impacts discussed because,the draft study does not confirm where the access roads would be.Thestudymerelynotesthat: The effect of any such increased access would be further assessed should the project proceed to an EA or EIS,if required.(Volume II,page 3-14). Again,this treatment is unacceptable.It is impossible for concerned citizens to intelligently comment on _this important issue. 3.WILDLIFE A value should be placed on all the following potential impacts in the final draft of the study. A.Moose Possible increased hunting pressure on moose in the project area due to more access roads has been addressed in the "Subsistence Hunting"section above. B._Caribou The Nelchina caribou herd resides in the project area, including on a portion of BLM land.The study admits that new access roads that could be associated with the intertie "could increase hunter numbers to the point where area caribou populations are adversely affected."(Vol II.,page 3-6).Since the study is silent on the presence and extent of access roads necessary for the project,the public is unable to make intelligent comments on impacts to the Nelchina herd at this time.However,the final draft should include an examination of what impact a protracted EISprocesswillhaveontheproject.Such an EIS is likely to be required before the BLM issues a right-of-permit. C.Dall Shee Again,the issue of access roads and hunting pressure is not adequately addressed in the study.Instead,the: 13 study merely admits that the "greatest populations of Dall sheep in the Talkeetna Mountains [live]...within the project study area,"that "hunting pressure on rams in this area is already fairly heavy,"'and that "[i]ncreased road access could increase hunter numbers to the point where area ram populations are adversely affected."(Vol.Hl,page 3-6). Additionally,the study admits that the proposed route of the intertie "passes directly over a mineral lick where it crosses Granite Creek beneath Knob Hill.[And]the northern route:alignment passes within 1/4 mile of another mineral lick approximately 1/2 mile west of Young's Creek."(Vol. II,page 2-18).The study acknowledges these mineral licks are an important feature of Dall sheep habitat,providing nutrition and social interaction.Routing the intertie directly over the mineral lick near Granite Creek is clearly inappropriate,yet the study suggests no measure to mitigate this impact. Without knowledge of the placement of access roads the public can not assess the full impact the intertie would have on Dall sheep. D.Raptors The study.states that Although no eagle nests have been documented along the route,there is potential for these nests in the area. Local residents are aware of at least one Bald eagle nest along the proposed route up Boulder Creek that has not been identified in the study . The study fails to put a cost on compliance with the Bald Eagle Protection Act. E._Fish The study notes that at least fourteen anadromous fish streams would be crossed or directly downstream of potential route alignments.(Vol.II,page 2-12).However, 14 nowhere does the study discuss the intertie's potential impacts on these streams. In fact,there could be significant impact to these streams.First,none of these streams has large populations of anadromous fish.Therefore,even slight impacts on water quality could be detrimental to the stock.Second,as noted above in the "Water Quality"section,the study admits that the intertie's construction would result in sedimentation of streams.Furthermore,any construction or improvement of access roads would lead to even more erosion that could affect water quality. Water quality,in turn,is the single most important factor in maintaining healthy fish populations in area streams.It is especially important to avoid sedimentation in very small spawning streams,like Little Granite Creek where chinook salmon spawn in a wetland just south of where the intertie would pass.(Vol.II,page 2-13). The study is very deficient in its treatment of this area of concern.A more detailed analysis needs to be done regarding the proposed intertie's impacts on fish streams.© F.Trumpeter Swans The study notes the trumpeter swan is a "Species of concern."(Vol.II,page 2-16).It also notes that "swans are particularly vulnerable to collisions with powerlines and this is a major cause of death in this species."(Vol.II, 'page 2-16).The study goes on to say that guidelines.tominimizeimpactsontheswanswillbeused,including "special attention to the siting of the line as well as to the marking required where transmission lines cross rivers and other open areas."(Vol.II.page 3-5). _Where are the costs associated with implementing these guidelines identified?Are the costs associated with waiting for a full-blown EIS to be completed factored in the total cost of the project.It is likely that the presence of the swans will trigger such an EIS before the BLM can issue a right-of-way permit. 15 G.Brown Bears Local residents know of at least one dense Brown bear habitat that would be directly impacted by the intertie's proposed route.Residents have reported many brown bear sightings on the Little Granite Creek bench,just east of Granite Creek.Bears have been seen in the wetland just below the knoll where the intertie is presently routed, opposite Knob Hill in the Sutton area. 4.NOISE POLLUTION The study admits that construction of the intertie would result in "increased noise...in nearby areas."(Vol.II, page 3-1) This noise would come from helicopters and other machinery. The study does not account for the costs of nuisance lawsuits that may be filed by locals impacted by this increased noise. 5.WETLANDS The study admits that "ground truthing will be required during the permitting process"to "determine the exact extent of the wetlands impacted."(Vol.II,page 2-3).. The study goes on to say that: The clearing of trees and tall shrubs in the right- of-way will result in the loss of some wetland habitat but it should not significantly affect the functional value of these wetlands.Impacts to wetlands and erosion and sedimentation could be minimized through the use of best management practices (BMPs)during construction,use of helicopters rather than building access roads,and timing construction during winter months when the ground is frozen.(Vol.II.page 3-1). The language used above is not comforting."Should" and "could"are not the same as "will"and "shall."In fact, 16 the above language contrasts with the report at Vol.I, page III-10 which states that: measures will be taken to limit disruption of wetland habitat and _to restore damaged wetlands in accordance with guidelines and permit stipulations of the permitting agencies. Well,which measures does the study mean to say will be taken?At what costs?Where are those costs accounted for?What restoration measures will be taken?At what cost?Are the costs of added helicopter time (to avoid impacts on wetlands)already included in the intertie cost? Where are those costs accounted for? The above discussion in the study does not give any true estimation of the costs that would be associated with the construction of the intertie through wetlands-either environmental or economic. 6.AREA LAND_USE_PLANS The study notes some of the land use goals for the local land use management plans in the project area.Those plans include the Matanuska Valley Moose Range Management Plan,the Nelchina Public Use Area Plan,the Copper River Basin Area Plan,the Chickaloon Special Land Use District Plan,and the Susitna Area Plan. The intertie runs counter to many of the goals of these plans,including: 1)The intertie would cause the loss of fish and wildlife habitat.The Susitna Area Plan requires restoration and rehabilitation of impacted habitats.The study places no cost on this required restoration and rehabilitation. 2)The Susitna Area Plan also stipulates measures to be taken to preclude direct impacts on mineral licks,or compensation for their destruction.(See also Matanuska Valley Moose Range Management Plan,page 84).The study includes no cost for compensating for the loss of the mineral lick opposite Knob Hill noted above in the "Dall 17 sheep"section.Nor does the study mention compensation for other potential impacts to mineral licks along the route. 3)The Matanuska Valley Moose Range Management Plan calls for the protection of scenic views of Granite Peak and Castle Mountain from the Glenn Highway.The intertie (as presently routed)would ruin the scenic views of Granite Peak from: a)the Glenn Highway bridge over Granite Creek; b)the Glenn Highway and Jonesville Road in Sutton and; c)the Glenn Highway just east of King River,traveling west. 4)The Matanuska Valley Moose Range Management Plan states that: All wetlands shall_be preserved in the Moose Range according to existing state and federal laws and the Susitna Area Plan. The Plan also calls for buffer zones around wetlands, including measures to reduce impacts on wetlands from development on adjacent side slopes.The 160 acre.wetland on Little Granite Creek Bench is a Class I wetland. (Matanuska Valley Moose Range Management Plan,page 101,183).The proposed route would parallel this wetland. However,the Plan states that: "Utility systems should not be located so that they parallel wetlands."(emphasis added) (Matanuska Valley Moose Range Management Plan,page 102). Finally,the Talkeetna Mountain Special Use District noted in the Matanuska Valley Moose Range Management Plan is totally ignored by the study.One of the primary purposes of this Special Use District is to: --conserve the unspoiled beauty of the mountains and _the alpine _region...(emphasis added) 18 (Matanuska Valley Moose Range Management Plan,page 4). The Moose Range Plan also notes the area has "some of the finest [scenery]the state has to offer."(Matanuska . Valley Moose Range Management Plan,page 38).The Plan's goal of preserving alpine scenery would obviously be tremendously violated by the construction of the intertie. IV_PETRO STAR LOAD FORECAST ACRED states much of its comment on the Petro Star load forecast in Mark Foster's attached assessment. However,ACRED would like to add that the Department would be jeopardizing any rate stabilization for CVEA customers if it approves the intertie with no assurances or "take or pay contract"from Petro Star.If Petro Star begins to generate their own power,or,goes out of business,CVEA consumers will still have to pay for the intertie without the revenues from the sale of electricity to Petro Star.© ACRED believes it is likely that Petro Star will not be in business long given the projected life of the oil pipeline, the business history of Petro Star and its owners,and the growing environmental problems Petro Star is having with the EPA and the State. It would also be outrageous for the State to spend money on the intertie to create was is,in effect,a subsidy of a private business.Finally,the image of "piping" electricity from the Beluga natural gas fields to Valdez where there is already more fossil fuel than anywhere in North America so a refinery can have electricity is ludicrous.(R.W.Beck and the State have already admitted -that the intertie,as presently designed,could not form part of a state-wide power grid creating another link between -Fairbanks and Anchorage). 19 V_INTERTIE COST It should be clear from Mark Foster's assessment of the study that the intertie's cost has been underestimated. Estimated construction and maintenance costs are very low, including the cost of helicopter time.Indeed,helicopter time is likely to be much more costly given the implication in the study that new access roads for construction and maintenance of the intertie will be kept to a minimum. There is a cost either way.Either access roads will impose the environmental costs discussed above,or,more costly helicopter time would be _necessary. Costs of right-of-way acquisition have also been grossly underestimated.In particular,the cost of obtaining right-of-way over Chickaloon Moose Creek Village lands has been completely left out of the project's cost.The Chickaloon Natives have been adamant in their opposition to the intertie and have stated that they will not sell an easement at any cost.Neither does the State have the power of eminent domain over the Chickaloon Natives. Finally,the costs of lengthy court battles over the many intertie issues have not been factored into the project cost. VI_ALTERNATIVES Again,ACRED concurs with the conclusions of Mark Foster regarding alternatives to the intertie.We would like to emphasize that it should be clear from Foster's comments that the diesel scenario was handicapped the way it was presented in the study.Replacing aging generators immediately,and adjusting for the true cost of diesel fuel bring the cost of the diesel scenario down significantly. In regard to Allison Lake,just a couple of comments are in order to address CVEA's argument that Allison Lake power will cost CVEA at the same rate as Solomon Gulch. This argument is not supported.No judge would would force CVEA to pay the 6.4 cent fee to the State for the added power generated as a result of the construction of Allison Lake.Allison Lake was never contemplated in the 20 original agreement.Nor is there evidence that the State would try to force CVEA to pay the fee.Indeed,what possible motive would the state have to do such a thing if it is trying to help CVEA solve their energy needs?Finally, for the sake of argument,if CVEA was forced to pay the 6.4 cents,those fees would be a transfer cost that would be passed on by CVEA.This is consistent with looking at the flow of costs of the project from _the perspective of the entire State of Alaska. Finally,the draft study does not include conservation measures as part of every alternative scenario.There is absolutely no reason not to include conservation measures in each scenario. VIl_CONCLUSION For all the above reasons,ACRED expects the final draft of the feasibility study to reflect the true direct andindirectcostsoftheproposedintertie. However,even if this is not done,CVEA's lack of need makes the intertie an unfeasible project.The Department should disapprove the intertie's feasibility.Thank you for your consideration.Lk Chris Rose ACRED Co-Chair General Delivery Sutton,Alaska 99674 21 65784793 B3:33 -Appraisal Views Quarterly Newsletter of Arthur Gimmy InternationallVNI |st Quarter,[993 &415 362 4313 ARTHUR GINMY INT 82 Volume @2 Number,Ll EMF Radiation Revisited 'Three years ago we warned the real estate industry of a varicty of reaf estatevalueproblemsandpotentiallegalliability where Electro-Mapnetic Fields (MIF) were present,At that time,a deluge of Newspaper and magazine articles hud ¢x- plored and publicized spproximately fif- teen years of scientific work which itnplied #relationship between electric currents and various types of cancer,particularly those alTecting children. While the electric utititics and their | rescarch cniilics vocally insist that nothinghasbeenproven,a large numberofarticles,stories,and studies imply the opposite. Also.the scope of concern has cxpanded from high voltage power lines and trans- formers tu include electric railways,resi- dential service-drups,ciectrical wiring. aml common household appliances.Of greal significance,the most comprehen- the most comprehensive study , undertaken anywhere world- wide...has recently concluded that . there is a clear and definite reta- tionship between electric currents ; and certain cancers, sive study undertaken anywhere wurld- wide (by the Government of Sweden)cov- tring 500.000 people who fived within 1.000 fect of high voltage lines over a 15 year period,has recendy concluded that Uere is a clear and definite relativaship cers. The Swedish Government conclu- sions were highly publicized throughout the United Suites in recent months.'The standard of danger for continuous expo sure adopted in Sweden is reportedly milligauss for children and 2.5 milligauss ; for adults,The gauss (and milligiwiss)is a measuring unit of magnetic field strength typically utilized in relation to EME,al- though other forms of radiation not meas- nrable in this way may also be connected with EMF. Government Regulation In the .S..standards are still evoly- -ing and are being pursued on federal,state, an local government levels.The critival | factors scem ta be proximity and length of exposure,Therefore,residences and places of work (where peuple spend sub- stinttial time)are offen the subject of regu: lation.'Three basic approaches are taken in fonnuliing regulations: @ ='Thedirect approach istoestablish meusurable maximum allowahlc levels of radiation. ©The indirect approach is to pro hibit certain uses within certain distances of radiation saurges. e =Acollateral approach is requirefulldisclosureofthecancerrisk to potential buycrs ina sale of real entite, Federal Atthe federal level,the Deparunent of finery and Environmental Prowction Agency ure sponsoring conferences:aud studying the problem.They have circu- tied a canber of draft reports and:pro- ,Poser slundands.between electric cusrents and cenain can;State On the state level,public utility com. missions and other agencies are studying the problem and collecting intormation and opinions,1 is reported that some states have started to lepisiate pertinent least two states (Michigan and Tennessee) bills were recently debated to ban the con *struction of high valtage lines (aver 60 Kifovolts}until scientific studies are com- pleted.Oue Tennessee bill sought to ban high voltage fines within one hall mile of any occupied dwelling. Local Local (city and county)ordinances and practices are having an increasing im- PACL ON Owners,Investors,developers,and brokers of real estate.In one county.a specifie condition of a subdivision ap- proval is that a prescribed statement of disclosure of the possible "adverse health effects”related 10 high voltage electric :transmission fines be recorded i the title regukdions and safety standards,Iu at. records of every lot within 300 feet of a high voltige line casement.Jn many coun.ties,a high voltage line on or neara devel- opment property almost assures the need for an expensive environmental impact study should the question be raised In the process of sccking necessary permits. Special open space requircruents are sume- Gaines designed by or imposed on develop. ers ty provide a safety setback, Califomia recently prohibited the con- struction of schools within certain dis- Continued an Page 3 ES |).\|: 'Trends |2 Appraisal News 2 EMF Continued 3 Viewpoint _4 EMF Continued 4 85784793 83:34 tances of high voltage transmissinn line |casements ax shown in Table 1. Marketplace Responses Banks &Lenders Banks and other lenders are,report- edly,increasingly concemed buth about potential future liability and the value of the real estate security.Slowly they are responding as they did in the case of toxic waste problems by ©hiring necessary experts @ =requiring burrower-upplicants to doa full workup of such problems and the value-reliability of the se- curity ©«refusing to become involved since there is a grcat deal of am- diguity involved in the subject. Cases have been reported to us where loans were denied becauseof the proximityofhigh-voltage transmission lines. Developers &Builders Residential subdivision tind develop- ers report that builders who purchase up proved lots in butk will not even look at property that is crossed by a high voltage line.Residential builders working trom sales of models report that the last foca- tions sold are those nearest the high-volt- age lines and prices typically arc discounted to complete the project,tn ad- dition ta direct discounts,it would be ap- propriate to discount for the additional marketing time (amd carrying cost)of lund acar the high-vultage lincs when apprais- ing the effect of a new power installation on undeveloped land.In the pricing of homes built for sale,developers will typi- cally make adjustments up and dawn for factors such as view,access and visibility, ft size,and ullier factors.Our research a School Proximity to High Voltage Line Easements Voltaye Distunce 100-110 Kv 100 Feet 220-230 Kv 150 Feet Over 345 Kv 250 Feet BS 415 362 4313 ARTHUR GIMMY INT es Continued From Loot 11,ao Chiles Ke Baulch EMF Radiation Revisited shows tat proxiniity of high vultage trams-|nearby and nu infornution will be pro-mission lines usually triggers a nurkdown vided 10 owners to fet them kaow that their of about 10%and,int rovent years,this has been insufficient,We note thal around a 15%discount in the final package (house and lot)typically converts tu about a SU%- discount in the land value. Buyers Interviews with home buyers have convinced us that there is a high and prow- ing degree of awareness about the EMI ixssuc.With mae exceptions,there is a * strony negative preference about purchas-| ing a residence near a high-voltage trans- mission dine.Price discounts may persuade same peopk:to buy but there uppeurs to be a growing sepment of the public who would not buy aresidence scar high-voltage lines under any circun- stances. Investors Investors in residential and commer- cial property face the same factors de- scribed ubave.They must also worry about resale at a planned future time *aguinst a tend towand shrinking demand for properties located near high-voltage limes.Ty addition.there is the increased cost of development,growing uncertainty of refinancing,and risk of future liability ats hews chase. Financial Effects While the electric alilities und their research affiliates struggle to show that electric currents do nut cause cancer,the public has apparently decided not to take the risk of to wait and see what the scicn tists finally prove.'Mus,the vatue of rcul estate near high-voltage power lines:is Mrongly affected whether or not an analyst considers final users,investors.or both together,The trend is accelerated by the basic characteristics af the tending and de- velopment industries as they seck to mini mize or avoid risk. According to the North American Electric Reliabitity Council,utilities plantoadd12,600 miles of new transmission line in the decade of the 1990s.In all probability they wilt acquire a new right-of-way lypically of 75 10 100 feet in width per line.tn mast cases,no offer will be made to pay fur dhe fost value of land reusuiteisg land value is diminished.Nev- ertheless,EMF effects of ane milligauss (the Swedish inaximum radiation level for children)can reach approximately 400 me- ters (1.200 fect)from the line at 500 kilo- volts.Only those owners who study this Only thuse owners who study this subject,prepare themselves, and negotiate effectively will avoid a loss of renal estate value without compensation. subject,prepare themselves,and negotiate effectively will avaid a loss of real estate value without compensation, The second probable financial effect__of EMF is an inctease in ton liahitity when the courts recognize EMF as the "proxi- mate Cause”of a specific cancer in a spe- ¢ilie setting.While we have heard reports of eflorts to sue powercompanies for dam- apes for causing specific cuncers.we have met heard of successful case-opinioas,pre- suntbly because the chain of causation is difficult to prove.This may change as the scientific evidence comes in.It cannat be predicted what secondary liability may re- sult ta property owners.developers,or lenders uf residences or places of wark in EMF danger zones,The uncertainty is al- ready affecting values. 'The extensive Swedish studies add greatly to te clarity and definition of the EMF problem.While thesc results support the public fours and assist in explaining the Josses in value tu certain real estate,they abo show a direct relationship between degree of expusure to EMF and incidence of citncer.The relationship is almost a prouf of "proximate cause”sufficient to tnaintain a tort action.Only time and judi- cial decisions will tell us whether addi- tional scientific evidence is needed of whether the burden now shifts to the ulili- ties to show otherwise. Quandaries and Predictions The scientific work (especially the Swedish studics)as well as the public per-ception of danger seem to have brought the Continued on Page 4 ios Frome 85784733 83:35 In today's market the buyer must have cash.The days of "mortgaging out"were possible anly when valucs exceeded cost. With values on the decline,no-cash buyers have evaporated from the market. The buyer of property today is a per- son or enterprise who has made and saved their cash.These are the people whe heeded the warnings of the mid 198Us and knew that "even in Boston.lights turn to caution.”'They may have participated in the market in the 1980s,hut did not become over leveraged and stopped when wanting, sighs appeared. Today's buyers include proups formed te acquire properly priced assets. 'These buyers,however,are finding.(hat owner with prime properties are holding, riding out the market downtum,and not giving way (v the enticement for cash now. Whit was missed in the (980"s is that, in truth.the numberofbuyers fora property was very small.Any one property might continued From Pave 3 lated real estate situation to the verge of intense conflict and possibly litigation. Whik:itis clear how a situationshould be handled where new power lines are to be built,there are many properties which have been affected (both recently and long ago)where promises or asscrlions were made regarding the safety of electric lines and their lack of ciTect on the value of udjuining land.In recent years there has scaningly been a studied effort to focus on the causative proof between clectric tines Arthur Gimmy International 341 Broadway San Francisco,CA 94133 View PO aes Bs Webster AT Collins Today's Buyers have,at most,ten potential buyers.If dare was ainarkel fora property.most certainly, thase buyers could readily be identificd. Kor example,in the 1990's the ouly buyers of any note in the Boston market are "hon evtailers.”There wene a certain logi- cal number of sites for these box retailers but most have now made wir moves.To perpetuate past (rends and say that retail values for certain sites will continue,fails to recagnive that there is a limit us the number of buyers for a property, Buyers move in and out of markets. Box retailers who came to Boston made their move suddenly,sharply,and quickly. Their objective has been te capture 104%ol the urca's $40 billion in cetail sites.Like soinany other buyers for real estate,their moves,once having been made.will now be limited in the future. The buyers of property base their de- cision on the sense of the deal.They know that if the owner docs not bave to sell,price ees fy hares Ro Baumbach and cancer and rely on that position to avonl notice or payment relative lo tort claims of lost value of nearby property. Having watched this situation evolve during the last five yours,it is predictuble that there will be a strong increase in re- lated titigation and probubly in class ac tions. The authen,Charles R.Batuuhach,is a licensed attorney and a Senior Appraisal Asseviate with Arthie Ginimy literna- fianal,The firm has been involved in U1 S 415 362 4313 ARTHUR GIMMY INT e4¢ becomes totally different than with sn owner that does have to sell. This is where institution,with few exceptions,have failed.Buyers believe that institutions,in many cases,"have to sell.”When this occurs,prices can plum- met. "The institution may nut even own the property,but may put pressure on the ac- tual owners to sell as purt ofa workout Thus,the art af negotiation is a critical clement.([f the FDIC and certain wajor hanks were to pull back from the market, announce thei pull buck.live by il,and then very quictly creep back in on Jide cat's feet,io my judgment,(he pricing structure of real estue within this cownry would be on a totally different perspective. The author,Webster A.Callin MAL, CRE,is Exeentive Vice PresidentiParmer of Whittier Partners in Moston, power line cases aver the last wo years concerning EMT, :Arthur Gimmy International _341 Broadway San Francisco,CA 94133 ”(418)781-6262 James A.King,Editor Copyright,1993 Reprint by Permission Only Forwarding and Return Postage Guaranteed and Address Correction Requested Bulk Rute US.Postage PAID San Francisco,CA . Pennit No.253 Matanuska Glacier Photo by Darel Wentworth In One Day! MP 113.5 Sheep Mountain Lodge MP 102.5 Glacier Pass Overlook Park & Recreation Area MP 102.2 Long Rifle Lodge MP 102 Glacier Park Resort MP 76 Nova Riverunners MP 76 King Mt.Lodge MP 69.7 Pinnacle Mountain Recreation Center _.". MP 62.5 River's Edge Recreation Park MP 61.6 Alpine Historical Park MP 61.5 Granite Peak Gitts &Souvenirs MP 61 Sutton General Store &Jonesville Cafe MP 61 Alpine inn Greater Sutton Chamber of Commerce es } "if « sor ,\ye 145-4527 |a ee | Photo by Linda Ketchum S/Y CERAMICS.Stock's Yard makes an extensive line of handcrafted ceramics.Made right here in the Upper Matanuska Valley.Look for the S/Y tag at Valley gift and souvenir shops. MP 61 ALPINE INN.Full service bar and package liquor store.Open 9 a.m.,seven days a week.Phone, coffee &acres of parking.Motorsports events are held year round. MP 61 SUTTON GENERAL STORE &JONESVILLE :-CAFE.Open seven days a week.Lunch and dinnerPhotobyRu.Hayes specials.Friendly family atmosphere.Pick up last minute needs.Everything from ice cream to hardware.Meais to go if you are on the run.Pop,candy,cigarettes and souvenirs.Alaska made crafts and jewelry. Bargain table.(907)746-7461. MP 61.5 GRANITE PEAK SOUVENIRS &GIFTS.Beautiful view of Matanuska River.Free coffee -clean restroom -circular driveway.Quality at a decent price! Specializing in Alaskan-made;but,check out our Russian folk nesting dolls,"Knot Knoggins”&''Leanin'Tree''.Fishing licenses,jewelry,ulu knives,S/Y ceramics. 'tee-shirts,pop &candy,postcards,etc. MP 61.6 ALPINE HISTORICAL PARK.14 miles N.E. of Palmer on the Glenn Hwy.Highlights coal boom era, Native history,and AlCan highway history.Traditional craft displays,picnic/playground facilities,museum shop and restrooms.Open 7 days/week,10 a.m.to 7 p.m.May 30 -Sept.7.Phone (907)745-7000. MP 62.4 RIVER'S EDGE RECREATION PARK. Secluded campsites for RV's and tents,fresh well water,electrical hookups and restrooms.Spawning salmon,baid eagles,wildflowers and plenty of firewood.Phone (907)746-CAMP (2267)or 745-4527.Photo by Lynne WoodsMP69.7 PINNACLE MOUNTAIN RECREATION CENTER.42 RV spots,showers,laundromat,groceries,gifts and souvenirs.Cen- tral location to schedule river trips &flightseeing.Horseback and hiking trails. Salmon bake and sourdough pancake breakfast.Free visitor information.Free coffee.Family fun.Present this flyer for 3*/gallon discount and other discounts. MP 76 KING MT.LODGE is located on the Matanuska River and is one of the oldest lodges on the Glenn Hwy.A great area for anyone that enjoys camping, hiking,fishing and photography.Featuring a great menu of home cooking and the original 'King Mt.Burger!”Bar-cafe-lodging-electrical hookups and free RV parking.(907)745-4280. re ;MP 76 NOVA RIVERUNNERS.Alaska's Guides to Alaska's Rivers since 1975.Class I to V.Day trips near Anchorage.2 to 7 day trips statewide,kayak trips with raft support.Thrill to the whitewater of 'Lionshead” Trip or just relax on the ""Matanuska”Trip.Box 1129, Chickatoon,AK 99674.Phone (907)745-5753. MP 102 GLACIER PARK RESORT.540 acre private resort at the terminus of the Matanuska Glacier in the heart of the Chugach mountains.Offering Glacier tours,flightseeing,recreation camping,gift shop, rooms,liquor store,film,snack foods,snowmachin- ing,cross country skiing.Motorcoaches and tours welcome.Open ail year.(907)745-2534. MP 102.2 LONG RIFLE LODGE "Homemade”meals &pies.Fantastic view of the Matanuska Glacier,gasoline,bar,lodging and gift shop.Come and enjoy our family atmosphere and clean rooms.BLM campground right next door. (907)745-5151. MP 102.5 GLACIER PASS OVERLOOK PARK &RECREATION AREA (907)745-1320.Highest and widest viewpoint overlooking the Matanuska Glacier and Chugach mountains.The ultimate viewing and photo opportunity with picnic area,campground and limited facility RV Park planned to open May 1993.Walking distance to Long Rifle Lodge Cafe and public services. MP 113.5 SHEEP MOUNTAIN LODGE is famous for fine homecooked meals &fresh baked desserts. Specialties include homemade soup or chili served with a jumbo homemade sourdough roll.Private guest cabins,hiking trails,sauna,hot tub &RV parking are available.The views from the lodge are spectacular! Phone (907)745-5121. =February 8,1994 "Ove.CDRobertE.Harris Division of Energy FEB 14 1994DepartmentofCommunityandRegionalAffairs 333 W.4th Avenue,Suite 220 "+edeune OF ENERGY/DCRAAnchorage,AK 99501-2341 Dear Mr.Harris: I would like to comment on the proposed Copper Valley IntertiewhichwouldrunfromSuttontoValdez. I am a Sutton resident who has been actively involved in opposingtheconstructionofthisline.It became apparent to me at the beginning that political deals had been made in Juneau long before this project became known to the public.The citizens along the Glenn Highway,those whose lives would be most negatively affected by this fiscally irresponsible project,and who are going to have to live with it on a daily basis have been told by their legislator that "he"is not concerned with what or how his constituents on - this end of the district feel about the constructionof this line. Perhaps Mr.Olberg should be more concerned about what we "think" given the fiscal crisis this state is facing.Can this state afford to fund pork barrel projects such as this when viable alternative are available?I think not. The intertie becomes feasible only if the power demands ofthe Copper Basin increase at a "high to medium high"growth rate. Population of the Copper Valley has increased at a relatively low rate.The construction of this line is not based on the power demands of the residents of.the Copper Valley but on the "projected"power demands of Petro Star refinery in Valdez.PetroStarwouldhavetomorethantripleitspowerdemandsfor'the intertie to become more feasible than the Allison Lake alternative. The Copper Valley Draft Feasibility Study does not even address the issue of co-generation of electricity from the refinery itself or from the waste gases off the Alyeska terminal.Nor does it look to the probable construction ofa natural gas pipeline ending in Valdez in the near future.A line that would make cheap power a reality to the electric consumers in that area. We live in small communities in Alaska,not Los Angeles or Chicago. We do not have to make the same choices as the "Lower 48"when it comes to power generation.Why is the state choosing to run an intertie through one of Alaska's most scenic valleys when other alternatives are and will be available at less cost? We live in this area because we value our quality of life. Unfortunately,the feasibility study states that "quality of lifeissuesarebasedonsubjectivecriteriaandarehardtoquantify." what does this mean for us?Perhaps it means that the Alaskan spirit is dead.The legislators of this state do not remember why they or their parents came to this state.Yes,it offered opportunity but it also offered a quality of life higher than they had found elsewhere. Please be fiscally responsible and maintain our quality of life. Say no to this intertie project. Sincerely, Nancy L.Bertels P.O.Box 263 Sutton,AK 99674 Toi Rebert Harris,Director From'Charlene SchmidtkKonz.Division of Energy 20,Box 26 Sutton,AK. TA Comments resorting the Copper |che SE.VEDFeasilihtyStuds=Srogt Report, =FEB 14 1994 DIVISION OF ENERGY/DCRA Listening responsibly %ao learned skill.The peoplelivMe,in the.Motanuske Valles,have cavaht my attention,in tive depth oF heir expression,"|cooule'Vike to adc+o _thok strenath My AIM LNi gue,pent of view,_The,Metonuskte Valley assends CO miles FromSealevel+o the foot of the Matanuska Glacier.The. Beouraphy alone 1S unparalleled onuohere,it 18spectacular,"The Copper Valley Intectre identifiedroutesaccupy4Omilesofthislength.Theat 40milesisthecolminationoftheessenceand choracter of the Volleu __lhe.planning,in the DroftReportiswaitedtomirmize"'visval impact eve 'Elimination or Visual impact is Not in the,Executive Summarny .Ako "The aoparent oreferred route alternative would not be visible +o travelers along,the,Glenn Hiahwoayexcept4.Granite Creek.+e.Steshla Mountain seeCandfivemileswestofGlennallen."p-E-4 Execulive.Summary,Gronite and Streshia are with os here in the Mat.Vallew,Consider,The Glenn Highway will not be the only,VantageQotintinourStore,Alaska a2 SrOUI NnOyo four Sim ond "the draw"tothesemaanificerstsitesisatestementinitselfthattne.Medtanuska Valieu's Geography must be listerti +oresponsibly» AY 'feasiblity study would not 'have occurred,this industry being Petro February i,1994 RECE.:vcD Robert E.Harris,Director FEB 14 1994 Division of Energy ..DIVISION OF ENERGY/DCRADepartmentofCommunityandRegionalAffairs 333 W.4th Avenue,Suite 220 Anchorage,AK GQ5G1-2341 re:Intertie Feasibility Study Bear Sir: l was opposed ta the Intertie before the feasiiblity study,mainly for its environmental impacts and the detrimental impact on the quality of life of +the residents from Sutton to Glennallien and other residents of the state of Alaska,who use the area for recreation. How having read the Executive Summary of the intertie feasi and attended the public mesting at February 11,at Sutton,I have concluded that the intertie is likely to be an economic boondaggle.It is obvious that the costa for construction,even in '93 dollars,are going te be much greater than the cost estimate of $45.9 million.The costs of line construction,including helicopter time are all extremely conservative estimates.and the cost of a Static Yar Compensator is not included,not to mention the legal costs that will be incurred trying to obtain ROW across native lands.Who is going to pay for the added costs? 4t the public meeting.Mr.Richard Ernmeriman admitted that without thedemancforhigheramountsofelectricitybyacommercialindustry Refinery.|can understand the customers of Copper VaNey wanting lower electrical rates,But they should not be under the illusion that lower electric rates are the main purpose for the proposed intertie and there is no guarantee that their rates will lower.Right now the custorners of MEA are experiencing noticeable rate hikes.There is no guarantee thatPetroStarwillneedorbuytheelectricityitclaimsitwillneed,There are too many ifs involved with the study.Giving State money ta a project based on the supposed needs of cnée commercial interest is unfair to all the people of Alaska,This project is not being paid for by just CVEA consumers,but by all Alaskans,who are paying for it now and will he far future ganeratians. c "ay E] Craig BaerBeoF BawP.O.B&245 Sutton,AK SS674 vr om NESE I9 FEB 25 1994 DMISION oF ENERGY/DCRA Robert E.Harris.Director Division of Energy 'Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,AK 99501-2341 Dear Director Harris: I appreciate the opportunity to comment on the Copper Valley Intertie Feasibility Study draft report. I feel strongly that the liabilities of the project outweigh any benefits.In view of the fact that the state currently faces a fiscal crisis,more economical solutions should be pursued.Much of the justification for the project appears to hinge on projected consumption rates which are not supported by realistic data. Furthermore,should Petro Star ever require the power that Copper Valley Electric Association anticipates,generation in the vicinityoftherefineryshouldbeconsidered. The draft report underestimates both the direct and indirect impacts of the proposed intertie on those residing along the route as well as wildlife populations and existing user patterns of the region.As the Fairbanks intertie has shown,any such corridor produces much higher levels of ATV and snowmachine use. Consequentiy,the intertie would interfere with long-established hunting and trapping patterns of the region as well as diminish the scenic value along the route. Onee Sh esaeeeLsaalle,He 94697 FEB 25 1994 RWVISION oF EREnei,ou Robert E.Harris.Director Division of Energy Department of Community and Regional Affairs 333 W.4th Avenue.Suite 220 Anchorage,AK 99501-2341 Dear Director Harris:- I appreciate the opportunity to comment on the Copper Valley Intertie Feasibility Study draft report. I feel strongly that the liabilities of the project outweigh any benefits.In view of the fact that the state currently faces a fiscal crisis,more economical solutions should be pursued.Much of the justification for the project appears to hinge on projected consumption rates which are not supported by realistic data. Furthermore,should Petro Star ever require the power that CopperValleyElectricAssociationanticipates,generation in the vicinityoftherefineryshouldbeconsidered. The draft report underestimates both the direct and indirect impacts of the proposed intertie on those residing along the route as well as wildlife populations and existing user patterns of the region.As the Fairbanks intertie has shown,any such corridor produces much higher levels of ATV and snowmachine use. Consequently,the intertie would interfere with long-established hunting and trapping patterns of the region as well as diminish the scenic value along the route. Sincerely yours, "\sax0-/Zo (Cop VIS FF S5- 6 PIEPLF eevee:vZ7D FEB 25 1994 Division OF ENERGY,uCRA Afaafay Robert E.Harris.Director Division of Energv Department of Community and Regional Affairs 333 W.4th Avenue.Suite 220 Anchorage,AK 99501-2341 Dear Director Harris: I appreciate the opportunity to comment on the Coprer Valley Intertie Feasibility Study draft report. I feel strongly that the liabilities of the project outweigh any benefits.In view of the fact that the state currently faces a fiscal crisis,more economical solutions should be pursued.Much of the justification for the project appears to hinge on projected consumption rates which are not supported by realistic data. Furthermore,should Petro Star ever require the power that Copper Valley Electric Association anticipates,generation in the vicinityoftherefineryshouldbeconsidered. The draft report underestimates both the direct and indirect impacts of the proposed intertie on those residing along the route as well as wildlife populations and existing user patterns of the region.As the Fairbanks intertie has shown,any such corridor produces much higher levels of ATV and snowmachine use. Consequently,the intertie would interfere with long-established hunting and trapping patterns of the region as well as diminish the scenic value along the route. Sincerely yours. KAdhketWeWAX aGOESS MECE:VED FEB 23 1994 Division OF ENERGY/DCRA Box 38 Chugiak,AK 99567 Feb.14,1994 Robert E.Harris,Director Division of Energy Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,AK 99501-2341 Dear Director Harris: I appreciate the opportunity to comment on the Copper Valley Intertie Feasibility Study draft report. I feel strongly that the liabilities of the proposed intertieoutweighanybenefits.In view of the fact that the state currently faces a fiscal crisis,more economical solutions should be pursued. Much of the justification for the project appears to hinge on projected consumption rates which are not supported by realistic data.Furthermore,should Petro Star ever require the power that Copper Valley Electric Association anticipates,generation in the vicinity of the refinery should be implemented. The draft report underestimates both the direct and indirect negative impacts of the proposed intertie on those residing along the route as well as negative impacts on wildlife populations and existing user patterns of the region.As the Fairbanks intertie has demonstrated,any such corridor produces much higher levels of ATV and snowmachine use.Consequently,the intertie would interfere with long-established hunting and trapping patterns of the region as well as diminish the scenic value along the route. I have a remote parcel in the Loon Lake area and use this region for hunting and trapping.The proposed route of the intertie intersects our trapline.Attempting to mitigate the visual impact by routing the intertie off the Highway only transfers the associated problems to a different group of users.The scenery in our region is spectacular and the proposed intertie would be an unwanted and ugly addition to the region. I am not aware of any remote parcel owners in our area who supportthisproject.Most of us were unable to testify due to the location of the public meetings.Any future hearings should include one in Anchorage. D pte -_Daryl Douthat cc:Gov.Hickel Sen.Halford Com.Blatchford Rep.Carney P.O.Box 111410 Anchorage,AK 99511 November 8,1993 Commissioner Edgar Blatchford Department of Community &Regional Affairs P.O.Box 112100 Juneau,AK 99811-2100 Dear Commissioner Blatchford: We understand that consideration is being given to a high voltage power line to be constructed between Sutton and Glennallen along the Glenn Highway. We hope that route is not approved.A power line will haveaseriouseffectonthevisualbeautyofthatroad.As it is the Glenn Highway is one of the most scenic routes in the state and is appreciated by residents and tourists alike. If the power line is built,it will be just another blight on our landscape like so many in the South 48. Isn't there a way to avoid defacing it? .»Sincerely<pooq alors,rge Herben iscilla Herben {! WweGEG=NElNOV121993 . .,'3 Urrile SORARALINIT/2 REGI 1040 Meadow ealERE!WSFairbanks,alesNovember13, |NOV 15 1993 Edgar Blatchford P.O.Box 112100 SuINiwere ees se tCEJaneanelial&REGIONAL AFFAIRS99811-2100 COMMUNITY Dear Mr.Blatchford: This is regarding the proposed electrical power line from Sutton to Glennallen. It is hard to believe that such a project has evenbeenproposed. Obviously,the view and the wilderness are one of themajorattractionsandreasonsforbeinginAlaska.Howdoesoneenjoyitifoneseespowerlinesforone_hundredandtwentyfivemiles?This kind of visual pollution isunnecessary,destructive,and damaging to the soul ofAlaska. Please keep me informed of any hearings or material onthisproposeddevelopment. Steve Parker,Ph.D.Clinical Psychologist Ly;1 ; 2, tetbrIse 2S fer -ne ' . ; eer ote aSa eae ' : MTS November 15,1993 Department of Community and Regional Affairs Commissioner Attention:Edgar Blatchford P.O.Box 112100 Juneau,AK 99811-2100 Dear Mr.Blatchford: I want you and your committeeto know that I am against the funding and building of the intertie to Glenallen.I intend to vote against all'legislators who voted for this project unless this unnecessary project is turned around.I believe it is a result of strong lobbyist funded by the electrical companies who want a free ride.Of course,their excuse is "the electrical power is necessary.", The area where the interieis slated is pristine country and a national treasure like many parts of Alaska.We have a chance to "do it right"here in. this state--we should not let greed get in the way. Remind the legislators--many people will vote the walk in November. Sincerely, ")fonBouCree¢ Bev Grafel 10443 High Bluff Eagle River,AK 99577 Box 38 Chugiak,AK 99567 Feb.14,1994 Robert E.Harris,Director AESEIVEDDivisionofEnergyeeVetve Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 FEB 1§1994 Anchorage,AK 99501-2341 Division OF ENERGY/DCRA Dear Director Harris: I appreciate the opportunity to comment on the Copper ValleyIntertieFeasibilityStudydraftreport. I feel strongly that the liabilities of the project outweigh any benefits.In view of the fact that the state currently faces a fiscal crisis,more economical solutions should be pursued.Much of the justification for the project appears to hinge on projected consumption rates which are not supported by realistic data. Furthermore,should Petro Star ever require the power that Copper Valley Electric Association anticipates,generation in the vicinity of the refinery should be considered. The draft report underestimates both the direct and indirect impacts of the proposed intertie on those residing along the route as well as wildlife populations and existing user patterns of the region.As the Fairbanks intertie has shown,any such corridor produces much higher levels of ATV and snowmachine uee. Consequently,the intertie would interfere with long-established hunting and trapping patterns of the region as well as diminish the scenic value along the route. IT have a remote parcel in the Loon Lake area and use this region for hunting and trapping.The proposed route of the intertie intersects our trapline.Attempting to mitigate the visual impact by routing the intertie off the Highway only transfers the associated problems to a different group of users.The scenery in our region is spectacular and the proposed intertie would be an unwanted and ugly addition to the region. TI am not aware of any remote parcel owners in our area who support this project.Most of us were unable to testify due to the location of the public meetings.Any future hearings should include one in Anchorage. Sincerel urs,Cab Carol Douthat 7806 Linda Lane Anchorage,AK 99518 Feb.13,1994 Herb Hensley,Acting Director Div.of Energy,Dept.of Community and Regional Affairs 333 W.4th Avenue,Suite 220 FEB 15 1994 Anchorage,AK 99501-2341 aEcEe:.veED DIVISION OF ENERGY /DCRA Dear Mr.Hensley: I am writing to express my strong OPPOSITION to the proposed Sutton to Glennallen Intertie.I urge you to cut this from the budget.I offer the following concerns and arguments to support my opposition: 1)There is strong local opposition to this project as well as opposition by numerous outdoor groups. 2)The project would mar the beauty of the Glenn Highway- Talkeetna Mountain corridor,a major gateway for tourists in and out of our state. 3)Also impacted would be the quality of life,and in some cases,the economic base of the local residents who depend on unspoiled wilderness and wildlife for their livd€ihood. 4)The environmental impact of associated road constructionhasnotbeenadequatelyaddressed. 5)The huge cost cannot be justified with the budget short- falls the state is facing. 6)Alternatives such as a hydro project at Allison Lake, self-generation by Petro Star,co generation from gases at Alyeska,or use of more efficient generators have to be more seriously evaluated. 7)The feasibility seems to depend on a huge increase in demand from Petro Star,which may not be realistic. In summary,I urge you to REJECT the Sutton-to-Glennallen Intertie.Thank you for your consideration on this issue. Sincerely, William M.Cox M.D. Novi,§Ts:is bn BhdelLed °3 Ty <ar Sie T ASA Zsidewt WEaVeetueAenSXuseatheNal Keetaw Moa vrai a)(Arse C wid "The Pea Pose dPourweLinkeOr\ect Crom Sut Za Glew Alle.)=e bea Bt uaste ef ovr. Parstery Mtal.Ridge,Ante)Snell,Goldd\oal wi leet Sorted beie $0 Ady tEctartluat-Deplnds &leuried Gable-Mone s ide.mVeu Vara Why -ST lowld Ae \S +AASbrerey.Doh Nye BS eX Perrs sve "PlusSavenueNAtoentlardkKSReAsNoxTeMWetroydeSomeCondCan.Necessan'?Wiel boat ii Phe WwerrtsLowel.Mie LesPn ately Necbe&NS LoerioSDokMateResidentstyyeah, | 7 ae.77 aon t - HOV 12 693 Pern SS wi YWUMNIIDoNtunedfn0.0.Wy,52SOMMIUNITY?Srey TERETE ) Tal Keet wh -A\ASKA ---94g ICHAEL Koei s7e0TPOBOF(238 , OL CKALOON,AK 44674 DCRA_Com Mis S/oNeI oe ep EDGAR BLUATCHFORD ESET ED 1 PO.PO J1F100 _JAN 11 1594 :SUNERN,ALASKA AVBIl-D100 7 DIVISIONOFENERGY/DCRA ZL Apl WRTTO VOLE WY opPAOSITINL TDTHePRPos€2 Phuket LINE AMER-THETYAT Wipe ROATHRbefTHEMRTENOSARLAU,BLACK IS THE Onley STATEUWTHE.VOM)THATSTILLHASHEST=70-B000NESS.WILDERNESS,EVENTove!THE HIATRHIUSA YALE HAS A-Ytbd WY SOsomemilobevesementrhsFuroNTHEEDGELEVATHoursOFWILDCOUNTRY..2 FE BAT TS Powe wre Wie SYAELLebenceTEWouldTATEZCMLHME.LLM HEREBECOME5FTUEOuretTOFLicefiloHE.BEAUTIFUL|SURROUNDINGS,BoT Mist_OF Att 7.LIE HERE BECRUSELTLOBMTRESEIGLEPHYWERELUE.GEN WW WE__Lower 43,FTA WED:Lath:THAT DYE AllHES_____TREASURED,THE.PIwWEL LINE wile BEA mesure._SEP WM TOVPAIWE THE INATAN USKF VALLEY M/TOusrANoTHEence,/f Youle Ve _SENT AnyThEATBeHERE03NOW(Te NOT SUS_ANODE Perce,Fo 4 A lost aRBEN IEICENT |LUPZCSUIC.VAUEY,RES Dp wikt no cal 0 PAP Fu ASHERATERNITIVEtele.We PEOAE CE TUE CopPhR Ril.,ae GET THEW FLECTIC!TY,SHE THE2seauediiesliyFEMAmMTTAUCIBLE FATETHAMEYOU NOV_12 1993 eaeTvCUMMISCioouttect-He 'ee peteCOMMUNITY&REGIONAL AFFAIRS 2...cae eenee mECSEIVEDGERALDR.BROOKMAN 715 MUIR AVENUE FEB 18 1994 KENAI,ALASKA 99611 DIVISION oF ENERGY,February 17,1994 AOGRA Dear Mr.Hensley: I am writing to you at this time concerning the proposed Sutton to Glennallen power line Intertie project. I believe that at a time of fiscal uncertainty and the very real need to reduce state spending,this project is unnecessary and irresponsible. The environmental effects of this project are alse very real,and would argue against it's construction even if the money involved was not any _problem.From any standpoint,it is a loser,and should not be built, in ny opinion. I strongly urge your decision AGAINST this proposed project. Sincerely, wESEivVoD FEB 18 1994 DIVISION OF ENERGY/DCRA 1540 South Chugach Palmer Alaska 99645 February 15,1994 Herb Hensley,Director Division of Energy Dept.of Community and Regional Affairs 333 West 4th Avenue,Suite 220 Anchorage AK 99501-2341 Dear Mr.Hensley: This letter concerns the proposed Sutton to Glennallen Intertie. As a resident of the Mat-Su Valley,I frequently drive up the Glenn Highway for recreation in the Talkeetna Mountains.The fortress-like mountain walls,the rapid-filled Matanuska River, the frozen blue glaciers,and the relatively undisturbed wilderness make this an ideal area for recreation and Sightseeing.Construction of an Intertie along the Glenn Highway or in the Talkeetna Mountains would spoil this scenic byway. I urge you find an alternative to the Intertie that will have no. negative impact on the environment. Sincerely, Diane Saliee HC60 Box 306T Copper Center,AK 99573 February 15,1994 Richard Emerman,Economist Division of Energy 333 W.4th Avenue,Suite 220 RECEIVEDAnchorage,AK 99501 Re:Copper Valley Intertie Feasibility Study -Draft Report FEB V7 1994 Dear Mr.Emerman:DIVISION CF ENERGY/DCRA First of all,I want to thank you for a well-run meeting in Glennallen.Following are my camments on the draft report: 1)The report does not indicate what CVEA customer rates might be after construction of the intertie.A CVEA representative present at the Glennallen meeting stated that CVEA had not even begun to calculate projected rates.Most people who cammented in favor of the intertie at earlier stages listed reduced or stabilized rates as their main reasons for supporting the intertie,but this report does not give those people the information they need to evaluate the project. 2)The report does not adequately discuss factors that could work against rate stabilization if the intertie is built.One of these is the lack of a firm,long-term commitment fran Petro Star..Another is the possibility that the price of Belugapowercouldrise. 3)Despite the great length of the report,very little space is given to intertie alternatives.The reader is not given enough information to evaluate factors other than cost that might make these projects more or less attractive. 4)Discussion of the conservation alternative is limited to technology.Habits, such as the simple act of turning off a light switch,are not discussed.Furthermore, even the technology discussion may have missed some important points.Heat tapes, and ways to reduce reliance on them,are not mentioned,yet they are commonly used in the Copper River Basin to keep wells and pipes from freezing.Did R.W.Beck survey any of the homes with high electric bills to find.out why those bills were high?The report should have,but did not,discuss what services CVEA could provide to help customers identify the reasons for high energy use.Conservation will not 'lower energy rates,but it will lower energy bills,and that is what matters to most CVEA customers. 5)Opportunity costs are not discussed.It appears that the State would be foregoingaverageinterestof$1.5 million per year for fifty years on its $35 million/year intertie loan.If that loan were not made,what other things could the State spend $1.5 million for in Valdez and the Copper River Basin?More state troopers?Fire trucks?Emergency medical response vehicles?Small business loans? The draft report,despite its great length,is inadequate and does not convince me that the intertie is a good investment for the State of Alaska or for CVEA customers. incerely,fTlodbaz:eeRuthMcHenry ALASKA SURVIVAL 3.2-97,Box 320 Talkeetna,Alaska 99676 (907)733 peeor. oi3]94 | | To Herb Nensle-,Retin OretoD DivcaceyD This nega rola VAL Suttoyo to KLhnxaLherntesa4FeawbteSaat,|is SU WaTTS ava Sones mmatia RECEIVED FEB 17 1994 DiVIS!oN OF ENERGY /DCRA COLAO Pave.Not ALOELM ATO!.. BO WOUILN unpack CUA ee wan V WAVTED Yhesibateseo/5 Cen OD AL hs YA SQD-FODOSAnroltytaLO Not) Feb.8,1994 P.O.Box 2176 Palmer,Alaska Edgar Blatchford Commissioner RECEw;wED Dept.Community and Regional Affairs Juneau,Alaska FEB 14 1994 Dear Mr.Commissioner,DIVISIONOFENERGY/DCRA Please consider my opposition to the proposed electrical intertie between the Copper Valley and the Matanuska Valley. I am opposed to the project as proposed for two reasons: First,the towers and overhead cables will be ugly as hell in a beautiful valley.Let's not impose that aesthetic cost on the Matanuska Valley residents to benefit folks in Glennallen. Secondly,the intertie costs us more than its worth.For the cost of the intertie,estimated at $46 million,you could buy a $15,000 generator for each of the 3,000 current CVEA rate payers.Seen another way,the interest on that capital money could subsidize $1,200 of the average ratepayer's share of CVEA's annual operating expenses.The CVEA area users would get more electricity,and the rest of us would be saved the trouble of the powerlines. This state cannot afford to continue subsidizing users who live in remote areas and then ask others to pay for the difference in costs attributable to their remoteness. Perhaps the $35 million loan to AIEDA could be rescinded by the legislature to help close this year's fiscal gap. Thank you, Mike Bronson cc:Rep.Larson wnEce:veED FEB 18 1994 Feb.16,1994 DIVISION OF ENERGY/DCRARichard£Havris,Diveetor PASE ON Enev:Deel of Community £Ragional Mais33DWw.qe LAN@nue,Suite ADOAnelovase,Alaska 97501-2324] re:proposed Sutton to Glennallen Intertie Dear Win.Harris, The grid system of supplying electricity to customers is not a feasible plan for Alaska's varied terrain and vast area.|feel that each area of our state,such as Copper Valley,should generate electricity for themselves,for safety and reliability factors.lf Bradley Lake hydro, Healy's coal and Beluga's natural gas plants were all controlled by one switch,what would the impact be if that switch was in the hands of terrorists or a radical political party? Petro Star Refinery -finagled a way of piping their waste into the City of Valdez.Now,Copper Valley Electric,because of the assumed need of power that Petro Star will require,is requesting state dollars to build an Intertie,to tie in with the south-central power grid.|ask,why should the State of Alaska spend between 45.9 million to 70 million doNars to provide for Petro Star Refinery?What will happen to Petro Star when oil no longer flows through the pipeline? That scenerio could happen as soon as the year 2013. My suggestion is that CVE more fully explore the Allison Lake project,which would tunnel water from Allison Lake to the current hydroelectric plant of Solomon Gulch.The economic impact on Valdez would be positive and the environmental impact minimal.Minimal,in comparison with the environmental impact an Intertie would have on the scenic Glenn Highway. Sincerely, MSAK ennifer Baer P.0.Box 245 Sutton,Alaska Q9674 ZU04 Faurtoanil ) Princ,RAZ,Gee 27 1S=9H Cole!Havaiss Died 'any Oar Dinitton ot bngqy ASE /,cortrbele.4HatIxpotSankapt Ket)ec jn S095 -Leonomle Chaos,gt gor 4 boron BALbawA.goo teat fy for ctake apveAadIsfilacteselfsta"Ad hess polletag,bal HKDegically7CAprsS1OnesHeLNats gad cents A NedsCuEA|gra He pon VANE ”Prin keg{of CUEA dort,7,Mayanelert,oe,Age costs,art Gn aged are 3)Al Lawl Hat 7 whet uc,the taxparersFhpoyjhepaleMadeaLvolk,,Gre nt ued a genase1?noth 5,md 2 few zal,eck my bibeg #FLe rate YY Hut Le Cf HL.Y A go brea 4 pMoveRibalGarCdnoct),(2 SOC basing LeabendertEnshixeCoeseldersile beaad),wind C ster hae ba.Sreh).jr dre,geothernal,ae fl Te gabe 0)ot Ahad.1S Lived ZL,hunks -a beeler a the breqy Fall Cpe thyecarteUWIrotLarlereptor7VE,tang ofr totes)A.naka! PS LD wil---Ww (Call &AC Carpe A metting lanhextweekXD)ppo-thbie veerd LOUp Ipod ig UIM -Ge EL mECeiw0D FEB 23 1994 DIVISION OF ENERGs/uCRASE.ly hor Thre Cynrare: ee ee PRLAER,Bk 996 ESLIA746-027 February 16.1994 re:'CVE Intertie Feasibility Study FEB 23 1994DivisionOFENERGY/DCRASearma.NALS We sre apposed te the Sutton to Glennallen Intertie because of environmental and quahty or lite issues.Now,however,it has become clear that in spite cf a mighty effert by C.V.E.A.and R.W.Beck to make it so,the intertie is simply not economically feasible.In the most likely growth scenarios,other options are cheaper.Gniy in the most fanciful growth scenarios does the intertie become feasible. e The above is true before even considering what was left cut of the feasibility study:, An environmental impact statement, Cost of htigation that is certain to come. Lucicrous underpricing of various aspects of the praject, as if it could be ouilt for iess than half the dollars per mile than the Bradleu Lake Transmission Line,a comparable project: 4.No examination if anu venture capitalists would back the proposed bands sr any inquiry into if sellabile.The State could easily end up funding these undesirable bonds.(MdKDThe last point illustrates the nature of the intertie proposal.Although the issue is being cast as one where a small selfish group of peopie alang the Glenn Highway are apposing the Intertie,the truth is people know it is economically unfeasible and simply amounts to corporate welfare for ane company,Petro Star Refinery.Petro Star refines oil into jet fuel -.let them generate their own power.And look at the trouble that one of its partners,Neit Bergt,has already caused this state. in his State of the State aduress,Governor Hickel challenged the legislators to find ways to cut the budget.We say cancel the Intertie. anc spend those dollars cn the existing infrastructure that are sorely in need of maintenance. Sincerety yours, Jefi Arndt Mary dorrott nESe vod 831 Jay Circle FEB 23 1994 Anchorage,AK 99504 . February 18,1994 DIVISION OF ENERGY/DCRA Herb Hensley Division of Energy, Department of Community and Regional Affairs 333 W Forth Ave Suite 220 Anchorge,AK 99501 Dear Mr.Hensley: My husband,Michael Burwell,and I are strongly opposed to the construction of the Sutton-Glennallen intertie because of the destruction of pristine and valuable wilderness,because of the extraordinary cost of the project at a time of budget crisis in this State,and because alternative methods of providing energy to the Glennallen area are much more justifiable.Please contribute your energies to a reconsideration of this project. A,fle Z_-Sally J.Carricaburu aHC60 Box 306T Copper Center,AK 99573 February 17,1994 | FEB 23 1994 nECEwelO Richard Emerman DIVISION OF ENERGY/OCRA Division of Energy,DCRA 333 West 4th Avenue,Suite 220 Anchorage,AK 99501 Dear Mr.Emerman: While stabilizing electric rates and providing extra power for future progress in the Copper River basin are creditable goals,CVEA's proposed Sutton-Glennallen Intertie falls short of the task.As currently designed,the intertie is a "conditionally feasible",intermediate power conveyance with a weak link at either end:the fragile 115 kV MEA system to the West and the avalanche-prone Glennallen-Valdez tie line to the South.Both will require considerable reinforcing and safeguarding to transfer the increased power loads anticipated. Paradoxically,instead of greater reliability from the proposed Intertie,CVEA will probably experience less dependability due to total or partial blackouts resulting from vagaries inherent in the Railbelt utilities and MEA systems. To build this intertie right (i.e.,constructing the line with 230 kV conductors and larger transformers for an eventual link-up with Delta Junction-Fairbanks, thus 2-way transmission with the Railbelt Intertie)would be the ideal situation.However,this project would entail substantially more capital and planning basedoncrucialneedanddemonstrabledemand,neither of which exist at this time. Perhaps the most regrettable aspect of the proposed intertie is that crucial need and demonstrable demand are lacking.Although CVEA argues that Petro Star's planned accelerated load demand to 5.5 MW by 2004 is justification enough to warrant building the intertie,Valdez district's 14.6 MW winter peak generating capacity now appears to be more than adequate to meet its potential medium-low growth electrical demand throughout the 20-year study period.Also,Petro Star evidently is not concerned about sufficient electricity availability from CVEA for production expansion.The refinery has the capability to co-generate its own power from waste heat and gases,but has no plans to.Or it could possibly tie in with Alyeska Pipeline Service Company's terminus power supply via a short transmission line.The fact that Petro Star's electrical contract with CVEA expires in 1998,which coincides with the end of its most rapid expansion period, suggests that they may be operating on short term only.The distinct possibility that both Alyeska and Petro Star may be gone after 2013 if the oil pipeline runs dry,should further caution CVEA against indebting itself (us!)$60+million for 50 years.Building the proposed Intertie on the basis that one oil industry subsidiary might stick around is not only tenuous but ludicrous! If CVEA deems that additional power generation is imperative prior to the TAGS project start-up in 2005,it should pursue the 27.3 MW Allison Lake-Solomon Gulch hydroelectric option.This project is the lowest cost alternative for the medium-low load growth scenario,would be operational only a year or so laterthantheproposedIntertie,and would avoid the myriad electrical (outages,-voltageandfrequencyfluctuations),social,economic,and environmental consequences of constructing and operating the Intertie.Strengthening the Glennallen-Valdez tie-line and/or purchasing a new 2.2 MW diesel generator for the Glennallen distribution segment would "complete the circuit"and supply CVEA with adequate,relatively cheap,trouble-free power for the foreseeable future. In summary,I believe CVEA would be making a collosal error in judgement by selecting the Sutton-Glennallen Intertie option.Not only would it be too expensive in the final analysis and troublesome in all respects,but there is no compelling reason (demand)to build it.The wiser choice,I think,would be to construct the Allison Lake hydropower project to accomplish the objectives of stabilizing electric rates and providing extra energy for future development. This would allow CVEA to remain separate from the attendant power distribution ills of the Railbelt utilities and MEA system,and thus retain its electrical , integrity.When,and if,the TAGS mega-project is completed by 2009,there should be an abundant supply of natural gas to generate all the electrical energy that CVEA could ever use,and more.Maybe by then there will be a demonstrable demand for an intertie to the Railbelt from both ends,and sufficient capital to build it right the first time.Neither CVEA nor the State of Alaska can afford a costly boondoggle Intertie at this budget-crunching juncture. Sincerely, Lhucl Te MfEdwardT.McHenry It fosery Harts ,February 19,1994 neeen®®FEB 23 1994 DIVISIONOFENERGY/DCRA The draft report for the Copper Valley Intertie is out.As a big game guide dependent on tourist dollars,and a resident of Chickaloon,I'm not satisfied with R.W.Beck And Associates'conclusions.The intertie cost analysis makes many assumptions which reports of this nature must,the question is,are they accurate?We residents of Chickaloon and Sutton have .reason to believe they aren't.The report gives short thrift to the alternatives which appear to be mere straw men. The helicopter dependent construction costs are estimated to be only half what the Bradly Lake helecopter dependent costs were "without"adding inclearingcosts.Right of way acquisition costs are clearly underestimated since the original Athabascan hunter gatherer land owners are adamantly against theproject. Of the six scenarios looked at in the report only one -the intertie - affects the upper Matanuska valley.The other five impact only the Copper valley where the power would be used.This is an important factor not adequately addressed in the report. Interestingly,the effects of promoting conservation through energy efficiency were only applied to their present power generation system.Conservation measures "weren't"applied to the others.This is significant when the report can only show clear intertie superiority for high electricalloads.These high loads also depend on a huge increase in electrical needsbythePetroStarRefineryinValdez.Petro Star could,and quite possiblywill,produce their own power cheaper just as Alyeska already does at theValdezTerminal.The intertie doesn't promise lower electrical rates for Copper Valley customers,and it also doesn't promise that MEAs'customer rates wouldn't end up higher because of it.There is,however,one promise.If the intertie is boondoggled through,the upper Matanuska valley /Chickaloon Pass highlands will be visually andculturallycompromisedforourlifetimes. Sincerely,fe he /Brac uctLlMtsiid.Li Qa celeoC P.O.Box 1148 Chickaloon,Alaska 99674 ,oo dep 4.199MireRider}Terres y a or OF Jy was Vue Gene/eslo af Ke W Beck and 71550 Gates at SWICE eatity -O {kite CannedbefunHavnbpMes,VL SepefonefaspoMaliabannevalve. J Lele Ve Vhs valte gies!be address,ane very som.befert anfInireWiltaudbeavk,/places PE /tost OF CO?ve VIEL A Yle ame ¢f | praspess”ed ong bost.Dn his case,Ye rewards of sockPOYlssareapbes?Gus venalle che fe.Ye 688 A ur vel 15 yaear aucPLIONLNCyl/. p Le 5-0 Aen.,JL y|bh pper-Vaden usherUghliyLecememeofYe"fest”Oleces ;ind”Oppose We By rte | Sracere hk Janie bracndek. Warren Keogh )February 17,1994 P.O.Box 1166 ) Chickaloon,AK 99674 weECe.vCD FEB 23 1994 Edgar Blatchford,Commissioner DIVISION OF ENERGY/DCRA Department of Community and Regional Affairs P.O.Bax 112100 Juneau,AK 99811 © Dear Commissioner Blatchford: Enclosed please find a copy of testimony I recently gave at a public hearing in Chickaloon, Alaska,regarding the draft economic feasibility study of the proposed electric intertie project through the Matanuska Valley.I write you to voice my views on the feasibility study and the proposed project.My purpose in writing is also to make you aware of the strong and growing opposition to this intertie project by citizens in the communities of Sutton,Chickaloon,and Glacier View.Listening to the several hours of testimony against the intertie in the recent hearings,recorded by the Division of Energy,might give you a good indication of the breadth and depth of opposition by local rural residents.There are alternatives to this proposed project that are more sound economically and that are less disruptive socially and environmentally. Thanks very much for your attention. Sincerely,mfI; Warren Keogh ce:Herv Hensley,Director,Division of Energy -------- P.O.Box 1166 Chickaloon,AK 99674 February 11,1993 Division of Energy Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,AK 99501-2341 Subject:Formal Public Testimony in Chickaloon,Alaska.February 11,1994. Proposed Electrical Intertie through the Matanuska Valley Iam Warren Keogh,a resident and landowner in Chickaloon.I am speaking for myself and my family andI do not represent any organization.Due to difficulties obtaining a copy of the full report and without an opportunity to read it,my comments are based on the executive summary only. )) I have attended previous public scoping meetings in Chickaloon or Sutton regarding the proposed Matanuska Valley Intertie.During the most recent meeting held in Chickaloon (June 2,1993)I tried to express my feelings and concerns regarding the- negative impacts of the possible construction of an intertie through this valley and through this community.Those concerns are ones of what this draft report would term "quality of life”and environmental concerns.Under the "Environmental Review"section of the report,the concluding paragraph on page I-9 states,"Potential effects on the community can be difficult to measure”,and "Quality of life issues are based on subjective criteria and are hard to quantify." It has been my impression that when I or others have raised these "quality of life" issues in meetings conducted by the State,little weight is given these concerns.Either they are not understood or they are discounted because they are not quantifiable.There are two reasons why.The first is,as the report accurately states,that it is not easy monetarily to quantify subjective values.The second is that not one of the active proponents or evaluators of this project reside here.Thus it is difficult if not impossible for them to appreciate the magnitude of positive subjective values many Chickaloon people give to this place,as well as the magnitude of negative subjective values people ascribe to impacts of intertie construction.You cannot reside in Valdez,Glennallen,or Anchorage and really know this place and know the people who live here.Your absence does not allow you torespect,to know,and to care for this place with the same feeling that I and others do.Not only do you value it less,you devalue this valley and this community with this lack of respect.Some of you have behaved ignorantly and arrogantly by assuming that people here are weak,acquiescent,and uninformed.You assume this land has greater worth with a powerline than without it.You view this part of the Matanuska Valley as just another place on the map that the intertie will be routed through.I view Chickaloon as my home,It is a place I care for greatly,and a place where I assume the intertie will not be. Regarding the Feasibility Study.Those funding this economic feasibility study and those conducting the study have arrived at inaccurately low cost estimates.This study is flawed in four ways.First,it appears the untoward effects intertie construction would have on land-use value,recreation value,aesthetic value and land value are considered but not entered into cost estimations because they are difficult to quantify.Since they are not easily quantifiable they are omitted from the cost estimation.This omission renders the analysis incomplete.The economic analysis methodology is inadequate,inappropriate,and may indeed be invalid. Second,if one does assume this questionable methodology has validity,one finds omissions here that create underestimated intertie costs.An example of such omissions occurred with a powerline project in Minnesota in the late 1970s.*There,initial cost estimates were inaccurate because of inept planning and because there was a failure to perceive the extent of local opposition to powerline construction.Initial cost projection for the Minnesota energy project was $537 million.Unanticipated expenses added $703 million to the cost of the project,more than doubling the expected costs to over $1.2 billion.Among other omissions,the cost analysis for "Preferred Route Alternate D”does not account for costs secondary to protracted legal action,acts of civil disobedience,acts of vandalism,and acts of sabotage.Such actions could occur and would certainly result in significant cost overruns for transmission line construction,engineering services,ROW acquisitions and permitting,construction management,owner costs,and contingency costs. Third,projected energy requirements for CVEA customer Petro Star are highly suspect.Energy projections are based on corporation statements alone.It is my understanding that the owner of one of the two corporations controlling the Petro Star Refinery has a history of bankruptcy and insolvency.If such is the case,how much weight should be given to future projections of a previously bankrupt and potentially bankrupt owner?The credibility of speculative corporate statements is extremely questionable. These estimates of energy requirements may be inflated and certainly are tenuous. Finally,the "Intertie”power supply scenario in Table I-5 on page I-15 of the executive summary is optimistically low.Expected maintenance,operation,and. management costs due to acts of vandalism and sabotage are likely greater than CVEA expects and this report predicts.Again,the powerline through rural Minnesota is illustrative;post-construction operations and maintenance were high due to ongoing actions by angry rural citizens.Rates of load growth and fuel price escalation are only part of the equation for the "Intertie Scenario”depicted in the table representing "Cumulative Present Value of Comparable System Costs". Thus,the draft report of the proposed intertie through the Matanuska Valley is flawed to the extent that it is unacceptable.The methodology used is inappropriate,the cost estimate for the development of the intertie is seriously underestimated,projected energy demands by Petro Star Refinery are highly suspect,the feasibility level environmental analysis is inadequate,and the costs for the proposed intertie compared to other resource alternatives is inaccurately low.When cost estimates for the intertie through the Matanuska Valley are adjusted upward to reflect a more accurate figure,other energy scenarios become significantly more feasible and economically superior.This study inaccurately describes the economic plausibility of the proposed intertie.This ill-conceived and improbable project,with its flawed economic feasibility study,is a disservice to the citizens of Alaska. The state government is presently faced with a budget crisis and a deficit approaching one billion dollars.Moving forward with this proposed intertie project would -glaringly typify the kind of economic irresponsibility and misappropriation of state revenues that leads to these kinds of Alaskan fiscal dilemmas.The proposed Northeast Intertie of - 1989 was not feasible and was scrapped.**This misconcetved project has surfaced again and should now have the same fate it had five years ago.Though not accurately reflected by this feasibility study,the current proposed intertie through the Matanuska Valley is economically unsound and should be terminated as soon as possible so the other Copper Valley energy options of real viability may be seriously considered. *Barry M.Casper and Paul David Wellstone.1981.Powerline:The First Battle ofAmerica's Energy War.Amherst:University of Massachusetts Press. **Power Engineers Incorporated and Hart-Crowser Incorporated.1989.Railbelt Intertie Reconnaissance Study,Volume 8A and 8B,Northeast Transmission Intertie Project.Anchorage,Alaska:Alaska Power Authority. bau!)aslWarrenJ.Keogh cc:Chickaloon Community Council Alpine Community Council Glacier View Community Council Assembywoman Mary Geist HECEIVOD FEB 23 1994 DIVISION OF ENEH1/UCRA February 20,1994 Herb Hensley,Acting DirectorDiv.of Energy,Dept.of Community &Regional Affairs 333 W.4th Ave.,Suite 220 Anchorage,AK 99501-2341 Dear Mr.Hensley, lam writing to state my disapproval of the Sutton to Glennallen Intertie.I do not think the time is right for this expenditure and it is a very large expenditure.Why are we doing this with our current budget deficit? Who stands to benefit Gn our lifetime)?I understand that Copper Valley Electric will be getting a $35 million,interest-free,50 year loan and Petro Star Refinery will be the principle user of the electricity.Do these businesses need subsidizing that badly? Being an outdoor recreationist and environmentalist,I personally find the scenic and wildlife habitat values along the proposed route more valuable than the business subsidy,but even without those considerations, the project looks like pure pork. Sincerely, Calis Meek Christine Maack 3522 Alexander Ave. Anchorage,AK 99508 Herv Hensley,Acting Director, Division of Energy,Dept.of Community and Regional Affairs RECEIVED 333 W 4th Ave.,Suite 220 Anchorage,AK 99501 | FEB 23 1994 DivisionRe:Response to call for public comments on the Sutton to Glenallen Intertie feasibility study oF ENERGY/DCRA Mr.Hensley, The draft feasibility study for the Sutton to Glenallen Intertie hardly makes the $35 million dollar state loan to construct this project look like a good investment.|urge you to reject the feasibilitystudyasunsatisfactoryandallowthe$35 million appropriation from the 1993 legislature to return to the state's general fund,where the money can be better spent on essential services for the people of this state,or returned to the constitutional reserve fund where is should have been placed initially. The R.W.Beck and Associates study seemed to be tailored to one industrial consumer,Petro Star Refinery.If |were a CVEA electric consumer,|would be very concerned about the future of my ratesbeingsodependentonthe!oad growth cf cone commercial consumer.Even with the sweet deal of a 50-year,zero percent interest loan of $35 million,if the Petro Star refinery does not increase it's electric demand substantially,someone else will be left to repay this and any other debt incurredfromthisbloatedcapitalproject. If Petro Star truly needs a large amount of electricity,they should be required to sign a "take-or-pay"contract with DCRA for the amount of the electricity they claim to need.The feasibility study shoulddescribehowPetroStarwillstayinbusinessuntil2047giventhedecreasedflowintheTrans-Alaska Pipeline.The study should also address how much energy could be produced by co-generation using gases vented from the Alyeska terminal in Valdez. The estimated costs in the feasibility study also seem to be unrealistically low.In the preferredintertieroute,the estimated cost per mile is $254,000.In comparison,the Bradley Lake intertie cost _$505,000 per mile.|have watched both small and large capital projects grow way beyond their initial cost estimates many times.It seems that the bigger the project,the larger the margin for error in these initial estimates. There are realistic alternatives.Petro Star could generate some or all of its own power.The Allison Lake hydro project could be chosen instead of the intertie.The diesel generators currently being used could be upgraded. In light of the many questions unanswered by the draft feasibility study and most importantly,theneedforustoreigninsomeoftheexcessivespendingofthe1993legislature,this project should not proceed any further.Please make your official finding that the study is unsatisfactory and the project is unfeasible. Thank you for your time and consideration of my comments. Sincerely, Claire Holland Star Route,Box 3800-B Kodiak,Alaska 99615 cc:Governor Walter Hickel, Senator Fred Zharoff Representative Cliff Davidson FEB 23 1994 DIVISION OF ENERGY,cCHAKatherineWright H.C.0.3 Box 8496 Via:Palmer,AK 99645 I live at Sheep Mountain and I am a Copper Valley Electric Assc. co-op member.I am totally opposed to the Sutton to Glennallen intertie. The feasibility study has shown that the intertie is too costly for our needs.The electrical load increase of C.V.E.A.in the last 10 years is minimal and does not warrant a project and debt of this size for our modest co-op,especially with the Aleaska Pipeline winding down.Petro Star's claim for increased electric load for the future is ridiculous and can not be substantiated.They should be made to doa"take or pay guarantee"with C.V.E.A.and the state. The reason that most C.V.E.A.co-op members are in support of this project is because general manager Clayton Hurlus told us this project would lower our rates and was the only solution to our problem.He convinced most members and now both claims are inaccurate. I support the Alison Lake Project.It is alot less money and would support local economy and be sustainable energy.Then,the residents of the Glenn Highway would not be forced to ruin their main economic base,which is tourism.Our scenic resource is not to be dismissed as expendable.We have no guarantee from Mr. Hurless it will not go along the highway and,with the action he displayed with us over lower rates ,he has shown he will say wnat he will to get his way.Katherine WrightKathrineddrsler a -17-99 the (ble Cogponiand portion yf DaftHintZe.asubile tity |wECaivVED FEB 23 1994 DIVISION OF ENERGY/DCRA Thomas Wright H.C.0.3 Box 8496 Via:Palmer,AK 99645 21 Feb.'94 I am a Copper Valley Electric Assc.co-op member.I am totally opposed to the Sutton to Glennallen intertie. The feasibility study has shown that the intertie is too costly for our needs.The electrical load increase of C.V.E.A.in the last 10 years is minimal and does not warrant a project and debt of this size for our modest co-op,especially with the Alaska Pipeline winding down.Petro Star's claim for increased electric load for the future isridiculousandcannotbesubstantiated.They should be made to do a "take or pay guarantee"with C.V.E.A.and the state. The reason that most C.V.E.A.co-op members are in support of this project is because general manager Clayton Hurlus told us this project would lower our rates and was the only solution to our problem.He convinced most members and now both claims are inaccurate.I support the Alison Lake Project.It is alot less money and would support local economy and be sustainable energy.Then,the residents of the Glenn Highway would not be forced to ruin their main economic base,which is tourism.Our scenic resource is not to be dismissed as expendable.We have no guarantee from Mr. Hurless it will not go along the highway and,with the action he displayed with us over lower rates ,he has shown he will say what he will to get his way. Come on folks!We're not al]ignorant out here,no matter whatMr.Hurless may think.Common sense tells us that,since the state is so strapped for money right now,the intertie is going right down the highway!!Surely,with the arsenal at your disposal,you can afford to shoot straight without first laying down a smoke Wilagll.Doe RECEIVED FEB 231994 DIVISION oF ENERGY/DCRA 18 February 1994 Herb Hensley Acting Director Divison of Energy Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,AK 99501-2341 Re:Sutton to Glennallen Intertie Dear Mr.Hensley, I am strongly opposed to construction of the Sutton to GlennallenIntertieandurgeyoutocanceltheprojectandsave$60.million,which can be used to balance the existing budget shortfall,and the more than $76 million in interest giveaway to Copper Valley Electric Association.The intertie is strongly opposed by local residents,conservationists,Native peoples,local businesses andChambersofCommerce,and local governments.It shouldn't bedifficulttocancelthisprojectastherereallyseemstobelittle support. And the conflicts it would produce are tremendous.The Glenn 'Highway is one of the most picturesque in the world.The intertie would take that view away,as well as interrupt wildlife and migratory bird life. But most of all,the intertie is a waste of money and is not needed.From previous cost estimates on other energy projects,itissafetoconcludethatthecostwillexceedthecurrent$60 million price tag.The state will lost $76 million in forgoneinterest.And the only beneficiary seems to be a proposed Petro Star refinery.What evaluation has taken place on alternatives to the intertie to support the refinery?Have you analyzed an Allisonlakehydropossibility,or some kind of oil or gas generators? These seem to me,on the surface,to be much more cost-effective and would take away all the intertie conflicts. Thank you for the opportunity to comment. Sincerely, LBLStratton 12821 Mountain Place Anchorage,AK 99516 cc:Governor Hickel,Senator Steve Rieger,Rep.Con Bunde Ronald H.Dailey 7841 Port Orford Drive Anchorage,AK 99516-1022 (907)563-3066 (Day) (907)346-3737 (Evenings) February 11,1994 Mr.Richard Emerman Senior Economist DIVISION OF ENERGY,DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS 333 West Fourth Avenue Anchorage,AK 99501 RE:Suttor-to-Glennallen Electric Intertie Dear Mr.Emerman: Copper Valley Electric Association is studying the concept of an Electric Intertie between Sutton and Glennallen.Since |own a cabin near Chickaloon,|am concerned that such an Intertie would effect the area around my cabin. ]reviewed the preliminary report prepared by R.W.Beck &Associates.Their estimates of future power needs vary greatly.In short,this wide variation indicates that future power needs are uncertain.) When one considers the costs and berefits of this Intertie,it is clearly a bad idea. We should not build this Intertie to satisfy UNCERTAIN future needs,while we are CERTAIN of the loss of scenic beauty and other costs. Thank you for your consideration. Sincerely, [Covad {\coresRonaldH.Dailey .. Art Eash P.O.Box 240801 Anchorage,Ak 99524 907 261-2233 February 11,1994 Mr Richard Emerman Senior Economist Division of Energy,DCRA 333 West Fourth Avenue Anchorage,Ak 99501 re:Sutton to Glennallen Intertie Dear Mr Emerman, As a property owner in the Chickaloon area and long time user of the Chickaloon recreation areas,and also as a one-time economist who has reviewed and analyzed two major electric power projects,I am concerned about the announced intent to construct a project of this magnitude in our area. Apart from a very suspect "preliminary report"by Beck & Associates,which uses as an essential premise and rationale a very vague and completely uncertain estimate of a SINGLE FIRM'S power demands in the future,the nature of the project needs an unbiased review.Having grown up in Washington state,I recall clearly a similar,if far larger,version of the same problem which can be summarized as follows: A few individuals proposed to build a project which would enrich only themselves and only temporarily benefit some construction firms;. The service area's best interest was jeopardized (in that case safety from nuclear contamination,in our case destruction of exceptional scenery and possible safety issues emanating from serious questions as to electromagnetic effects on people living nearby);and The process ignored the one factor which ultimately proved to cause a shift of the demand curve BACK,not outward,despite increased population,namely,conservation of electric energy. This last phenomenon has reappeared in several parts of the country,and should serve as a useful example for us here.Conservation of energy has almost universally resulted in asubstantialreductionofbudgetedexpectationsbyutilities.Ourcaseappearstobenoexception,and I urge you to consider the very small and temporary benefit to be had by construction of the Intertie.Save the money,save the view in Chickaloon,and resist the tremendous pressure by the very few beneficiaries who promotetheproject. Sincerely,(Cast AECEIVED Paul F.Twardock FEB 23 19941237W11th 907-279-0409 2-20-94 Herb Hensley.Acting Director Div.of Energy,Dept.of Community and Regional Affairs 333 W.4th Ave.Suite 220 Anchorage AK 99501-2341 Dear Mr.Hensley, I would like to express my displeasure of the Sutton to Glennallen Intertie Draft Feasibility Study.The preferred alternative in the draft should not be picked because: 1.Economic Unfeasibilitv:The intertie option has costs which have not been included in the draft feasibility study.Economic costs such as lost tourism .business,health costs,loss of subsistence hunting'fishing with increase pressure on fish/wildlife,and maintenance costs.Furthermore social costs have also been ignored,costs such as disruption of communities along the route. Based on the report itself the intertie is only justified if power quadruples at Petrostar.The whole project's rationale according to your representatives at public meetings is based on Petrostar's needs.I object to such a project being pushed through at the public's expense for one commercial venture.CVEA ought to be required to factor paying the whole costs of the project,including interest on the approved loan.. Finally I wonder are the costs of the study realistic?I am quite familiar with the area and wonder why snow avalanches are not mentioned in the report as a hazard which will cost significant amounts to study,plan for,and build adequate structures to withstand.That is the only cost I am familiar with,but wonder why the Bradley Lake project cost so much more per mile than this study indicates this intertie will cost? 2.Environmentally Unfeasibilitv:The intertie goes through some of the most scenic country in this state which is accessible without having to fly to.The communities along the road have every right to object to such an eyesore through their backvards.I object to having the same eyesore through the mountains which are an important area to me,both recreationally and as a professional guide.The health concerns of local residents reflect my concerns as I lead groups in and around the proposed route.The disturbances to wildlife,both by the project itself and increased access it will provide,will also ruin the area in myeyes. 3.Reasonable Alternatives:The plan does have alternatives to the intertie which make sense for this state.Petrostar,like Alyeska,should be asked to provide its own power.(It seems ludicrous to me that in N.America's richest petroleum city they cannot do this).Then the conservation alternative ought to be considered in conjunction to the Allison Lake project and/or new diesel generators. I urge you to reject this study and go back to the drawing board.I cannot stress how strongly I feel that an intertie is not wanted or needed. WeYesTwardock HECEIVED25FEB94 Director ;FEB 2 §1994DivisionofEnergy,DCRA 333 W.4th Ave.,#220 DNUSIONOF Eaencycone,Anchorage,AK 99501 I am opposed to the construction of the Sutton to Glennallen Intertie: 1.)The energy demand forecast as described in the feasibility study is not based in reality.If you aregoingtouseahugeincreaseinPetrostar's production as a basis for justifying the intertie,get them to sign a power agreement ahead of time.As it is,the intertie is simply a boondoggle to give Petrostar a savings in theirenergycosts,andit is easy to see why they wouldinvent a last minute scheme to increase the demand-as long as they don't have to be held accountable. 2.)The costs for environmental mitigation and litigation costs are terribly underestimated.This is espe- cially true since I believe all routes cross protected swan breeding areas,as well as the Nelchina Public Use Area,which is the home breedinggrounds for the Nelchina caribou herd -al]50,000 of them.If so,construc- tion would be impossible during the early summer weeks.3.)The Glenn Highway/Matanuska Glacier area has long been recognized as being one of the premier locations for tourist developmentin Alaska.Only in the last year hve access and land ownership problems been worked out so that the potential of the area can be realized.The construction of a powerline that robs the high-way traveler of the incredibly beautiful vistas of the Talkeetma Mountains would be a major disincentive for themajorinvestmentsbeingconsideredforthisarea. 4.)Other alternatives that actually produce power instead of transferring it from one place to another should have precedence if economic and environmental concerns are equal. 5.)Since construction of the intertie will end up costing about $60 million dollars,the cost per rate payerisabout$20,000.For the residential customers who use the electricity for lighting and appliances,this probalyrepresents20yearsworthofelectricbills.Or,put the money in CD's and pay the whole of CVEA's costs from the interest.Only huge industrial users such as Petrostar stand to gain from this project. 6.)The state cannot afford a 36 million dollar boondoggle at this time.The reputation of both the Division of Energy and the Department of Community and Regional Affairs will be on the line as being responsible for this project in the minds of the citizens of Alaska. Charles "Ship "BR.oy 1326 G Street Anchorage,AK 99501 and Mile 102.5 Glenn Hghway Glacier View Alaska 02/24/84 18:21 39072734355 ENSR oor RECEIVE FEB 28 1994 u7 DIVISION OF ENERGY,.sRA February 24,1994 Mr.Rebert E Harris,Director Department of Community and Regional Affairs $33 West 4th Avenue,Suits 220 Anchorage,AK 99501-2341 Dear Mr,Harris: As a taxpaying resident of the state of Alaska,I'm writing to express my outrage over the proposed electric intartia between Sutton and Glennallen.This would impact everyone in the state,in Anchorage,Barrow,Craig,Homer,you name it " At this time of fiscal crisis,this issus is economics. ®How could the state possibly consider providing $70,000,000+for an unnecessary power line when we are scrambling to finance our immediate budget crisis? @ Why should we subsidize a new refinery which was built to supply a bankrupt airline?, @ Why haven't altamatives to this proposal been truly considered? @ Why is this proposal being rammed down our threats without studying the true costs and real environmental impacts? @ Why didn't you have a public meeting In Anchorage for interasted persons? Please reject the proposal as NOT feasible!|don't want my state money being wasted. Thank you for your consideration. Regards,Tone0Acco- James Armstrong 19701 Abbott Loop Road Anchorage,Alaska 99516 The National Outdoor Leadership School *P.O.Box 981,Palmer,Alaska 99645 (907)745-4047 ;HECE WED NOLS ren onecer FEB 25 1994 .AUISION OF eneney ocaq 2-21-94 Herv Hensley,Acting Director Division of Energy,Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,Alaska 99501-2341 Dear Mr.Hensley, The National Outdoor Leadership School would like to express opposition to the preferred alternative of the Sutton to Glennallen/Copper Valley Intertie Feasibility Study. 1)Economic Unfeasibility:The intertie option has costs which have not been included in the draft feasibility study.Economic costs such as lost tourism business activity have not been adequately addressed.The National Outdoor Leadership School (NOLS)offers a number of outdoor education courses in the southern Talkeetna mountain range,location for the proposed Sutton to Glennallen/Copper Valley Intertie.Our 31 day courses begin at the-Glenn Highway and backpackin the Talkeetna Mountains.Our operation spans a 10 year time frame generating revenues of over $300,000 annually and has served hundreds of people from Alaska, outside and foreign countries.The changein the area of the proposedintertiewouldhaveaprofoundeffectonouroperations. Based on the report itself the intertie's economic feasibility depends upon massive increases in the load of a single industrial customer,the Petro Star Refinery.NOLS objects to this project based on the level of pubic expense for this one customer.The Division of Energy's review of the Petro Star expansion must include the prospects for Petro Star generating its own electricity. Any route through the Talkeetna Mountains would contain avalanche potential.No costs of assessing and managing this hazard are addressed. Jim Ratz,Executive Director International Headquarters P.O.Box AA,Lander,Wyoming 82520 (307)332-6973 112 2)Environmental Unfeasibility:The intertie goes through some of the most scenic country in the state which is accessible without having to fly to.The visual impact of this project is objectionable.The impacts of service roads and construction are not adequately addressed in the study.NOLS in particular travels in the area because of its beautiful and pristine character.Many other recreationists and hunters travel into the area for the same reason and because of it's excellent wildlife habitat.The placing of the intertie in this area would significantly damage that experience. 3)Reasonable Alternative:The plan does have alternatives to the intertie that make more sense.Petro Star,like Alyeska,should be asked to provide its own power.The Allison Lake project and/or new diesel generators seem more appropriate and cost effective alternatives to the intertie. We stongly urge you to in good faith to review all of the factors brought out in this public process.From our review of the materials we believe the intertie is not needed and we would like to add our voice to the large number of others who do not want this project to be built.We teach our outdoor leaders that "Prior Planning Prevents Poor Performance”.Spending additional effort and money to thoroughly evaluate the results of the public imput would now be prudent and wise and we believe cost effective.We implore you to take your responsibilities seriously in this analysis. Sincerely, Dn 4 hel Don Ford Director NOLS Alaska .wet '. .: :".-a":at"Valley 'AlaskaCenter for.theEnvironment.-Lakeview Professional Building;Room 203..Mailing Address:P.Q.876161,'Wasilla,Alas 99687 "Phones 376-8223rer)a 7 WESE:,v =D=Poe Sayia are s "FEB "25 1994iHery:Hensiley,-'Reting:DE rector.Coe Ss ."oe en-Div.of"Energy,Dept."Of:'Community and Regional Atfairs ..333 We:4th:Ave.'Suite #220°.rors Coe a Ba"Anichorage,.AK.9950132341 |pe Sea RS ? .aa on "DearMr;'Henst ey,r "7 2 a.,7 ".."ve mS ;an .:.on .:7 i -aoe a .my 2 oo ert7oebeam"writing:"with .'regardto:the proposed -"Sut ton we Glennali enoJintertie.and the.'economic.feasi'bifity.study .which was..done by.R.W.Beck.and Associates.I wish to.'inform you.that as 'the:coordinat orOEthe.Vailey 'Alaska Ceriter of the Environment,and as a homeowner'in.the 'Matanuska Vabley I.'Strong!yy Oppose:the,iatertie for foursa"basic.reasons.os _ee oe ,*ott :.a0prkst:'the.feasibility study:has not acctiratély astimat ed thYe"costs:.of the 'project.:'The-labor costs.are underestimated..The ROW costs/°ou dre:'underestimated.The study failed to even:account forall -the.condemnation proceedings.costs,or:-the 'accompanying legal.posts::"..Public”and 'environmental ."gat ety'was -neglected.AROW -clearances ©."y):veduced from 150 ft.'to -125ft.)in.order to lower the project costs:"cand make the int ie-more °'Viable...The study:also.fails.to take-|"irito.'account,'environmental costs.-a hice.factor:that:in the.past:.has:been eliminated in the:world of economics:Howéver,as 'federal.Superfund expenses,.the Exxon Valdez fiasco,and state'of:the areconomic.feasibilit y.Studies have demonstrated,we 'can,ahd must,teStart|£o account -Eor.the environmental costs.Tp tes Bee"Second:>the 'results are biased towata 'the iktertié Dy.'assuming.animprobable:"moderate-high -or -high':load "growth.scenario'.whichdepends.oh.a-single private '-indust rial:'user.Ther é.are.many holes-..°in.the:-lodd--estimates.-<for!"exampte,there'is no”independent:industry.'analysis -to assess.the:accuracy --of.Petro Star'.S growth”»:¢laims.:Even "the:'president.--of.-the.scompany 'won.'t:stand by "the.outrageously overestimated numbers...Given that:nearly.all)of:.the."kk projected load:.:'growth'.'and hence..economic ijustification of 'the 0"intertie.is based.on Petro Star;and.that-the costs of.the.intertiei-project 'are 'paid for.:with publi dollars,-it.is 'not'.unreasonabie''oo that we:Should.demand 'more'concrete and:detailed 'information.on:.:this matter...>Why:not.éncourage.Or,require Petro 'Startto 'cogeherate,,..net"to.meet:its own electricity demands.".Of Petro Star.Shouid build.,its own,diesel'generators to meét.its.electrical.'demands beyond»7 the:low and:moderate'growth:scenario:Levels (.voy toe "third.-as-a:citizen'of this:state,'T.do."not:believe:that theMirepasagreement":'a $25 million.50”year no-interest:loan-rois.inthe best interest.of the state and.its.people -especially given'the current budget .crisis':.-A no 'interest loan amounts ”to an'additional'$76 million dollar subsidy.The high times aré over for.”_the 'State -"08 "Alaska.-Our.government must -tighten "its:"belt -yon."ridiculous |BREDding |aad start:"operating:ik.a fiscally.responsible.we,-=an Te arian) tanner.State revenues in'jean.'times -'can "not:'Pave."the way:for.2 'cheap:electricity.in rural Alaska'or:for private industry.Porkebarrel,'Poondoggles 'must,be'chopped,. A! Aha Fourth,when:large'scale.development.'is.proposed;ee feel'the °".negative®impacts of:that development 'should.be shouldered by:the.".".gsame community receiving the positive.benefits,'The:benefits:are.©supposedly going to-.all.CVEA,members ,:though.clearly,'Petro:Star.'will benefit 'far above and"beyond _the average'consumer...Yet it.is..°|the quality.of life of:'Matanuska.Valley:'residents and-the valley'Ss....gseente value,that°will;"be:'degraded._;It will.be -the>Valley's.".-economic mainstay,'tourism:and.remote "and semi--remote récreation.|. "(hunting and'guiding);that 'will.be-adversely 'affected.+And it"2 willbe the Valley's natural 'environment'that ,will be'irreparablydamaged."It.is my."hope,that.the ,,Department .of.Community -'and'Regional.Affairs would.not.'even.consider a@ project that is so".clearly.out 'of balance in its.effects'on two distinctive Separate |--rural -communities.1!believe |moreviable,'reasonable,.acceptable.-"alternatives.exists.Loe ..wo coon ao Me.Hensley,I:'encourage you.'to do thé sensible:thing:'look 'close!ly"and critically at..the.Feasibility:'study,and'recognize its major,Shottcomings.'Itis not.an accurate,:reliable document,where:the ,number's |for:the.intertie are:concerned.|;ee aArecommendation6E.'the 'Allison:Laké.hydroelectric projéct or the.'upgrading ©'of .the diesel|'generators 'while leaving 'Petro-Star..Refinery to./cogenéerate'its own electricity.is.the only'sensible,”"3+responsible conclusion.©.".;ce tne 2°dort MecDannord -;2.Valley'CoordinatorValleyAlaska."Center for.'the Environment. , We oeFebruary24,1994 VGewnd FEB 25 1994 Robert E.Norris,Director DMision pe Division of Energy TON GF EREDepartmentofCommunityandRegionalAffairs 333 W.4th Avenue,Suite 220 Anchorage,Alaska 99501-2341 In regards to the Glenallen Intertie,I am vehemently opposed to the intertieespeciallyinlieuofthefeasibilitystudywhichassessestheenvironmentalandsocialimpactsatazerodollarcost.The study has been skewed inCVEA's interests to show the costs of construction is less costly thanalternatives.Lets consider this. Hydroelectric power (Allison Lake)is renewable,clean,and gives the arearequestingthepowertheresponsibilityforproperdevelopment.It could beexpandableasdemandsincrease. The feasibility study does not factor secondary roads to service theintertie,policing the area,wind damage,forest fires,and cost overruns. Look at the Glenallen to Valdez intertie build at approximately $500,000 amile.Also the environmental impacts-eagle habitat and all the wildlifehabitat.How about social impacts;family health due to EMF's,business such as guiding,hunting,snowmachining,fly-in tours,backpackers and river rafters.People come here as tourists because the lower 48 has been devastated by big business demands and the untouched areas are disappearingorgoneexceptinNationalParks. You need to fully investigate what's happening outside.Interties are being moved away from schools because a link exists between EMF's and cancer. Environmental groups and communities are banding together to stop intertie construction and their voices are being heard above those of big business. Settlements are being made to property owners for loss of property values. We live in an age of changing focus from economic gain to conservation of priceless resources.What kind of government and political process can allowthisintertiewithnofactoredcosttosocialorenvironmentalimpact.©Perhaps legislators are more concerned with donations to reelection campaigns than the voice of their constituents.Does our legislature want to be remembered for their disregard of the Great Land and assist big business who will pollute it?Who pays for the repercussions felt in the decades to come. Our children will say their predecessors were short sighted and greedy. MEA and CVEA stated the project would probably not lower cost to the consumer but increase costs to help pay for financing its construction.We have listened to repeated lies to persuade the people to embrace this moronicproject.Who benefits?Petro Star,who sits on one of the biggest fossil fuel deposits in the USA. Then ask yourself,is this so worthy?If so why isn't Alyeska interested? They want nothing to do with the intertie-perhaps an alternative is to get excess electricity from them to help power demands required as demands grow,in addition to Allison Lake and conservation program. Lets look at all alternatives before we waste Railbelt monies on a useless project destined to cost more and more money because the feasibility study is flawed by the methodology used to figure the costs.When these aforementioned costs are appropriately figured alternatives to the intertie will be significantly more feasible and economically superior. Heartfully felt, Vicki L.Kindseth P.O.Box 1200 Chickaloon,Alaska 99674 February 25,1994 Telephone comment received by R.Emerman from Mr.Jim Williams,Valdez: Mr.Williams stated his concern that the proposed intertie would experience cost overruns that would saddle the utility consumers with high debt.He referred to the construction of the Solomon Gulch project and the Valdez-Glennallen transmission line as evidence of the magnitude of cost overruns that could occur. He indicated his preference for the Valdez coal project proposal put forward by Randy Hobbs and Alaska Cogeneration Systems. Telephone comment received by R.Emerman from Kevin O'Toole,Glenn Highway resident: Mr.O'Toole stated that the intertie was an overkill solution to Copper Valley's electrical needs.He is nervous about Copper Valley Electric Association being in charge of final routing decisions,and is concerned that cost considerations will lead them to route the line close to the highway.He is concerned about tourism impact,and believes that the load growth scenarios under which the intertie is justified are unrealistically high. EOE VED Alex Harris FEB 25 1994LaraSoxHC04Box9602DIVISIONOFENERGY/UCRAPalmer,Alaska 99645 February 22,1994 Robert Harris,Director _Div.of EnergyDeptofCommunity and Regional Affairs333W4thAve,Suite 220 | Anchorage,Alaska 99501-2341 Dear Mr.Harris Having read the Draft Feasibility Study for the Sutton-Glennallen Intertie,we must urgeyoutorejectboththelegitimacyofthestudyandtheprojectitself.We found the study wasincomplete,inaccurate and misleading.Incomplete because the potential and inevitableenvironmentalimpactsofthisprojectswerenotincludedintheanalysis.Inaccurate andinconsistentbecausemanycostswhichwouldbeincurredinhighdemandscenarioswere omitted,even though the project only makes sense economically in those high load scenarios.Andmisleadingbecausemanyoftheassumptionsusedtocalculatecostsandbenefitsseemtobeunrealisticandshort-sighted.The study completely ignores the options of Petro Star co-generationanddoesn't site the immense stupidity of sending energy hundreds of miles to the most energy richcommunityinNorthAmerica., We are sympathetic with the CVA's membership's need for low cost electricity.We are notconvincedthattheintertiewillreachthisgoal,or if it does,it will be at the expense of the AlaskataxpayersandthealreadypressuredwildernessbetweenSuttonandGlennallen.As a state,weshouldencourageandsupporteachregiontodevelopresourceswhichareimmediatelyavailable toit.While the immediate costs of developing one of the hydroelectric options may be slightly higherintheshortterm,the long term stability of hydro in the area would outweigh any additional costs(although I think the actual costs will be lower than the under-represented costs of the intertie sincelegal,technical,and environmental costs have been omitted). Please notice that the costs have been underestimated and the need has been exaggerated.We are deeply opposed to this project,and would prefer to spend our time in ways other thanfightingitstrenuously.However,we will fight it unless it dies its overdue death soon. Fib-.22,(9F9¢MmMECEIVED ta hha Lecce reeset FEB 25 1994 DIVISION oF ENERGY/DCRAzaAAL2eO2f5.33 ZA LE Hash EL:te222buchatages$L G4 omfl-ABA 5bedgrnetx,ons AL (fh tr K£Aes D-244 ctadeat nal”ck?Lh Lp Lg etPete WMA Atl CEF Lense tte ld.hae tesd wed Lape tbaall ZVnae#CO3,LB rh PHOSALasts,AE 99645 WECEVEZD FEB 25 1994 DIVISION chee:February 9,1994 OF Blais RA Robert Harris: Division of Energy Department of Community and Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,Alaska 99501-2341 Dear Mr.Harris: Now that the Feasibility Study for the Sutton to Glenallen intertie is available for public review I would like to bring to your attention some critical issues concerning this project. Regardless of the fact that this boondoggle is opposed by the Majority of those affected on the basis of health,environmental. impact and future costs,not savings,to consumers it is also very "unfeasible"in light of Copper Valley Electric Association's own "study"and all the hidden costs incurred.Referring to the Economic Analysis of the Feasibility Study by R.W.Beck and Associates Inc.,you may notice that their summary is:based on an assumed and artificial growth rate of the Copper Valley and especially Valdez.Although it is public knowledge that CVEA tried to manipulate R.W.Beck during this study,they were objective enough to present the fact that diesel generation,followed by Allison Lake Hydro generation were still lower in cost during a normal load growth scenario. But that's not all.If you dig a little deeper you'll learn that 70%of the power generated is to supply Petro Star of Valdez.So, in essence,the State of Alaska is giving away a no-interest loan (35 million)to support private industry with a very marginalgrowthrate.Practically speaking that money couldbe used to fill our budget gap or other more feasible projects.Consider the fact that with a 6%rate of interest,in ten years 35 million could morethandouble. Now let's get down to "real"costs.It's almost ludicrous to accept this intertie project based on 1993 costs.If we include the actual costs beginning construction in 1996,hidden costs such as a SVC system,land acquisition (litigation costs)and even more realistic construction expenses,the total estimated costs of. $45,931,000 will be more like 60-80 million.What this means is we the consumers,will be slapped with a debt burden somewhere down the road. There was a deliberate and obvious lack of intention to objectively analyze and compare cost economics with alternatives during this so-called study.Even the feasibility study itself states thattheirmethodologywasbasedonassumptions. Unfortunately,all the issues at stake cannot be addressed in one letter.I urge you to review all the facts and try to wade through the smokescreen CVEA is using to cover up this "deal."There are some special interests involved here including a few legislators. What we need now is someone with enough wisdom and fiscal responsibility to protect us from this force fed pork.35 million could go a long way towards something more useful than a 135 mile piece of bacon. Sincerely,Prtab-_<b the Mark Bertels P.O.Box 263 Sutton,AK 99674 FEB 25 1994 JULIAN L.MASON III DIVISION OF ENERGY/DCRA 1130 WEsT SIXTH AVENUE,SUITE 100 ANCHORAGE,ALASKA 99501 (907)276-4331 February 23,1994 Mr.Herb Hensley,Acting Director Department of Community and Regional Affairs Division of Energy 333 West Fourth Avenue,Suite 220 Anchorage,Alaska 99501-2341 Dear Mr.Hensley: I oppose the Sutton to Glennallen intertie.The intertie does not make economic sense. Copper Valley Electric has about 3,000 customers.If the construction cost permileisthesameasthecostfortheBradleyLakeline,the cost will be at least $120 million --$40,000 per customer!This cost is enough to pay the average residential bill for 30 years or more.This is not a sound investment of the State's scarce economic development dollars. Very truly yours, JLM:sjw mEGE:+LO PrintedOnRecycledPaper>PN ,ALASKA FEB 2 §1994 WILDLAND DIVISION OF ENERGY/OGRA ADVENTURES 23 February,1994 Herb Hensley,Acting Director Div.Of Energy,Dept.of Comm.and Regional Affairs '333 W.4th Ave,Suite 220 Anch,AK 99501-2341 Dear Mr.Hensley: Our business operates small-group,natural history oriented trips of 7 to 12 days inlengththroughoutsouthcentralAlaska,including areas adjacent to the Glenn Highway neartheproposedrouteoftheSuttontoGlennallenIntertie.We appreciate this opportunity toexpressOuroppositiontotheprojectasitappearsinthedraftstudyandrespectfullyquestiontheeconomicsofconstructingthepowerlineatthistime. 'Being a recreation-based business whose livelihood and longevity depends upon_unhindered vistas,unspoiled wiidlands and the chance of viewing wildlife in a naturalsetting,the suggestion of a powerline running through the Talkeetnas or along the GlennHighwaydisturbsus.We employ 60 seasonal and 12 year around staff who serve nearly 4000Clientseachyear.At least two of our nine different 'safaris'utilize the area affected by the-Intertie.We join with other ecotourism businesses in the Matanuska Valley and nearChickaloon,several of whom we subcontract with,in calling for a reassessment of this expensive and potentially unnecessary power corridor whose environmental effects have seemingly not been fully addressed in the draft study. 'The Glenn epitomizes Alaska to all those who travel its length.From the grand vistasoftheChugachandWrangellstotheautumncolorsattheroad's edge,the highway makes a Statement about the character of our state to all those who arrive by vehicle or who drive theToadoncehere.Many of our guests have reiterated that the Glenn was the most beautiful_section of their trip to Alaska.A large intertie running alongside the highway woulddiminishanddilutethegrandureforthemanyvisitorswhocannotgetintothebackcountry. If the intertie were to cut through the wilderness of the Talkeetnas the results would be even more undesireable for the users who hunt,hike,ski,snowmachine and flightsee,not to mention the environmental consequences of building and maintaining such a corridor.In your feasibility study,road construction impacts appear dismissed.Roads and their subsequent effects to the natural and human environment are far too important to overlook. Po Box 389 Girpwoonp,AK 99587 Direct:907-783-2928 #OursipE ALASKA:800-334-8730 =WITHIN ALASKA:800-478-4100 ®Fax:907-783-2130 We jom with many others in asking the Division,our legistators and the Governor to .reconsider the costs and the benefits of this project at a time when Alaska can ill afford money poorly spent.The $60 million already slated for construction could help relieve huge cuts _ '.facing economically proven programs such as the Alaska Tourism Marketing Council.= -Futhermore,little study has gone toward other more efficient electric supply alternatives like :cogeneration and small-scale hydropower. .We respectfully ask that you further consider the social and environmental impacts of"_.this project,measuring,if possible,the loss of world-class views and sustainable,recreation-based economies the area is dependant upon.Also,look again at whether this projectisnecessarynowandifwearenotsellingotheralternativesshort.Alaska's future demands_accountability by large investment projects whose viabilityis uncertain. Thank you again for this oportunity.We look forward to being keptin touch on theprogressofthisstudy. Sincerely, Chris gton-Evans Program Specialist ¢&Governor Walter Hickel Senator Judy Salo : Representative Mike Navarre me Vew EOFEB251994 REGeLayDIVISIONOFENERGY/DCRA FEB 25 1994 Dear Mr.Hensley The Sutton-Glennallen Intertie has me worried about the health effects of slectromagneticfieldsandtheimpactthathighvoltageiftayhaveénrecreation,wildlife,and the quality of lifeintheunspoiledwildernessalongtheTalkeetnaMountains.The writers of the feasability study have admitted to underestimating the cost of the Intertie at 4g million dollars.This price,in my view,is not worth the benefits of meeting the predicted energy demand of one private company,Petro Star Refinery,who may have the potential for selfor cogeneration.I can not see how such an expenditure will bring a reduction in rates for Copper Valley Residents.I am opposed to the funding and construction of the Sutton-Glennallen Intertie. Sincerely,&hun RenerreCu Ellen Americus Rhu ihm eh: hel cape entsfulsttopaclohe Satie var tm pen sate (sg ml) Fas lod,uaw aD FEB 28 1994 DIVISION OF ENERGY/DCRAKoAseEHargis6.92 194 4 QV)DF Entetey, kapT of Lamm ory Affars 333 WHY Ave,Suite a2 Le Lattee,A)4 CoQ por Coctrn anol thor,2XfNoga 0)Phe STs as Uel\47 CJ 7 SS "O°D ark Ae fk!hie aAasssgh.oe Cuwrber Sissel box God sere Alaske 17674_ FEB 2 8 1994 Dlvision OF ENERGY /Dcpa February 24,1994 To Whom it May Concern: The Sutton to Glennallen Intertie is a poor choice for almost everyone involved.Here are thrée reasons why: First -The people along the Glenn Highway will have this eye sore in their backyards. Second -Petro Star knew how much power they would need to run the refinery before they built it.They knew what power was available, and if they needed more than was available,I'm sure they could have made some plans to take care of the shortage .Building the intertie for their benefit is not practical., Third -The intertie being the least-cost alternative is bologna. We have to look at all costs here.CVEA will have to borrow the money to build the intertie -approximately $76 million.Being a loan,it will have to be paid back.CVEA customers will be the ones who pay for this.Also CVEA will have to buy the power they use from ML &PF,Chugach Blectric or someone else.Again the cost is passed on to CVEA customers.The best plan for CVEA customers is to upgrade their present power plants or construct a new power Plant.This way CVEA does not have to buy the power,they own it. This is the only way CVEA customers will ever receive low cost power. Sincerely, 4 an Ltt pp -<- erle Johnsohfi P.O.BOX 277 Sutton,AK 99674 MAR 4 1994 MARig1 1993 FFICE ONA!AFFAIRS COMMissiuNcK's UCOMMUNITY&REG!me2or22arv_ n:.rayLe4qt mp rerect ifry'{ "YLLIZON ym>otantmytt seomet.a odoa ts wotfatte weQO vr) tb yoy Cover-Up3)cQQ'KVv2.e)a,The Great feck LEn slew 233 a).1 pre énite 220 fire fk Fst "Deer Herbs Hen Slosyfevé_are Lae Pon mon KS A.the Sutton |Glens le.Litertie,hee tithe he,Zs Linen cia be heed 2s sr hle Wy,5 LAL}ASL ita . Looped res'deL)ts snrhas myS2 Ke areO)D2SE/w7)Ske .Rrosect sh.will hurt gonmyfuttsrethors4vik2GYDOWereSHYAGYY lost g ZIT OLE C7 ae AN estimateAOAeLae.,-. Cc) 71 L556 Qe "Dri 2 JASSH/ESS JIS @.KRoa -sdeq 37 Ylase.Sires - Hesse rh Seen pt hens Jet On 9 S06SHisirresponsibleLDWellGd4Rayect.DanksSindevelp A003 BX FiOS Palmer Bk og gus ny /ns 7 a )a -f"Ae .yO -«MES&:vEDTraebey:oaks . ._"Lee a - 1 wht ey t .j s 5 *cen,FEB 2.8 1994 hyoe neded aoe wl”OFS%cetokake - a op . x I on :ed .™ ---«__ .- - { I t ': jH-} -o a alWALTER B.PARKER 3724 CAMPBELL AIRSTRIP ROAD -nGSCEi VED ANCHORAGE,ALASKA 99504 (907)333-5189 FEB 2 8 1994 |Division OF ENERGY/DCRAFebruary25,1994 Herv Hensley Division of Energy 333 West 4th Ave.,Suite 220 Anchorage,AK 99501-2341 Subject:Sutton-Glenallen Intertie Dear Mr.Hensley: The Sutton to Glenallen Intertie does not pass muster on any rational cost/benefit analyses. We should have learned from the Susitna Dam and Rampart Dam experiences that applying1930's Bureau of Reclamation Theology to Alaskan energy problems does:not work.We got little useful for now or the future from the some $400 million poured into Susitna. The Sutton-Glenallen Intertie is only needed to supply power to both Petrostar Refinery and HAARP.Existing needs are being and can be met by existing facilities.Petrostar can supply it's own power cheaper than if it had to carry the true costs of the Intertie.HAARP is probably not going to happen.If it does let the Department of Defense make its own power from the oil going right by it. The population of Valdez and the Copper River Valley would have to increase by 400%in the next 50 years to justify this kind of investment now.This is not going to happen according to current demographic estimates,both state and federal. When I was the Chairman of the Joint Federal/State Land Use Planning Commission for Alaska (1976-79)we did analyses of many proposed dams and interties.None of the large ones were competitive with natural gas or oil.For that matter some of the smaller ones that have been built were not competitive,but that is money over the dam.The primary reason was our small population,which meant that some major user had to be invented to make the project work and this major users,costs were to receive heavy up front subsidies. We went through the same kind of exercises when I was on the staff of the Federal Field Committee for Development Planning in Alaska (1970-71)with the same general results.I reviewed all this as Director of the Alaska Energy Centerin 1980 and our efforts quicklyaimedatdifferentsolutionsforsmallwidelyscatteredpopulations. Herv Hensley Division of Energy Page 2 It makes no economic sense to bring power to the area having access to the greatest existing energy source in Alaska -the Alyeska Pipeline.The difference in cost of generation between natural gas and oil is certainly not enough to justify linking Cook Inlet gas fired power to Valdez where all that oil can be made available incremently if needs rise. Sincerely,bidlecB (E-bc Walter B.Parker Vs PeisDRIPif}meverwwtD FEB 23 4993 MAR 1 1994 .scr iCEDear"M.Adabenyoro,DIVISION OF ENERGY/ocrA 'V &REGIONAL AFFAIRS I am a Sutton resident that strongly opposes the Sutton- Glennallen Intertie.I also own a tourism related business on the Glenn Highway that would be directly affected by this intertie. February 17,1994 I would like to take a few minutes of your time,to share with you the reasons I oppose this intertie. I grew up here in Sutton and now have a family of my own that I intend to raise here in this community.Like any community I have seen changes here over the years.This intertie would have a severe negative change here. The proposed substation would be built in the middle of a highly used trail system.I personally use the trails with many of my friends and relatives for X-country skiing,snow- maching,horse back riding and motorcycling.I certainly would not be doing that with the EMF'S put out by this proposal. This proposed intertie will also go through the middle of two hunting areas used by my family for years.I was told at the public opinion meeting that there was no study done on how this proposed intertie will affect the enviroment or wildlife under it.We have no idea what the EMF'S will do to the moose 'and caribou or what it will do to us eating it.Also what will having more access to these areas do to the herds. My family owns a campground on Granite Creek.In the feasibility study it states that Granite Creek would be one of the places you could see the intertie from the Highway.It would be an extreme shame to clutter the majestic view of Granite Mt.with an ugly intertie.Almost every visitor at our campground is overwhelmed with the beauty here.I don't think looking up at Granite Mt.and soaring bald eagles with a intertie going through will do much for the visitors opinion of our campground or State. With the price of oil going down this state should be very concerned about the tourism dollars.I know I am! As I said before I strongly oppose this project.The reason most people live here is to get away from the things that destroy and mare the natural beautyof our country.I hope you do everything in your power to see that this project does not go through. We're not talking about power for CVEA.We're talking about a way of life that will be gone forever once a project like this is allowed to happen.We're talking about my families future! Sincerely, Doloourer xopypordr Barbara Leppanen Sutton Resident Tourism Business Owner on February 22,1994 Commissioner Blatchford Department of Community and Regional Affairs P.O.Box 112100 Juneau,AK 99811-2100 mou TY jRe:Sutton-Glennallen Intertie MAR )1994 DIVISION OF piscine,ewRA Dear Commissioner Blatchford,.we In the brief period of time residents have had to study a plan that spent months in planning and revision stages,many flaws and shortcomings have come to light., Two of the most glaring areas of concern are the projected costs andprojectedloaddemand.- Several aspects of the cost estimates bear scrutiny,from hourly labor costs to costs of acquisition for ROW,especially across native lands.The Bradley Lake Transmission Line cost twice as much per mile as the Intertie is estimated for a similar project.Add the completely ignored five million dollar expense that would have to be incurred within five years for a Static Var Compensator necessary for the line to handle the increased load,and all Intertie scenarios become economically unfeasible.: Along with increased costs eroding the feasibility of the Intertie, the load requirements must also be addressed.Only the high and medium-high load scenarios justify the Intertie.The projected load was based on Petro Star's own unsupported predictions for future growth,in turn based on the assumption of a natural gas pipeline.The pipeline provides another opportunity to meet fuel requirements at the source,and still leaves the question of why Petro Star does not co-generate their own power as other refineries do. The Study determined that the Intertie is conditionally feasible from the standpoint of its impact on the Railbelt systems based on light load conditions.The economic feasibility is based on high-load assumptions.;Already,power outages are frequent in the Railbelt Grid communities.Plugging a 135-mile extension cord into an already less than reliable system is a bad idea.Valdez has easy access to more fossil fuel that anywhere in the |U.S.Extension cords are the least efficient means of transferring electricity. Seventy percent of the load requirement for the Copper Valley is in Valdez. Economically,environmentally and for better control of their own power, it should be produced in Valdez. No economic consideration was given to the communities adversely affected by the Intertie.The designated corridor is a popular area easily accessibletorecreationalusersfromAnchorage,the largest population center in Alaska. No public meetings were held in Anchorage to obtain comment concerning the Intertie.Considering the cost of the project and the impact on the area,this concerns all Alaskans.The Intertie is a wasteful and unnecessary way for the State to spend $60 million ---a $35 million interest-free loan plus $25 million made available by the legislature as AIDA revenue bonds.The $35 million interest-free loan itself will cost the State an additional $76 million it will lose by not charging a nominal 6%interest over the 50-year life of the loan,apparently to reduce power costs to a facility that is capable of creating its own power. Sutton-Glennallen Intertie,Page 2 Beyond the economic unfeasibility of this plan,the environmental impact on our communities and way of life is highly ignored and underestimated. .As previously mentioned,this is a playground accessible to a large percentage of the Alaska population,not just the local residents.The power companies can play down the effects of EMF's,but independent studies contradict the power companies.The EMF's can affect the entire food chain,cancers beingthemostobvioussymgtom.Please do not discount the effect on plants,animals and people.This proposed line is in our backyard. Funding for the Intertie should be withdrawn immediately.The State can certainly use the money towards making up the budget shortfall.Further -investigation of the real needs of CVEA reveal there are more practical sources of energy closer to home. Sincerely, KD Marlo "Red"Morton Mtwhile MatonMicheleMorton P.O.Box 1251 Chickaloon,AK 99674 VERONICA SLAJER eee ue P.O.Box 101293,ANCHORAGE,AK 99510 mevE.WED WORK PHONE:272-3034 ©HOME PHONE:274-9974 MAR 1 1994 DIVISION OF ENERGY/DCRA February 25,1994 Herv Hensley Acting Director,Division of Energy Department of Community and Regional Affairs 333 West Fourth Avenue,Suite 220 .Anchorage,Alaska 99501 Dear Mr.Hensley: As a lifelong Alaskan,I'm concemed about Alaska's financial future and feel we needtoavoidspendingstatemoneyonmorecapitalprojectswithoutadequateassurances of viability.|believe all state-funded projects need to be based on conservative growth and demand projections,especially with state revenues dropping in the future. The recently released draft Copper Valley Intertie Study has its demand alternatives skewed to inappropriately high levels.Substantial growth in the Petro Star refinery load over the next 50 years should only be represented in the highest-case alternatives,as their source of raw material is the same declining oil resource. The alternative of the Allison Lake project needs to be further investigated.It would produce clean energy with much less impact on the residents of the Copper Valleyregion.It would be a relatively affordable project more likely to meet the realisticenergydemandsoftheregion.Residents of the Copper Valley area want more affordable electricity;they don't care which project it comes from.The political support generated for the Copper Valley Intertie is based on the misperception that the funding will be lost if the intertie isn't built.Of course,the money could be reappropriated tothemostcost-efficient alternative. |hope you will remain diligent in pursuing the most cost-effective alternative to achieving our state's energy goals.Thank you for considering my comments in your final report. Sincerely, eronica Slajer cc:Honorable Walter J.Hickel,Governor of Alaska Honorable Edgar Blatchford,Commissioner,DCRA Honorable Cynthia Toohey,Representative,Alaska State Legislature Honorable Loren Leman,Senator,Alaska State Legislature aESE.eED February 28,1994 MAR3 1994Robert£.Harris . -DiVisDivisionofEnergyIMISION OF ENERGY/DcRA Department of Community and Regional Affairs 333 'W.4th Averug,Suite 226wa Anchorage,AK 99501-2341 re:Proposed Sutton to Glennallen intertie Gear Sir: |do not want the intertie to be built,for it would ruin our environment and cost tac much to build.The prooosed path of the Intertie would run. through scenic country.Hunting would be affected by the Intertie becausetheMelchinacaribouherdandlargenumbersofdallsheepinhabitthe route of the proposed Intertie.The intertie may be seen from the Glenn Highway and might cause tourism along the highway to decline.Access roads to the Intertie would also cause destruction of the environment. The eartest the construction of the Intertie could begin would 6 e 1995,The feaasibilitystudy says the Intertie would cost $45.9 million in 1993 dollars.Bue to inflation the costs could rise in the next few uears. 4130,some people feel the construction costs are underpriced.The estimated costs of the Intertie is $250,060 per mile.On the Kenai aPeninsulathereisanelectriclinecalledthe Bradley Lake Transmission Line,It cost twice as much per mile ta build.Considering the rugged terrain along the Talkeetna Mis.,,how can the CVEA intertie be built that cheaply?The huge helicopters that would be needed to haul equipment and materials cost from $3,000 to $7,560 per hour.Sorne people think that CVEA electrical rates would drop in cost once the Intertie is built. There is mo guarantee that the electrical rates will drop.Rates for MEA customers are dramatically increasing. The reason CVEA is proposing the Intertie is that Petra Star Refinery wants CVEA to provide power ta it.Petro Star Refinery will only be around as lang as there if fuel ta refine.[f of]runs out on the North Slope,Petro Star would have to shut down.There might not be a large business in the Copper Valley area that can use the power Flowing hrough the Intertie. an alternative is to build @ hudroelectric project in the Valdez area. This project would havea positive economic impact and the anvirohmental impact would be minimal compared to the impact caused by an intertie.Petro Star refines oi]into jet fuel,30 Fetra Star should produce its own energy using ail. i do not think this project is economically or environmentally feasible and would ruin ceople's lives and livelihood frorn Sutton to Glennallen.[|hope the intertie is not constructed and the idea is never thought of again Sutton School Fifth Grader P.O.Box 245 Sutton,4K.SSE74 riEGEivoD MAR 4 1994 | -"poeck Leow ke an_uNnuise USE.of veroment FUNCS Gnd:CO.fuhue S OM aw_...populechor>dat Wald $a ourACONOMWUCSe.ANd Put ADMecesSALR2SS_ON OW.€Nouanrrrarsé -|=e wala UWGAtO.aCIa GISo WagWOR1SWCFOnepeconDretilted2AOE.HIS WhO Suppots Ch!;"UL fOr.or Yur G(anceIi -MARIG2 1993-)1} riceCOMMUNTIYéREGIONAAFFAIRSaiehoatinOssac.OFQordocsSAshuctorss_Inulingse &SNeross SHOU Yet er o- MAR 4 1994 DERE wisp MAR101 1993 COW SOTAMRAAL&REG Commissioner Edgar Blatchford Department of Community and Regional AffairgyP.O.Box 112100 Juneau,AK.99811-2100 WAL EAD Dear Commissioner Blatchford, I am writing in regards to the proposed Sutton-Glennallen Intertie.This is my first time being so involved in something like this,and frankly I am appalled. I think the State of Alaska should take this 35 millon dollars and use it to start replacing the 900 million dollars you're scrambling to find. I've lived in Alaska for more than 30 years and I've seen more than enough boondoggles to last a lifetime,the Seward Grain Terminal,the Point McKenzie Dairy Farms,etc.,etc.,etc. Everything concerning this intertie seems devious to me.Why is the overall estimated costs per mile of this line $254,000,when the Bradley Lake line cost twice as much at $505,000 per mile,not including the right of way clearing. What about the legal costs that will be encountered in obtaining an easement to cross native lands?I see no mention of this in the study. Why should the ailing economy of our State assume the burden of a 35 million loan for 50 years at no interest?The citizens of our State cannot afford to subsidize an oil refinery in light of the 2.2 billion dollar shortfall. This project is obviously destined to incur millions,and possibly even billions of dollars in cost overruns if allowed to be built. ) You are not listening to the citizens of this state now,just like you hardly ever have in the past.Only the power brokers and lobbyists for special interests seem to have any influence,and they certainly know what strings to pull! How many generations does this wasteful,disrespectful of nature attitude have to go on before people will begin to have some good regard for the environment?Until there is nowhere left to ruin? Please,listen to your conscience,your inner voice,see the big picture,the past,the present,the future.Not the narrow,. short-sighted,tunnel vision that seems to be affecting so many of the politicians of today. Respectfully yours, It plee_> Sharon McEntee -0:BoxSuTtor,'ae:11674 nevervbO FEB 25 1994 P.O.Box 240343 Anchorage,Alaska 99524 DIVISION OF ENERGY/ODCRA February 25,1994 Mr.Herv Hensley Acting Director Division of Energy Department of Community &Regional Affairs 333 W.4th Avenue,Suite 220 Anchorage,Alaska 99501-2341 Dear Mr.Hensley: The draft feasibility study of Copper Valley ElectricAssociation's future energy needs contains some important pointstoconsider.; The study shows a possible reason for an Intertie eletrical powerline from Sutton to Glennallen only if the Petro StarRefineryinValdezmorethandoublesitscurrentworkload.There is no proof or even a cause to believe that Petro Star.will ever need to increase its load by such an amount.If they do see thatneedinthefuture,there are other possible solutions to theirpowerneeds,including:seeking electricity from AlyeskaPipeline,producing their own power from waste heat,or some other alternative energy generation,such as a wind generator. The idea of building a disruptive powerline (the Intertie) through the Talkeetna/Chugach Mountains at the cost of $40+ Million,in order to support an unforeseen need for power sounds like an incredible waste of money by the State of Alaska. Those who live in the region served by Copper Valley Electric Association deserve to have the lowest possible cost of energy.Since their power needs will likely increase slowly over the coming years,the alternatives discussed in the study to build a hydroelectric project at Allison Lake and/or purchase more efficient diesel generators seem to be the more cost- effective and reasonable solutions.Either or both of these power sources will likely result in much lower future costs of energy to CVEA consumers than the very expensive Intertie project. Serious problems in how the study was done include: 1.The assumption that Petro Star will be operating through the year 2047,when current plans for the Pipeline end some 30 years prior; page 2 2.The extremely low labor cost estimates for constructingtheIntertie,especially when most of the work would be done with helicopters; 3.The underestimated cost per acre of right-of-wayacquisitionfortheIntertie; 4.The low figure for legal costs for obtaining right-of- ways; . 5.The elimination of the estimated cost of a $5-$6 Million Static Var Compensator,which CVEA consumers will be required to purchase shortly after completion oftheIntertie;and 6.The lack of information regarding more efficient diesel generators for CVEA.; It is clear that building an Intertie from Sutton to Glennallen will only cause a financial burden to CVEA consumers . and to the State of Alaska.I urge you to recommend the Intertie idea be canceled and that the more cost-effective alternatives for future power needs in the Copper Valley be given the highestattention. Michael V.Coumbe " copy to: Edgar Blatchford,Commissioner Dept.of Community &Regional Affairs AESE:VED Robert E.Harris,Director Division of Energy,Dept.of CRA MAR 4 1994 333 W.4th Ave.Suite 220 DISAnchorage,AK 99501-2341 ION OF ENERGY/DGRA February 26,1994 Dear Mr.Harris; I am responding to the draft of the Sutton to Glennallen CVA Intertie study.I do recognize that the comment period ended on February 25 but I just received the latest information on the project.I am attending the University of Arizona for spring semester to finish up my graduate degree and will be returning to Alaska middle of May. I still wanted to take the opportunity to respond to this project.I am very concerned with this project even reaching this stage in the GAME,considering the economy in Alaska.This is entirely a pork project between the upper levels of State Government and the private sector,Petro Star,and interest groups,such as the IBEW.I truly thought Alaska was breaking the sub government stigma,but this project is proof it is only promoting it.- Other private corporations have been responsible to provide their own resources for acquiring power.Green Creek on Admiralty Island,Alyeska,INC,in Valdez.I find it rather suspicious that the State of Alaska is providing special treatment for this company and EXPECTING the people of Alaska to provide the funds. This project will not only benefit only a particular few interest groups,it will take the benefits away from many.We should be proud of our state to be one of the FEW left in the United States that can offer scenery,clean air,peacefulness,beauty,and feeling of uniqueness.We have a gold mine in those areas which is obvious in the amount of tourists coming to our state each year.Why do we continue to fight upper management to have an ecosystem that is not only providing income,but sustainability through our uniqueness! I have been living in Tucson for only a short time,but I can not wait to get home to Sutton.The people,noise,crime,and general congestion of the southwest can never compare to the values that I have at home in Alaska.Unfortunately,those values are being raped in the name of a profit for Petro Star and a SELECT few. -This project is not only economically a disaster,but it is an environmental nightmare! The most beautiful area of the entire state,the Talkeetnas,will be tattooed forever. The largest moose concentration is in the area where the line is laid.Two natural mineral licks,which are few in the state,are in the vicinity.Moose rely on these licks during the entire year,especially in the winter.The road access will open this area up to an over concentration of off road vehicles.The line will cross hundreds of acres of wetlands which store snow melt water in the late spring;beaver,trout,sandhill swans, Canada geese,and many raptors,including the goshawk,rely on this water storage for food,nesting,and resting cover.Grizzlies can move without fear throughout this area. An increase in traffic will no doubt cause endless confrontations which will result in many bear being killed. I truly don't think that government officials have any sense on what they actually have in Alaska's wilderness!I have traveled throughout the world and there are becoming fewer and fewer places in which pristine wilderness can be found.- The government of Alaska needs to take a stand to major development pork projects. Current policy is moving towards ecosystem management but noone knows how to implement it.Alaska has the chance to still make this management work because WE still have REAL ecosystems!There are better alternatives than the Intertie Project.I would suggest you go anywhere in the United States to try and find what we Alaskans have in beauty and in peace.Our wilderness is our gold mine.Not another boondoggle,pork project schemed up between upper sub government and private interest groups! 'This project needs to be stopped.It is about time someone takes a stand to government waste.Please try. Sincerely,(dblle obamachelleSchuman, Environmental Scientist nECeivED MAR 4 1994 DIVISION OF ENERGY/DCRA hy +8RegioDASolARGSa 7oposal)"inkerheeg Sth.a -LieGeomopposal.bo R becneseote™tws |fe Po prosal..ok Ae |moot lees!haben <.hk x fro .of,aod Eve.Se prec2es.coeayerpebsRohebach"keepanSyDIhevaliDacean -et \,ee Served hebfe2pn MM.Awhoo.See.net the -a eparks to..Shy os me ht ee es °;Tradralpho%SAM ath,$3333 Heb ete eat con,this "pet poetatOS.(toner On TayLpage.CLopno mc.Senger,bdo nck daange obsk|;Bay -_Meskss Gateshe -che "Lo pat aa "eleclardh ,osbeicant bh Solar fowls,-AeConsete 7 cen 43 1 |7ehfozen.on a2)Og Jey Neartey|Clonal At 99593 Pras -GbveivoD F P.O.Box 875 EB 28 1994 Anchorage,Alaska QBAASION oF ENERGY/OCRA(907)273-5506 February 25,1994 Robert E.Harris,Director Division of Energy Department of Community and Regional Affairs 33 West Fourth Avenue,Suite 220 Anchorage,Alaska 99501 Re:Comments on the Draft Feasibility Study for the Proposed Sutton to Glennallen Power Intertie Dear Mr.Harris: Thank you for the opportunity to submit the following comments on the Draft Feasibility Study for the proposed Sutton to Glennallen intertie.Although the study itself is quite voluminous and suffers from many defects,these comments must necessarily be brief as a result of your Department's failure to provide adequate notice and opportunity to comment to me and the rest of the general public in Alaska.Several specific flaws of the study and current process are outlined below;however I request that any additional comments that I am able to make from a more thorough reading of the Study be considered by you and your Department and that they become part of the record in this matter. The Draft Study Has Been Prepared Without Adequate Notice and Opportunity for PublicComment Although your Department has purported to comply with the minimum legal requirements in publishing the Draft Study,in practice you have made it impossible for meaningful comment to be made by all of those who have an interest in the project.The Draft Study is a voluminous document,over 1,000 pages in all,with a large amount of technical information.It has taken over one year to complete its preparation.Yet the public has been given merely thirty days to digest this information and assess all of the potential effects on nit just the Matanuska Valley,but on the rest of Alaska as well.Such a shortcommentperiodiisespeciallyegregiousconsideringtheenormityofthisProjectanditsresultingsocio-economic,environmental,and fiscal impacts. In addition,you have made it especially difficult for the citizens of Alaska to gain access to the Draft Study.Requiring individuals to pay between $30 and $50 per copy is outrageous.In doing so you have insured that only a limited number of people have had thorough access to the Draft.It is not enough to simply place copies in selected public Draft Feasibility Study Comments February 25,1994 Page 2 libraries.A large number of the people that will be significantly affected should the intertie be built live in rural areas that make it an inconvenience,at best,for them to spend long hours over this document at your appointed place of viewing.When their only alternative is to pay a large fee to exercise their right to view a public document,you have presented no real choice at all for access.Considering the more than $400,000 spent in the completion of the Draft,it is unconscionable that you would exact such a toll on the public. I am among the public that has had to travel to a public library in order to make sense of the Draft Study in such a short amount of time.Although these comments are the results of my general impressions of the Draft,more time is necessary to comment in a meaningful way.Therefore,I request that you consider,as part of the record,any supplement to these comments that I submit within a reasonable time. The Primary Benefits Have Been Improperly Assumed For the intertie to be logically feasible at all,the future energy demands of the Petro Star refinery must increase dramatically.Yet the Draft Study fails to determine if this will indeed be the case.Such a benefit cannot simply be assumed as the rosiest scenario that some would prefer to see.It must be an objective probability that it will occur.As long as that is not the case,the final Study may not depend on Petro Star's vague hints at future expansion to boost CVEA's load forecast.Impacts To Property Values Have Been Ignored The Draft Study completely fails to consider the costs that will result from the impacts to property values that will be imposed by the intertie.Although most of the potential routes for the transmission line will cross public land,the value of adjacent and nearby private lands will be impacted negatively.Not only will the overall worth of such property decrease,the public itself will be directly liable for such a decrease through the inverse condemnation proceedings that will result against the State.This cost must also be considered in the overall feasibility of the intertie., The Social Costs of the Project Have Not Been Considered The Draft Study does not consider the social costs of the proposed intertie.This failure,if unremedied,will result in an erroneous determination on your part,since the social costs of the project must necessarily be weighted on the cost side when determining feasibility. The Draft Study Ignores Significant Potential Impacts on Tourism The Draft Study brushes aside the potential impacts on tourism related businesses as"likely to be minimal."Yet,a large number of businesses in the Matanuska Valley haveincreasinglyreliedontourisminrecentyears,and their numbers are growing.This is no Draft Feasibility Study Comments February 25,1994 Page 3 surprise,since the Valley is an ideal recreational destination for both out-of-state tourists as well as Anchorage residents.The major reason for this is that the Valley remains an unspoiled and natural area of Alaska.The presence of a large power intertie would significantly change the character of the Matanuska Valley and lead to a decline in tourism- related activities.Indeed,the Draft notes that the intertie will have a "significant impact"on"scenic and recreational resources"in the Valley.The Study must take these negative effects into account to determine the project's feasibility. Costs From Impacts On Wildlife and the Environment Have Not Been Considered Although the Draft Study fails miserably to adequately consider resulting environmental impacts,there are significant costs associated with them.Yet the Draft rather cavalierly assumes that there will be no cost from such adverse effects.To simply fail to consider a profound and certain impact and subsequently assign no cost value to that impact is arbitrary and capricious.In addition,it is certain that significant costs will be incurred as a result of further environmental study and mitigation.This must also be factored into thefeasibilityanalysis. Thank you again for your consideration of these comments.Clearly,even absent the significant considerations mentioned above,the Draft Study reveals that the proposed Sutton - to Glennallen intertie is not economically feasible.Therefore,the Department of Community and Regional Affairs must make a determination that the proposal is not feasible,and save the citizens of Alaska the overwhelming cost of providing a limited additional convenience to very few people. Sincerely, Stephen Koteff - DERA Comrise'e Es || 'sSienec ALS,ho,Box \W2\oo S**"feckVoneay,Rlaska,cf al lj _ JAN-19-1993 ---- DY.ct Si c COMI .WHODTUNETN OC oe TIOWhile. Lead ing mi LOE EI Ee6therday(¢2gpec Rives County Netad\)Came. ---KCLOSS le dee aest Se _nesehive -flecks ek _ave -erogesed_Seen.Gleana\len.eleckoe os--Power _takesWiee oe.wa wat ew to know Gen...against._=+a _also Weve been.desheayiag.rhe -glaaetGonSOlos,most...of os cruak.Ns the ___-2als ety to \ive i Lets ty eo __eveahe-GQ NED Common ty F__o4__C&G ion thet isuvt tore of___.the 'same Ae ent you GE.t.je boca to tls -the ,sheeun rol ler witate (4,2 aL.4leays hive -been > 7 h "nx-tar__yoer fine st deed.yortookLh, S ia ew ly Haryy A Mechattty3 'ty )Roehors VOBIK BIS CofteR CEWrTER Bk GGs73s "vey Dear Commissioner Blatchfort4R!1994Division |I am opposed to the construction ERGVynangSuttontoGlenallenintertiedecease: Name:fam Sox Address?yp 54 Box 9907 |Pulmec AK 9904 REC Even MAR 1 1994 I am opposed to the construct¥teopf,theSuttontoGlenallenintertiebecause:PpaMakesposaneeconomecall)orENUrConnmvatalky,Please oppose ct! Name:hex Haeris Address:HCO Rox W707 Dear Commissioner Blatchford: :This IS a ver mESGeveoD Dear Commissioner Blatchford:MAR 4 1994 I am opposed to the construcli@HWN OTeiEtay/ncaSuttontoGlenallenintertiebecause:of TRE GNS/GHTLYBESS I(T aoucn BLIGETO THLSPRESTINE,ENVIROMEST.CE ALL.60 NORTH To REAK+tu5d vitw T Ale VOLVEDTfovead).aese Tite Oe Pens ees oe PEOPLE, .OL IMACSLIVINGNEAk &y,PO.86X M166. ANCHORAGE,Ab ogy 1608 last To Bt A VAULY pessoas Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie.-because:fraqiic beaut4 fulV Scenic.brodseThisintertiewouldbeanatesore,bout the hounct indushName:ames Roberts Address:.2605 Arebic Blvd.HaeseAnchorageAlaska94503nbc*LO MAR 4 4994 DIVISION og ENERGY/DCRA es Dear Commissioner Blatchford: I am opposed te the construction of theEpputtoto§nallen interysEle only ber ;Bo fe dn in BLES Ss,gt Llores LES Bisse}BemsWwW.AMDERSEN -Dear Commissioner Blatchford: I am opposed to the construction of theSuttontoSeeAonepatemerepetaintsPitasyY,w,YaladBooksBedaeatllestADE:easireSerenearinpsEGEWEDBox924VAR4vsemeeeON,334 MAR 4 1994SUT7TORNIK.DIVISION OF ENERGY)UGRA SUNTON AK oma wor99674AG674TedsMSBINjoTedOnkuroinINS=HM Dear Commissioner Blatchford: I am opposed to the construction of theSuttontoGlenallenintertie-because:the Use ard thy wmpe an Ce)Sark and widlje Name:er Mate-nage,CA.99501sECEWWED MAR 4 1994 DIVISION OF ENERGY /DCRA Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: NECEIyeEhavlesLhdsesMAR2i94378%Mark PSION OF ERGY poyWasillaAK79657 Name: Dear Commissioner Blatchford: I am opposed to the construction of theMichtoGlenalLotebecause:Tf 5 aeeeCLLeer)Bleek*Prid Ri s6nW AG.Hic if PAE VIEL AGS*He OfBax IPOStolen,Nasta Wb¢S- Dear Commissioner Blatchford: I am opposed to the construction of the-Sutton to Glenallen intertie because: Tr dawreges the Environment,Te ! alse frespasses on Native Lands. Name:George ON OUL4 Sr, Address:?P-9.Box CTOT%E CHuGiak AR 97507 Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: vd tame ts Masta.fo enjoy Hu beadscrpe etd ad sauadinezeteyMidonlwantwebieLeaettName:2 the wanton Bi.Mgh..Anite.heewedoAddress:sag Hilleeest Dans Anchorage,AK 94514 Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: iNL BEVEVE THE DAMAGE TO THE ENVIRONMENT Is Nor WORTH THE "So-cacep”ereney Bost WT WR MAKE AVAILABLE.tAinnTHEIMeaneTe8eovName:+®"rw OlEIcle fW/FIp MARIQ4 1993*Anrwony StAueNqeWw."75%Ave,#3 ANCHORAGE,AK COMMIdoIUNLA S OrrilieSSEMUNITY&REGIONAL AFFAIR! i. Dear Commissioner Blatchford:Cay I am opposed to "the construction 'of -theSuttontoGlenallien,intertie because:neeckto,put $400 milton back fovea .@ J 'Sane Beahdee Boe)s @ he Sage Clan.Guide +teadas)&Velching 5€aeof Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: TH+makes no Economie or EcologiesSense.I+is BAD +STuerd loon-&Thump Sys weyName:Gary Heccisen Ley. Address:Box I1OS Mere ase AgeernepMAR1041993 COMMis.;teCouiuny&REGriv "AeFons Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because:W's Seo Aernotanure_alliinelind Boeercec /'"Yalldagg H's «a beon waeName:Helen Weedodi ngs Address:211 S.Baile falmen AK.99645 Dear Commissioner Blatchford: I am opposed to the constructionof theSuttontoGlenallenIntertiebecause: Names 7aym SUCHE Address:yycy d/.FE -MM.ANCHOCAG E;Sooo 'UNFEAS IBLE THIS ANS|GNIGIS .®" Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: FEASABILTK STVOK NAD Previn #7 Base aA\\Name:Jere Anna)ee*NW »093Address:Box 124 FEBS ow,Aik,wens'awsvtteNscoumwreciow Dear Commissioner Blatchford: I am opposed to the construction of the | Sutton to Glenallen intertie because:' ot emo TeSeorek &Acvelop mete 'sweol\elect real enerodion \orks \nNaat?(ies 8S etree Nee thesNN|Address:Gon Ky RhiekoloonAK aay ex eleetics Shox caress Ye choke |\peolts skedies choukd ges Ake MeeeCx05$ Countre \YOO Bow Hobed &Havens Dear Mw.thes:OF ENERGY/DCRAI'm concerned about the stares beset crisis.The Sutton-Glennallen Intertie is a wasteful and unnecessary way for the State to spend $60 million.Please cut this project as a first step toward responsible State spending.Thank you. RECEIVED FEB 25 1994 Sincerely,a4 wu Jettmor a WH IAS eats Ren hoped Plann, loysITdae isalvenhed Srenehid Yok Gogg.i Ate Hna waherhe,Sirol'tag,Sout DOM Comirmnd Over oor irreMNbane&e ra.Reale,sok nwtGeenOffer.an So rman.;Wage,Oly,Nesey,Sse wend:W ¢ Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie -because:DeveWolter,Rebidanks and ode robeswhe,:oy«DB Sead Dna whivence whe Conselten'd {wr55SSQQUANDNaeCneragenteiteLvmpnetnchSind.mh CleName:Sots oe ete mash Seee Ban AleckQharcedesofthaVallth.Me Neartonctsmme,Vine WAL chery tePeaireNocalCathteeSAON868ndNENAS\(ex ants wos Weee te ei ona ing rein ofAhadlactroSahaSargaSestesofoteaor,Cir hame,saclinThepam ara VingwmaGallen,OF)QU End le Seeds Teen A oes oe 'epi,Foeropieai)memes ise oS eed chem,ke Cok SX conged+atAgereYoYasthereaenoun4h.skid,fh Su ht”Patten,Sudva laterdttlen)welley Thadange,Putde ee eon Te an hemayBe'1728 O08 John Fe)Trees W704 HV.6,07 OF "Daddy Meer, Son emennedl abe?Lhe dt bedyd creatThedriblonbbrable pg aa foe!Lhe Z j ae tel fil.td eemrtemtiry 9 aenblerr lewtt cet Fei RECEIVED FEB 15 1994 J Aorhe pore,DIVISION OF ENERGY /DCRA Jt/.LinePOpotenFae99S om riley EQCIC479910/2,PA BEX ary Surren Ale 99676DearCommissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen iIntertie because: E Think war.ferrveStay 1S 2 Smoke Screen,Ye real regsem for 42S Iawrestie 1S.HAARL Wo rneugh?IS Zien ro rhe enviromen?or any of USwhoFresaserietreg,ZH Wash;:°Baa!fers ay for /7 Qoe eee om misco.y ie .Poe:Ol tY 8 OF Anion habe os seedhake ;7 9ree Dlready wrueled ul bYhwerliwesandrheCiteline,Why Teay af abeaurjtulPristiwewillevnessa7e3whenorher?:ofrions are auellable a24¢er Jewer Costs,The lioml sTredy dees wor Shaw The real ces7s of a»Imtorzia,IT A Jeep awerver Parr oF whe : Swe Screeyw,i Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because:for HEALtnH Reasows cf my CArLDRENW wedGRADChiLOhenwwhoAiVeswSuTToVefETROSTARCANOSEAWTHERMLIARVATIVE,| Address:94 /20a7'4 S#OTE-ores_aaer cons AOE INE)IN FEB 24 1993 COMMISSIUNER'S UFFICEZOMM Dear.'Commissioner Blatchford: I am opposed to the construction of theSuttontoGlenallenintertiebecause:*%¢ces%s fer Cucsteachen oll be rniach gheahr phan He lys.9williagMereollbo"fige teal MU pha pe sole ot MaskewnfleadupPPGMGPorwt,Name:Craig BaerAddress:Bor 245Sutton,AK 29674 Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: name:Heec Boy 2Address:HC_-o3 Bec pzco Pam eR,Nasa9964S Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because:GnLaas,shdy 5)nok Sup ec «Bre in 8,ed vont L enessh Magee ur fe mnie shatPekrolSkeorcUERWSays.Also with declining oct Address:*>with we bulset 2 Coshich mass (ers basinas fer P tee) CHS,Alaskens Cennet offord hos boondessle Bose Boy 12 Ak 99674 NosP.0.1Sulton, Dedr Commissioner Blatchford: I-am opposed to the construction of theSuttontoGlenallenintertiebecause:/77 /<3SnrVOLTFEARS!BLE ORS.THE COST PFQUIEZLTED / Name:(AVA CLES HUAN SOR. Address!Boyveo/ SUTTON,ALASKAFICE Dear Commissioner Blatchford: 'Iam opposed to the construction of the Sutton to Glenalien intertie because: Name:James 7afley Address:BOX 75 falmer AK VIVES Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: Name:-SOuIA Clana &.2905 AW S00 StAddress:Site (01Anchorage',A.99503 Dear Commissioner Blatchford:"Ec =;vEDIamopposedtotheconstructidfARottg,Sutton to Glenallen intertie%: Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: Ut world Alverhy clamoage theCAAPEOEH8odversl?ofieerrA)voter J LnenaaceomyoystenOly,y3SvzanneBarnar 'Po Box 5S_Duten,AK,WPL IY Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because: THIS AM EPs PREC Ther wee <Ae Carp CeQsgveR.THE Schite VAHLormutCaeMusTBEPhovtorge-7 Accew £.Marsrino anAddress:HCO¢Bos 7628 °° Pacmet,Ak.996ES OllyKANenapshh rr2 .Dear Commissioner:BRtchford:[+"-"ee \I am opposed to the construction of the - Sutton to Glenallen intertie because:: Address:\>\2|Tenge nrArch.Ae 445018 Dear Commissioner Blatchford: I am opposed to the construction of theSuttontoGlenallenintertiebecause: nor COT BFFUINVE -MantehleColtsAteUNLEPOLTESeet(LagerAddress?)Ok MANOR ANCHO CAbE FGex0/ Dear Commissioner Blatchford: I am opposed to the construction of the G i j if b :.D Sutton 0 ete 4:rt ecause . ran bete State pe renistee thar2)pend Lf hesuAant,Name:4,LDecd Address:37 Ductten,AK 94674 3)Vere Concasnacl)abeut EMF'. Dear Commissioner Biatchford: I am opposed to the.construction of theSuttontoGlenallenintertiebecause:/ie ae ee Buy,Aaa arkx lor Address:"PO Boy B4Q :Surin,AK Gqu74 Weis will destvoy He Ihurng hebidetofHeanimalsCrecalvingaven4Dallshea,Dear Commissioner |Blatchford:pore «ete ) I am opposed to the construction of the Sutton to Glenallen intertie because: atheVetutadve.ae hen,te /,'/Name:Karen Sarre -- Dear Commissioner Blatchford: I am opposed to the construction of theSuttontoGlenallen,intertie -beesuse:7o% MO LensoNS THAT LD wite.ETAL ron you AP 7 59988 opt xex O4DearCommissioneroinentEDYjooIamopposedtotheconstructionofas Sutton to Glenallen intertie because:be a WavyFUEDCRAw)fabiic.meaETIAGS W/THE FORRE,©Dp VE B"hfsiRayy.cA AName:oe Kee :Sfeedlhons gpl ay Chen ;Address:Po,Go«Ilo a garess:A An fa unt,cHheKkAcoonl ,AK if i ye VA cdia-fie aul2967¢|(iam Lead)virhualhirstesprycleed4Laonpot_ne 4 pag pum,to Ott.ee |S Dear Commissioner Blatchford: I am opposed to the construction of the Sutton to Glenallen intertie because:(+ will hae an adverse affeeke on the uelihyoffeiathesarea,rt is 2 grove whieusesgottamoviesaporebarrelFis,=-wherName:\avey Beetels one of thsor,Address:0.0.box eSEP MOE sme seeAV.Sattou,a1 |fwDear 'Commissioner Blatchford:'re oIam opposed to the construction of the_Sutton to Glenalien intertie-because:7a ts WAARE C$S45.,toe esorl,,ant ot 'SPO TH beatge THO Antanube valley,iiName:tte we VPelersin Address:Benne J)elivery ; Suthen Hho Gare NECeiveD'.Dear Commissioner Blatchford MAR 2 1994 :WMisioIamopposedtotheconstructicd "éBentSuttontoGlenallenintertiebecause: Po,(Box (2 Surtem,©gagay Dear Commissioner Blatchford: I am opposed to the construction of theSuttontoGlenallenintertie-because: Name Sued D. Address:WO O23 Box GX¥o Falmer,AE 996¢s- ones Dear Commissioner Blatchford: I am opposed to the construction of theSuttontoGlenallenintertiebecause: n&é MAR 2 1994 Olvision OF ENERG Y/UCRAName:DanieT R00 Bow 12SAbe,UW ga gay Dear Commissioner Blatchford: J am opposed to the construction of theSuttontoGlencoatait"bmete tant cod Boy 54387 "Fiabe 1h Gt dier:__abot AK.F ICES faxSow.opp teenth,04 hac CHICKALOON VILLAGE | P.O.BOX 1105 CHICKALOON,ALASKA 99674 (907)745-7184 or (907)745-0505 RESOLUTION 92-09-26 RESOLUTION REGARDING ACTS OF ENVIRONMENTAL CONTAMINATION WHEREAS,Chickaloon Village.is a distinct,independenttraditionalcommunity,and is qualified to exercise powers ofself-government by reason of its original traditional tribal sovereignty as passed down from its ancestors since timeimmemorial;and,WHEREAS,the Chickaloon Village Traditional Council is the governing body of Chickaloon Village as recognized by Chickaloon Village and the United States of America,and is responsible for protecting the health,security,andgeneralwelfareofChickaloonTribalmembers;and WHEREAS,a basic sacred principle of the our culture istodefendthewell-being of our Mother Earth,and the natural world upon which all life depends;and WHEREAS,Chickaloon Village maintains relationships based on family ties as well as peace,friendship and mutual support with Indigenous villages and Nations throughout Alaska;and WHEREAS,The Chickaloon Village Traditional Council is well aware of past and current acts of environmental contamination,carried out by the United States of America, military and other governmental and corporate entities with complete disregard for the People and the Natural environment of Alaska,as demonstrated by the nuclear wastes buried by the Federal government in 1961 near the village of Point Hope,and WHEREAS,the United States of America has consistently failed to disclose the full extent of its hazardous,toxic, medical and nuclear testing,waste programs and sites in Alaska, THEREFORE BE IT RESOLVED that the Chickaloon Village Traditional Council hereby demands that the United States of America and its subdivisions;the State of Alaska; corporations;and other private or public entities immediately CEASE AND DESIST any and all activities in Alaska which could result in further contamination of land,water, air and other living things by radioactive,toxic,hazardous or any other health-threatening substances;and BE IT FURTHER RESOLVED that the Umited States of America (the Army Corps of Engineers,Environmental Protection Agency,etc.)and the State of Alaska Department of Environmental Conservation immediately reveal to Chickaloon Village,other Villages,and the general public,the exact location,history and contents of ALL possible or known hazardous,toxic or radioactive sites in Alaska,including but not limited to:dumps;disposal sites;storage sites; test or experimentation sites and programs;spill or accident sites;and any other locations in which hazardous,toxic and/or radioactive substances have ever been used;and BE IT FURTHER RESOLVED,that the responsible party(s) and/or agencies must undertake immediate,complete clean-up of all such sites,and provide full compensation to victims who have suffered any form of injury resulting from this contamination;and BE If FURTHER RESOLVED,that the Chickaloon Village Traditional Council supports all efforts by the Point Hope Traditional Council to obtain full disclosure of existing pertinent information,to protect the health of its members, and to seek full restoration and restitution from those responsible for this genocidal act of environmental contamination;and BE IT FINALLY RESOLVED,THAT THE CHICKALOON VILLAGE TRADITIONAL COUNCIL RECOGNIZES THE JURISDICTIONAL RIGHTS OF ALL TRADITIONAL INDIGENOUS VILLAGES,TRIBES AND NATIONS AND THEIR AUTHORITY TO PROHIBIT ACTIVITIES WHICH POSE A KNOWN OR SUSPECTED THREAT TO THE WELL-BEING OF THEIR MEMBERS AND TRADITIONAL LANDS,NOW OR IN THE FUTURE. Duly considered and approved September 26,1992'. WA oN cnt.-A,Lhhom 2 aae=ai hee,Zee cl Alan Larson,Chairman Katherine Wade,Elder =Chibi tbet-/Vay)/DsAED eo]<:;Tansy!7Becretary Gary Hafrisdson,Treasurer Mo er ae George Orldola,Elder CHICKALOON VILLAGE P.O.BOX 1105 CHICKALOON,ALASKA 99674 (907)745-7184 (907)745-0505 RESOLUTION 92-07-03 WHEREAS,Chickaloon Athabascan Village is a distinct, independent political community,and as such is qualified to exercise powers of self-government by reason of its originaltribalsovereigntyaspasseddownfromitsancestorssincetimeimmemorial;and, WHEREAS,The Chickaloon Traditional Council is the duly constituted governing body of Chickaloon Village as recognized by Chickaloon Village and the Federal Government of the United States;andWHEREAS,under the Constitution of Chickaloon Village,Chickaloon Tribal Council is charged with the duty of protecting the health,security,and general welfare of the .Chickaloon Tribe and all Tribal members;and WHEREAS,the Sovereign Dena'ina and Ahtna Athabascan People,the ancestors of the current peoples of ChickaloonVillage,have traditionally used,depended upon and lived inharmonywiththeland,water,plant and animal resources.ofChickaloon's traditional subsistence area since time immemorial;and WHEREAS,it is the understanding of Chickaloon Village that we were given by our Creator the responsibility and- obligation to safeguard the well-being of the natural environment of this area as a sacred trust necessary to thesurvivalofourfuturegenerations;and WHEREAS,it is the responsibility of the Chickaloon Council to take action to protect the well-being,health and right of subsistence and survival of its present and future Tribal members,and it is our understanding that these are inseparable from the protection of the Natural environment in which we live;and WHEREAS,the responsibility for protecting the environmental and human health of our traditional subsistence and jurisdictional area predates and supersedes that of any subsequent governmental authority which has claimed and/or assumed jurisdiction over lands within this same area of Alaska;and WHEREAS,Chickaloon Village has never relinquished its sovereignty or jurisdiction to any other governmental body (whether National,State,borough,etc.),and WHEREAS,for the above stated reasons,the protection of the natural environment is an integral part of the essential governmental function of Chickaloon Village Traditional Council;and NOW THEREFORE BE IT RESOLVED,Chickaloon Village Traditional Council enacts the following ENVIRONMENTAL ORDINANCE to protect its traditional subsistence,linguistic, PAGE 1 of 3 cultural and jurisdictional territory. CHICKALOON VILLAGE ENVIRONMENTAL PROTECTION AUTHORITY i.UNLAWFUL ACTS: a.It shall be unlawful for any individual,whether a member of Chickaloon Tribe,another Native Tribe or a non- Native person,any group of persons,corporation,or governmental agency to contaminate,or cause to be contaminated the air,land and/or water within Chickaloon's traditional jurisdictional area with any substance known or suspected of causing damage or harm to humans (living or not yet born),animals,plants,air or water-table ;such substances include but are not limited to the those substances included in the Environmental Protection Agency's list of known toxic and/or radioactive substances.(site EPA document) b.It shall be unlawful for any person ete.to engage in any private or commercial activity (i.e.mining,dumping, toxic waste disposal and transport,weapons testing,etc) which has the potential for such contamination without applying to the Chickaloon Village Council for a permit. Such an application must include a thorough environmental impact statement.Chickaloon Village also requires that copies of all such pending permits and applications currently filed with the State of Alaska be submitted to the Chickaloon Council for review. IL.MONTTORINGANDENFORCEMENT Responsibility for monitoring and enforcement of this ordinance and related environmental protection activities will currently be the carried out by Chickaloon Village's Fish and Game Department under the supervision of the Traditional Council,until that time when Chickaloon Village's law enforcement division is fully operational. Chickaloon Village's law.enforcement division will include at least one Environmental Protection Officer. ItL.REMEDIES a.Chickaloon villages encourages all acts to restore the environment in areas which have been damaged due to past negiigence or neglect,and to prevent future environmental destruction.These include,but are not limited to: recycling of all recyclable substances clean-up of toxic sites,dumps,etc. development of alternative energy sources which are non-polluting use of natural and non-polluting products and substances as alternatives to those that are>whorePAGE 2 of 3 pollution causing 5.Providing education to tribal members and non tribal members residing within Chickaloon's jurisdictional area regarding environmental protection and alternatives to contamination-causing actions. 6.reintroduction of traditional ways of life, subsistence relationships and traditional practices regarding the management and protection of environmental resources IY.REPARATIONS 1.Any person.etc.convicted in Chickaloon Traditional Tribal Court for an act described in section I.will be held responsible for an immediate halt to the action;furthermore the individual,corporation,ete.will be held responsible and financially liable to repair or otherwise restore the damage caused. 2.Furthermore,the person or persons may be remanded for criminal charges in federal court at the discretion oftheChickaloonVillageTribalCourt. Duly considered and approved March 7,1992. Alan noe Katherine Wade Tribal Chairman Tribal Elder jos fii 2 |e /Dat WwiirnatesLa'|Gary Hatri'son Tribal Secretary Tribal Treasurer doe Quik tiGeorgeOndola, Tribal Elder. PAGE 3 of 3 aAECE:V=ID FEB 23 1994 A RESOLUTION OF THE GLACIER VIEW COMMUNITY COUNCT{IN OF Eticnuy/vata REGARDING THE STATE OF ALASKA,DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS,DIVISION OF ENERGY,COPPER VALLEY INTERTIE FEASIBILITY STUDY DRAFT REPORT,JANUARY 1994 Whereas the Glacier View Community Council adopted a resolution on April 7,1993 making recommendations to the Alaska Energy Authority concerning the Copper Valley Intertie Feasibility Study(Sutton to Glennallen Intertie);and, Whereas the April 7,1993 Glacier View Community Council resolution recommended the intertie be north of Athracite Ridgethroughthebackcountry,and, Whereas the proposed design location of the intertie as currently routed will adversely impact Glacier View Community Council businesses,residents and property owners;and, Whereas the Draft Feasibility Study prefered route parallels the highway along the south face of Anthracite Ridge crossing Purinton and Cascade Creeks despite community preferences for the Boulder Creek route;and, Whereas using the Draft Feasibility Study's route selection evaluation criteria supports the Boulder Creek route over the prefered route considering the following evaluation criteria: Cultural resource conflict,section 4a on map page 2 the prefered route parallels the Nelchina trail,indigenous peoples were believed to travel along Anthracite Ridge: Visual Intrusion,private property and residences located alongthehighwayintheCascadeCreekregion; Scenic Viewshed,the intertie will be visible from the highway in the Cascade Creek region; Unstable Slopes,Anthracite Ridge is an unstable geologic formation as evidenced by frequent avalanching of rock on the road in the Long Lake area; Stream Crossings,along the prefered route there are no less than 7 stream crossings; Increased Access,close proximity of prefered route to the highway and trailheads will heavily impact the surrounding land, and wildlife resources; Glacier View electrical substation,Matanuska Electric Assn, testified at the Glacier View Draft Feasibility Study public hearing last week that MEA has no future plans for locating a substation in the area, Whereas the draft feasibility study does not show a planned location of access roads,or evaluate the impact the roads will have upon adjacent lands by increasing vehicular access,thus putting |additional presssure on the fish and wildlife resources;and, Whereas the draft feasibility study assumes a minimum safe distance of 600 feet from residences exposed to possible cancer causing electromagnetic fields which is based upon a (138 KV) transmission line,despite the legal authorization for the intertie to be upgraded to a higher voltage;and, NOW THEREFORE BE IT RESOLVED that the Glacier View Community Council recommends; The utility enter into a take or pay contract with Petro Star Refinery before an intertie is constructed, BE IT FURTHER RESOLVED that the Glacier View Community Council recommends: .Access Roads be minimized if not entirely deleted and The Boulder Creek route be designated as the only acceptable route in the final Feasibility Study,and absolutely no highway route,and The safe clearance distance be designed for the line to beupgradedtoahighervoltage. Adopted be the Glacier View Community Council this 16th day ofFebruary,1994. Katherine Wright,Secretary of the G.V.C.C.745-4763 ¢gchinne ie 2-17-49 RECEIVED FEB 251994 __DMISIONGREATERCOPPERVALLEYCHAMBEROFCOMMERCE RESOLUTION IN SUPPORT OF _| THE SUTTON TO GLENNALLEN INTERTIE PROJECT WHEREAS the Greater Copper Valley Chamber of Commerce is located within the Copper River Basin,and the people and businesses represented by the Chamber reside in the area between Paxson and Valdez,and from Sheep Mountain to Slana,which is primarily within the service territory of Copper Valley Electric Association and are therefore member/owners receiving central station service from Copper Valley Electric;and WHEREAS Copper Valley Electric Association's rates are among the highest unsubsidized electrical rates in the State of Alaska;and WHEREAS Copper Valley Electric Association has pursued many alternatives to facilitate rate stability and possibly rate reduction for its member/owners,and as a result of an economical reassessment of various proposals,it was determined to be in the best interest of the members that Copper Valley Electric pursue the design and construction of the Sutton to Glennallen intertie;and WHEREAS the Sutton to Glennallen intertie will benefit the people of the Copper River Basin and the City of Valdez,through future rate stabilization and possibly a rate reduction,it would reduce or possibly eliminate the need for fossil fuel generation and the exhaust emissions,and would support the economical development of our area;now therefore BE IT RESOLVED,the Greater Copper Valley Chamber of Commerce supports Copper Valley Electric Association's efforts and respectfully requests the Department of Community and Regional Affairs;Division of Energy to support and approve the loan funding for the design and construction of the Sutton to Glennallen intertie. Approved and signed this _14th_day of _October_,in Glennallen,Alaska. Secretary (Attest)se” (seal) -4 om ee GREATER COPPER VALLEY CHAMBER OF COMMERCE P.O.BOX 469 FEB 25 1994 GLENNALLEN,ALASKA 99588 DIVISION OF ENERGY/DCRA We the undersigned members of the Greater Copper Valley Chamber of Commerce support the construction of the Sutton-Glennallen Intertie.The Energy Division is strongly urged to support the line as well.The long term economic benefits far outweigh the costs of the project.Let us remain viable business entities by providing stable power rates to the Copper Valley region.This can only be done with the construction of this line. SIGNATURE PRINTED NAME ADDRESS PHONE # 2__sbokn tH Dounes Woy 307 Copee Die 922-3444inaStaSheohessbor24>Salller &25-V2L.Aven Lettiasrer.”UiDigctoe (Groconen,Ak PAA Lo-7)ont Man 284)Dare bj NA -_Telonsern fax Pe Vildoc fle ee,Lely Wehr |Seo CC %4r Box 223 Cane llen Use Fee Fee go>PS F22-359¢(im Loge As Le)Nezk,>Kee 22 LB:eongather AK GPPEEEReidStraszbh-e EXKWO Chanelle.KL ic £2255; \TIMervc,Ocks WR Bos DS GlennallenAK 830-San2"TLL A.Suamvon SApvedta P.O.8.38 Glenna llen AK 73a-36I9CLinSherkTinsashouskyPo.Bow VES Clennaten,AE 423-3567LekCalaltdfle125CleanYue,Dates'pe Chester Vero.Ke berson Bot 375 Marrobla OW 822-3363el,Chou Be.37S Ghuralhe Ae R22 -3363 om,aMECEIVED SIGNATURE PRINTED NAME ADDRESS . FEB 2 §199PHONE # DIVISION OF ENERABO-SE WIS "5 Sox 224 Garon Betss24:Lapans.CopoerCualor BK BG,E DZAIZIEOEniga|oe neyCates!(EZ Bal3 79 yr12-B¢a7E.G JBLDABIG ER FPAGEEJetAeAindes£.Léwegan $0 -B0x 28 Glecrulles ae922-8089lnpriAe!fXFB cme Fag i MBsdbo Neohn M.Bas tke Boy 227 a FES 8BRtntxdpeMBYINEBeckerWie:perlevtes;6,2ogeepieandt{RIG rq Sean.Pwr aQh Hla |Lobes Op Kar Lies)los he EIST,Lebo,VeeiR99b4)a rathy ok Prnig Cah Pi [ans 4 Ha 03 Lieb Is €Lehr heDawL.Qo iloRS Bsx A&G Cakina ae 795% Seanne &kems B23 bavown AL VISE Roy $Swe 4 Box 215 Ca Kona Ak FIS6EEx2.C leonda Ewen Box 217 Gakona ,AK GesFh 'Aka Weed LINDA WEIR BOK 227 Ae koug 4h Daw kbar Vera larr flox/ep He nnallon Beeps ADB at AEFafos uc "Lave Lac lbh&_$LEUWWAlEeSAE2RGFALIS.easDTel bye 32%Veanadlin £FEPS-ZéCeG Lbecez Lowice Br b67/_Gceawaccenl 77SEE A Le 226)mac Box 377 Clen dhe g95x% Matanuska-Susitna Borough 350 EAST DAHLIA AVE,PALMER,ALASKA 99645-6488 «PHONE 745-9683 BOROUGH CLERK'S OFFICE we ve tvud February 23,1994 FEB 25 1994 .DIVISION OF ENéius,cond Mr Herv Hensley Director | Division of Energy Alaska Department of Community &Regional Affairs 333 West 4th Avenue,Suite 220 Anchorage,AK 99501-2341 Dear Mr Hensley: Enclosed for your information are copies of two resolutions regarding the Copper Valley Intertie Feasibility Study Draft Report of January 1994.The Planning Commission passed Resolution 94-12 (AM)on February 18 and the Matanuska-Susitna Borough Assembly passed Resolution _94-021 (AM)on February 22,1994. As you are aware,there is considerable opposition to the proposed intertie from Matanuska Valley communities.The borough Planning Commission and Assembly share their concerns and,like our residents,support alternative cost-effective sources to supply energy needs to Copper Valley residents. Sincerely, po,aPACSLAS LINDA A.DAHL Borough Clerk PLN/Idk/JD414 MATANUSKA-SUSITNA BOROUGH PLANNING COMMISSION RESOLUTION 94-12 (AM) A RESOLUTION OF THE MATANUSKA-SUSITNA BOROUGH PLANNING COMMISSION REGARDING THE STATE OF ALASKA,DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS,DIVISION OF ENERGY COPPER VALLEY INTERTIE FEASIBILITY STUDY DRAFT REPORT,January 1994 WHEREAS,the Matanuska-Susitna Borough Assembly adopted Resolution 93-035 on April 13, 1993 making recommendations to the Alaska Energy Authority concerning the Copper Valley Intertie Feasibility Study;and WHEREAS,the Copper Valley Intertie Feasibility Study Draft Report compiled by R.W.Beck &Associates was issued in January 1994;and WHEREAS,in Resolution 93-035 the Assembly expressed concern about the potential impacts on health,tourism drawing potential,fish and wildlife habitat,and wetlands;and WHEREAS,proposed route alternative D attempts to mitigate health concerns by locating the 138-kV intertie more than 600 feet from homes and other occupied structures;and . WHEREAS,the Environmental Report prepared by Dames &Moore,Inc.acknowledges that "the most significant impacts resulting from this project would be visual and recreation impacts in the project area";and . WHEREAS,Dames &Moore,Inc.recognizes that "the Matanuska Valley is a highly scenic area with many businesses in the small communities oriented toward tourism”and "use of a backcountry route could mitigate the visual impacts along the scenic Glenn Highway..";and WHEREAS,Dames &Moore,Inc.states that use of a backcountry route "could still result in an impact on recreational users..";and WHEREAS,although a stated route selection criterion is to avoid direct conflicts with the Chickaloon-Knik-Nelchina trail system,it appears that proposed route alternative D would parallel or be visible from the trail for several miles on map 2;and WHEREAS,the Boulder Creek route is preferred by the Glacier View community;and WHEREAS,Dames &Moore,Inc.identifies as a lesser impact "increased pressure on wildlife and recreation resources due to increased access to the area”and suggests mitigation of these impacts by "limiting additional access roads associated with the project";and WHEREAS,it is unknown what access roads are proposed since the study states a more detailed right-of-way access plan will not be prepared until the ROW acquisition phase of development of the project;and WHEREAS,oil production on the North Slope is projected to decline over the next few years with the eventual closure of the Trans Alaska Pipeline System by 2017;and WHEREAS,the draft feasibility report identifies the intertie as economically feasible only in the high and medium-high load growth cases which assume that the Petro Star refinery in Valdez will operate through 2047;and WHEREAS,the Petro Star refinery could possibly generate its own power for less cost;and WHEREAS,construction of a marginally feasible capital project seems at this time to be an imprudent investment. NOW,THEREFORE,BE IT RESOLVED that the Matanuska-Susitna Borough Planning Commission expresses the following concerns about the environmental impacts of the proposed project: e the Environmental Report finds the intertie will negatively impact tourism and recreation whether routed along the highway or in the backcountry; e the Environmental Report finds the intertie will likely increase pressure on wildlife and recreation resources due to increased access to the area; e the draft feasibility study does not specify what additional access will be created,making it difficult to quantify these effects;and BE IT FURTHER RESOLVED that the Matanuska-Susitna Borough Planning Commission supports consideration of an alternative scenario which projects co-generation of electricity at the Petro Star refinery;and BE IT FURTHER RESOLVED that the Matanuska-Susitna Borough Planning Commission considers it inappropriate to pursue a capital project with marginal feasibility at a time when the State of Alaska is experiencing a severe budget shortfall. ADOPTED by the Matanuska-Susitna Borough Planning Commission,this |oun day of Febrnasay ,1994. orl Dew,orCARLDEPRfEST,Chairman ATTEST: Lt,Certin.. LINDA KETCHUM,Planning Clerk MATANUSKA-SUSITNA BOROUGHRESOLUTION94-0212 4M) A RESOLUTION OF THE MATANUSKA-SUSITNA BOROUGH ASSEMBLY REGARDING THE , STATE OF ALASKA,DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS,DIVISION OF ENERGY COPPER VALLEY INTERTIE FEASIBILITY STUDY DRAFT REPORT,January 1994 WHEREAS,the Matanuska-Susitna Borough Assembly adopted Resolution 93-035 on April 13, 1993 making recommendations to the Alaska Energy Authority concerning the Copper Valley IntertieFeasibilityStudy;and WHEREAS,the Copper Valley Intertie Feasibility Study Draft Report compiled by R.W.Beck&Associates was issuedin January 1994;and WHEREAS,in Resolution 93-035 the Assembly expressed concern about the potential impacts on health,tourism drawing potential,fish and wildlife habitat,and wetlands;and WHEREAS,proposed route alternative D attempts to mitigate health concerns by locating the 138-kV intertie more than 600 feet from homes and other occupied structures;and WHEREAS,the Environmental Report prepared by Dames &Moore,Inc.acknowledges that "the most significant impacts resulting from this project would be visual and recreation impacts in the project area";and | WHEREAS,Dames &Moore,Inc.recognizes that "the Matanuska Valley is a highly scenic area with many businesses in the small communities oriented toward tourism”and "use of a backcountry route could mitigate the visual impacts along the scenic Glenn Highway..";and WHEREAS,Dames &Moore,Inc.states that use of a backcountry route "could still result in an impact on recreational users..";and WHEREAS,although a stated route selection criterion is to avoid direct conflicts with the Chickaloon-Knik-Nelchina trail system,it appears that proposed route alternative D would parallel or be visible from the trail for several miles on map 2;and WHEREAS,the Boulder Creek route is preferred by the Glacier View community;and WHEREAS,Dames &Moore,Inc.identifies as a lesser impact "increased pressure on wildlife and recreation resources due to increased access to the area”and suggests mitigation of these impacts by "limiting additional access roads associated with the project";and WHEREAS,it is unknown what access roads are proposed since the study states a more detailed right-of-way access plan will not be prepared until the ROW acquisition phase of development of the project;and Page 1 of2 AM 94-058 PLN/Idk/RESO-CVI WHEREAS,oil production on the North Slope is projected to decline over the next few years with the eventual closure of the Trans Alaska Pipeline System by 2017;and WHEREAS,the draft feasibility report identifies the intertie as economically feasible only in the high and medium-high load growth cases which assume that the Petro Star refinery in Valdez will operate through 2047;and WHEREAS,the Petro Star refinery could possibly generate its own power for less cost;and WHEREAS,construction of a marginally feasible capital project seems at this time to be an imprudent investment. NOW,THEREFORC,BE IT RESOLVED that the Matanuska-Susitna Rorough Assembly expresses the following concerns about the environmental impacts of the proposed project: *the Environmental Report finds the intertie will negatively impact tourism and recreation whether routed along the highway or in the backcountry; *the Environmental Report finds the intertie will likely increase pressure on wildlife and recreation resources due to increased access to the area; *the draft feasibility study does not specify what additional access will be.created,making it difficult to quantify these effects;and BE IT FURTHER RESOLVED that the Matanuska-Susitna Borough Assembly supports alternative cost effective sources to supply energy needs to Copper Valley residents;and BE IT FURTHER RESOLVED that the Matanuska-Susitna Borough Assembly considers it inappropriate to pursue a capital project with marginal feasibility at a time when the State of Alaska is experiencing a severe budget shortfall.,ADOPTED by the Matanuska-Susitna Borough Assembly this x2 fel day ofBboererus,1994. Min >Ghlay foeyousW.BRANNON,Borough MayorATTEST: Bete-PL VawterLINDAA.DAHL,Borough Clerk . (SEAL) Page 2 of 2 AM 94-058PLN/idk/RESO-CVI Qso 94-021 LAm!)