Loading...
HomeMy WebLinkAboutSEIRP review meeting Dec 2011Southeast Alaska IRP AEA/SE Conference Review Meeting Agenda *Key Findings ©Project Overview ¢General Assumptions ¢Electric Load and Heating Requirements Forecasts ¢Hydro Project Evaluation ¢Other Generating Unit Alternatives e Transmission Evaluation ¢Demand-side Options ¢Space Heating Conversions ¢Summary of Integrated Results ¢Implementation Risks and Issues *Conclusions and Recommendations ¢Near-Term Implementation Plan (2012-2014) 12/14/2011 12/14/2011 KEY FINDINGS Key Findings ¢Historical Crossroad ¢Sub-regional Differences ("Haves”vs."Have Nots”) ¢External Energy Drivers ¢Shortage of Storage Hydro e Inflexible Business Structure ¢Solutions Must be Developed for Each Sub-region ¢Space Heating Conversions ¢Uncertainties ¢Lack of Information on Potential Hydro Projects Key Findings (continued) ¢Need for Balanced Portfolio of Resources -Can't Just Build More Hydro ¢Economic Realities of SE Intertie Concept ¢AK-BC Intertie ¢Role of Technology Innovations *Need for Joint Action ¢Phased Approach to the Future ¢Aggressive Pursuit of DSM/EE Programs ¢Aggressive Pursuit of Biomass Space Heating Conversions Key Findings (continued) ¢Load Uncertainties due to Economic Development Efforts and Potential Mines ¢Need for Continued State Financial Assistance ¢Proposed AEA Decision Framework and Policy ¢Encourage Private Development of Resources 12/14/2011 PROJECT OVERVIEW con FSituationalAssessmentEconomclloadNonect pce,Eiming Generation ana |Retebiity-oDriversandissuesParametersForecasts Forecasts Transmsson Resources Crtena . 1Potential Scresoine Process eB Sect nabity Hydro Projets cad 0 Slocage Cra acter ats a -FERC cee we Ractcn in transmis On Lonty,apes ia + Onhe |Resources =ws ©Coregcia:tat £ Conventions and #Face in transi ay ot oats r,iat Risk Assesament Renewanies Modeling #Resource potential taaticst 0 ged cee ourent ard opeat cowseatcast©Fuel sucnty.'menurcanthalt drmyment otConservation!Pi ONS aH ears memweppemerene,B OM one ator ae)8 Breer ore ertatDsmhesageatOoMeasuresthatmassRN!Test i eee tharamawar and ©Thana anon const ante --eer gromesrts wagramy -case ator danish*©Ges ates legaetsaShayD6rescutcesetaitlegweve er SSM ence 9 Pec itakety sv meegeswe ©Locator ot peter tar generation Fences tz9Detertonereainndgeneationrm ,:tat cdot eae erent |Tlieconercssesnanoromeronalll |Transmission }4 ©)6 Deter Bans ior Coton 7 .SNM Cans ©Compa:@ tr anart gniar ita 10 iheashoidLostofOeiema#Bua vote pac beret i nat | .rsblie Participation!»| 12/14/2011 Existing Utility Systems Included Utility Systems Elfin Cover Petersburg VeeUIETe(oninggreptaSE Alaska Sub-regions Tr.TOERHEA12/14/2011 Committed Resources Blue Lake Hydro The Blue Lake Hydro expansion will increase the capacity of the existing Gartina Falls Hydro Reynolds Creek Hydro Thayer Creek Hydro Whitman Lake Hydro Kake -Petersburg intertie Ketchikan -Metlakatla Intertie Blue Lake Hydro Project by an estimated 8 MW and increase the average annual energy from the project by and approximately 34,500 MWh.TheBlueLakeHydroProjectislocatedinandwillbeownedbySitka. The Gartina Falls Hydro project is a new run-of-river project near Hoonah and will provide an estimated 0.44 MW of capacity and approximately 1,800 MWh of average annual energy. 'The Reynolds Creek Hydro project is a new storage project located near Hydaburg.The project will provide an estimated 5 MW of capacity and approximately 19,300 MWh of average annual energy.The project is jointly owned by Haida Energy,Inc.and AP&T and will provide capacity and energy to AP&T. The Thayer Creek Hydro project is a new run-of-river project located near Angoon.The project will provide an estimated 1 MW of capacity and approximately 8,400 MWh of average annual energy.The project is ly owned by Inc. The Whitman Lake Hydro project is a new storage project located near Ketchikan.The project will provide an estimated 4.6 MW of capacity and approximately 15,900 MWh of average annual energy.The project is owned by Ketchikan Public Utilities. The Kake-Petersburg Intertie will be a new 69 kV overhead and submarine cable ion line ing Kake and P @ The interconnection is currently being developed by Kwaan Electric Transmission Intertie Cooperative. The Ketchikan-Metlakatla Intertie will be new 34.5 kV overhead and submarine cable i line ikan and Metlakatl. The interconnection is currently owned and is being developed by the Metlakatla Indian Community. Issues and Drivers RNAL DRIV!t |REGIONALISS' e@ Federal and State energy policy legislation @ Uniqueness of Southeast Alaska ©Carbon and other environmental ©Size and geographic expanse restrictions ©Limited interconnections and redundancies ©State energy policy legislation ©Inflexible utility business structure ©The State's role in developing energy e Sub-regional Differences infrastructure o Cost of electricity e Fossil fuel prices and availability e Land use regulations ©Conversion to electric space heating ©Rapidly declining excess hydro High cost of space heating Declining population in communities Declining economies in communities Difficulty in developing new hydro and transmission interconnection projects Low levels of weatherization and energy efficiency Availability and cost of capital ©Historical dependence on State funding e@ Risk management issues ©Need to maintain flexibility oO Aging infrastructure ©Ability to spread regional risks°12/14/2011 GENERAL ASSUMPTIONS General Assumptions *Fuel Price Projections and Emission Allowance Costs ¢Natural Gas ¢Community Diesel ¢Heating Oil ¢Economic Parameters ¢Inflation and Escalation Rates ¢Financing Rates ¢Present Worth Discount Rate ¢Interest During Construction Rate ¢Fixed Charge Rate ¢Reliability Criteria 12/14/2011 List of Sections that Summarize Assumptions *Section 4 -Description of Existing System and Committed Resources *Section 5 -Fuel Price Projections ¢Section 6 Economic Parameters ©Section 7 -Reliability Criteria *Section 8 -Load Forecasts ¢Section 9 -Financing Alternatives ¢Section 10 -Potential Hydro Projects ¢Section 11 -Other Generating Unit Alternatives ¢Section 12 -Transmission Interconnection Alternatives ¢Section 13 -Demand-Side Options *Section 14 --Weatherization *Section 15 Space Heating Conversion ELECTRIC LOAD AND HEATING REQUIREMENTS FORECASTS 12/14/2011 Electric Load Forecasts -Assumptions ¢Sources of information include: ¢Historical loads/existing load forecasts from utilities ¢Department of Labor population forecast *Census ¢Information from utilities ¢B&V analysis and development of load forecast ¢Reference Scenario -continuing existing trends ¢High Scenario -economic development and EVs ¢Low Scenario -DSM/EE and policies to discourage heating conversion Electric Load Forecasts -Results See Sub-region Summary Sheets 12/14/2011 Space Heating Forecast -Assumptions ¢Sources of information include: e Alaska Energy Pathway *«Department of Labor population forecast ¢Census ¢B&V developed Reference Case heating requirements forecast Space Heating Forecast -Results See Sub-region Summary Sheets 12/14/2011 10 HYDRO PROJECT EVALUATION Hydro Evaluation Process i 4 i Bak PL ge oe1: 12/14/2011 11 Limitations of Hydro Evaluation e Variety in quality and inclusiveness of project information ¢CODs °Capital costs ¢Energy output/storage capacity ¢Environmental,permitting and licensing issues ¢Business structure and agreements Inability to make "apples to apples”comparison and definitive choice among projects ¢Need for AEA Standardized Decision Package 'Acca -Kieok Laie Wrangell Seorage as 905413582 10.528-15,703 28,100 Cagcac Crosk Petersburg Seoraga To 14635-21953 2,091-9,136 202.300 Conaail Laae Sencha Storage 170 540-1080 21766353 10,600 Make Sbebodcomn Wregll Storage 10.00 7.009100 3,900,100 40,000 'Mahoney Lake Keorchiion,orege 960 WASDSLIG =ASOESIOZ 46,066 Orcteare ae Meyers Cac =Storage 10.00 3420-7990 34707900 56.000 Rah ade Peersbury Srorage Mseiz8e2 42276341 70,700 Scenery Cresk,Pemrabnery Stare sone 17a9e19348 «ATE 128,700 Sunrice Labe 'Wrangell Storage 400 16642496 41606240 13.500 'Thoms Lake 'Wore Storage 70 11012-13517 14,681-18023 24,200 'Trianghe Lake Metakats Storage 30 126-1895 =NGODSAte 13.100 'Tye New Dam Construction Wrangell Storage 1.HOOSS4 26.193-61,000 9,100 'Tyoa New Third Tartine 'Wrangell Searage 10.00 1320-3080 ©1,820-3,080 'Virginia Lake 'Wrangett Srorags 12.00 10321-15481 6601-12901 43.800 Rarened ited Takats tale Soe Storage 70 ITMEI7SSS «4225-6338 106,900 'Ceichagol tahoeCrookedCreekandfim's Lake ttn Cove Srorage/fam-ctRiver 0.16 140-222 SISOIUSTS 666 indian River 'Teoaken Springs Remr-of iver ozs 202302 0012000 (916 'Water Supply Crowk,Hoonah Rearobriver ono sasazs 13,725-20575 1.400 Janeen Arve Laks Dorothy Expansion jereon 'Storage 200 7140-16660 25805950 96,000 'Sweetheart Lake -'Storage 3008 BLEZIT400 ©2761-4136 136,000 'Upper Lyne ComalCommeliyLalor Haines Sung 1200 WONOSS20 10674600 W762 Schrbee take Skagwey Sone 490 36005400 (7.347-11.020 25,008 'Walter (aks Cathet Voliey.feat river 109 600-412 600091202750 West Coek Skagway 25.00 11200-16800 44806720 76,600 Note:This table is provided for general information purposes. The information shown in this table was gathered from muitiple sources,and the quality and inclusi of this inf varies significantly across the projects shown.Black &Veatch and HDR have compieted a high- level review of this available information and show a range of capital costs for each project to reflect the uncertainties associated with the available information.Asa result of the wide variation in the quality and inclusiveness of project-specific information,the AEA believes that this information should notbeused,in its current form,tomakeanyinvestmentdecisions. 12/14/2011 12 Requirements Gaps -SEAPA Sub-region(EXAMPLE) SEAPA Annual Diesel Generation Diesel -Reference Case Load Forecast ==-Diesel-High Case Load Forecast 400,000 350,000 300,000 250,000 200,000MWh150,000 - 100,000 -50,000 ee -- i O tat reer IT T TTI TOTO sc ee ee eh See aVOnOWYABADDnhnooDYOBN A ©MF SP DY PD OP?PoP oh 8 Oe OY oP OO OSAPPAPhPlBlAP”AH APE A PE ED""HP" 'Available Projects /Poteatial Potential 'Note:the potential annual generation figure{s)frem Screened |Anseal 'Available Projects rom =|Anaual 'shown in the table will differ from actual generation,Generation Generation andtheProjectListProjectlict(wow sndstorae'awta-Kunklake |28100 |Scene Creek 12870 capabitiesCadeGeek|T0230 |Se Lbe 13500 toad profile Connell Lake 10,600 'Thoms Late ae lake Seto 00 'Triangle Lake 110 Mahoney Lake BG 'TyeeNew Dam Coastruction |9,100'Orchard Lake 56000 'Tyee New Third Turbine NARothLake7,0 'Virginia Lake.43,800 Development of Generic Hydro Projects a Fs 8 |SS 2 'RUN-OF-RIVER 1 su $200 $920 $103,11000 0.45 39780-25823 2470 3914469 189 18Z 35D.508-380 326 STORAGE 1 $16 $200 $1338 «$103 16000 0.66.5771 703599 "7 4134469 351 69 300 412 m1 738 5 6 $900 $3,847 $516 9200 0.66 28856 «S513 299622332814 231818451753 1843 1502 2058 3006-3675. 10 $75 $900 $6272 $1,032 7500 0.66 S7,712 7026 «=5992 4466 42290-46360 «3690-3507 685 2004 4116 6012,7349. 20 $97 $900 $8,112 $2,064 4850 0.66 115424 14052 11983 8931 «BASH 9273-7379 7014-7371 «6007 0232 «12024 14699 2 $108 $900,$9,031 $2,580 4320 0.66 144,200 17566 34979 11164 10872 11591 9224 8767-9213.7509 10291 15030 18374 12/14/2011 13 Generic(EXAMP roy bee fone POE ERP PIED PESEDP OLDE GE SE REDE wert See ere Hydro Project Risk Evaluation DEVELOPMENT LEVEL (1)Design Level -geology known,engineering d d:high for cost (2)Feasibility level of information (3)Reconnaissance level of information of current design (4)Previous study information is outdated (5)Superficial:low for cost LICENSING/PERMITTING (1)Ad d,terms and conditions of agencies known (evidenced by 2nd stage consultation,Draft License Application,or FERC License) (3)Minimal (evidenced by Preliminary Permit, Preliminary lication D.1st stageconsultation) (5)None CONSTRUCTABILITY /RELIABILITY ACCESS {1}Existing road access,nearby community {3)No road access,nearby community (5)No road access,remote location BUSINESS AND FINANCIAL STRUCTURE (1)Financing in place (2)Power Sales and Wheeling Agreements in place (3)Power Sales and Wheeling Agreements in active Negotiation (4)Ownership established (5)Ownership not established HYDROLOGY (1)Low -existing gage data,detailed hydrologic study resulting in high confidence for energy estimate. (3)High -minimal site specific hydrologic data Iting in low d for energy OPERATING FLEXIBILITY (1)More than 25 percent of project's energy is available in February through April (3)More than 20 percent of project's energy is available in February through April (5)Less than 20 percent of project's energy is available in February through April PROJECT LINE MAINTENANCE (1)Project is near a community,overhead transmission line (3)Project is remote,overhead transmission line {5)Connected by submarine cable 12/14/2011 14 Hydro Project Risk Evaluation |euwewepeneeecaml|PN|I i |e ee |e mew |ed=ofSd'Ania unis Lae Wrenge .s '.''Cacao Crook Pevneene a s ''2 sConesalesRonchi':1 .1 s{Lain Sotho Wrangell s 2 ..1 .Mammary Lalas Kanchi 2 1 2 ry 1 ?Orchard Lam Meyers Cnacts .'.5 2 .Pict Lalas Poverty,'2 '...Seenary Creek Paterbucg,.3 ''s .Senrion Laine wget 2 3 ,5 '.Thome tab Wranget «'3 s 1 s'Triangle Laima»Metiatcatin 3 '3 '2 ''Tyee New Dam Construction Wrnaget '.'s 2 1'Tyee Kew Thied Tartine Wong ''.s FY 'Viegiots Late Wrangetl 4 '''4 sDenevehandTaleLaeSeen'2 ''1 1ChichegettstendCrovieedCrosudjmsLaeTitecove3.2 '1 5)tadian atver Tenakee springs 3 's '1 . 'Waner fupply Crek,Hocash 3 '1 '1 .freon Area(Late Doreany Expancion fama '1 1SrewethsertLalasfmm2'.1 2'UppertymeconeConmetyLobe Hakzes 3 s '2 2 ''Schboe Lalas Feageny s 3 '2 ':'wate Lae rte Valey .'1 s 1 .Weer Croat seageey :5 1 's : Note:The risk-related ratings shown in this table are based upon the project-sspecific Information available at this time and subject to change as projects move through thedevelopmentprocess,Thare ratings are not additive for f projects,Ce the AEA believes that this information should not be used, in tt current form,to make any investment decisions. OTHER GENERATING UNIT ALTERNATIVES 12/14/2011 15 Other Generation Technologies Considered ¢Geothermal ¢Wind ¢Wave Energy Conversion ¢Tidal *Biomass ¢Coal ¢Diesel e Nuclear Renewables Potential a Munictoatt cf Se aiway q Sn,Gat}»AGS 8 " « ty M7)WW ant ek):Me /Coy &GoroughLf:"a aw Z Of Janmesu J See at a City &Baro.gh .a Dye ,!aan aB.Of Yonutat md an ;a San,von X .Cage Parmenter Baveameny (Rogenaewr ona4farno i *os aD ald fSomen Bort mynareae,BOT,!a x Hw " 'trod care ¢ALT,rene ."A Seataska Corp ant eet ,,awaCity&Borough * Of Sitka ----- keSener fa Mi Boren, / ben.:rags Ferea |"TRF _erersouna J a -_4 i awe ;wh 'f:gro A .™(nce gSTTWA Be Say?RIWRANGELL mgaBehae f \ Legend.MumbersAndSpeed Harta We=Bomas CeCos Ges eomema GaeGe T+"de aa 12/14/2011 16 TRANSMISSION EVALUATION Transmission Interconnections Evaluated ¢SEI-1A:Hawks Inlet -Hoonah ¢SEI-2:Kake -Petersburg ¢SEI-3:Ketchikan -Metlakatla e SEI-4:Ketchikan -Prince of Wales *SEI-5:Kake -Sitka ¢SEI-6:Hawks Inlet -Angoon -Sitka Two Cases Evaluated ¢Economic *Public Benefit *SEI-6 Alternate:Hoonah -Tenakee Springs -Angoon -Sitka ¢SEI -5 and SEI-6:North -South ¢SEI-7:Hoonah -Gustavus ¢SEl-8:Juneau -Haines e SEI-9:Pelican -Hoonah 12/14/2011 17 Transmission Economic Case Evaluation INTERCONNECTION SEI-1A Hawks Inlet -Hoonah SEI-4 Ketchikan -Prince of Wales SEIS Kake -Sitka SEI-6 Hawi Inlet -Angoon -Sitka SEI-6 Alternate SEI-S and SEI-6 North -South SEI-7 Hoonah -Gustavus SEI-8 Juneau -Haines SEI-9 Pelican -Hoonah 2011 Diesel Generation Cost Note 1;The annual transmission interconnection cost does not include any cost for the generating the electricity that would be transmitted over each transmission interconnection. Hoonah -Tenakee Springs -Angoon -Sitka 28.5 35.2 55 102 106 137 29 85.3 55 471,000 497,000 789,000 350,000 319,000 288,000 93,180 o 4844 632 255 'SEI-6 Alternate 'SEI-5 and SEI-6 'SEI-? SEI-8 SEI-9 29 853 1451 276.8 S19 522.9 110.5, 239.5 46.7 1311 101 370 025 991 032 B85 - 255 0.10 45 - 12/14/2011 18 DEMAND-SIDE OPTIONS DSM/EE Measure Cost-Effectiveness Screening ¢Cost-Effectiveness Tests ¢Total Resource Cost (TRC)Test ¢Ratepayer Impact Measure (RIM)Test .©Participant Test e Categories of Communities ¢High Cost Utilities e Mid Cost Utilities ¢Low Cost Utilities 12/14/2011 19 DSM/EE Measure Cost-Effectiveness Screening Results See DSM Cost-Effectiveness Screening Results Sheets DSM/EE Programs Included in Low ScenarioLoadForecasts |RESIDE 'FIA! Water Heater Appliance Water Heater Lighting Appliance Water Heater Lighting Cooling/Heating HIGH COST UTILITIES Water Heater Motor Refrigeration Lighting Cooling/Heating MEDIUM COST UTILITIES Water Heater Motor Refrigeration Lighting Cooling/Heating LOW COST UTILITIES Water Heater Office Load Motor Lighting Refrigeration Cooling/Heating 12/14/2011 20 DSM/EE Program Impacts See Sub-region Summary Sheets SPACE HEATING CONVERSIONS 12/14/2011 21 Space Heating Biomass Conversions -Admiralty Island (EXAMPLE) Admiralty Island 440,20 p tot 3EYa (80.200 2 é 5 ten @ i8eoce0& >400 40.900 200 20.500+ SEER FSSSERPPPERLPELEERE EER:SRR RRSP Peres ee PER RRR EEE B ELE -Soace temeng |I snared -Sconce "eatng Ps Space Heating Biomass Conversions -Admiralty Island (EXAMPLE) Admiralty Island Piel fi 2 3548 Ss 2 2 ee e8 3 3 BF ee SEBRPReErRegzeReReReRKRERRRTSERKRRERKRRRRAAAtem-9O -Scare tavesg Sis acedd -Soace teeng 12/14/2011 22 Savings From Pellet Conversion Program uy PELLED IL SPACE,SPACEEATINELL)EATING: OS:OST:EQUIPMEN Northern 147,786 39,089 23,925 6,849 69,863 77,923 Chichagof Island 58,459 13,753 11,950 2,806 28,509 29,950 Baranof Island 460,426 121,745 98,280 23,655 243,680 216,746 Upper Lynn Canal 347,271 90,274 67,919 16,287 174,480 172,791 Admiralty Island 22,334 6,830 4,717 1,195 12,742 9,592 Prince of Whales 366,725 94,304 77,469 14,916 186,689 180,036 Juneau 2,120,883 541,759 490,307 111,314 1,143,380 977,503 SEAPA 977,320 258,011 238,441 61,875 558,327 418,993 Total Southeast Region 4,501,204 1,165,765 1,013,008 238,897 2,417,670 2,083,534 Pellet Conversion Program -Annual CapitalCosts ene |Cee'|Seed |Pees |Conars |Rane |Pines |Sean |Somes|was |eat143,994 313,738 1,329,524 10,300 2,663,683 25,201,783 1,624,722 11,379,543 43,447,975, 2013 749,208 108,636 417,040 1,504,568 44,982 2,644,399 26,393,070 1,828,249 12,016,390 45,706,543 2014 *828,232 249,470 327,381 1,746,178 10,927 2,825,901 27,875,739 1,839,606 12,675,742 48,379,177 2015 800,462 146,091 320,320 2,046,651 47,722 2,916,306 29,442,860 2,290,523 13,318,782 51,328,717 2016 894,554 107,117 503,357 2,104,778 17,389 3,019,677 30,490,589 2,182,772 13,953,371 $3,243,603 2017 849,210 149,018 327,887 1,881,349 56,598 2,976,295 30,749,354 2,048,874 14,495,078 53,533,663 2018 926,034 222,484 285,577 1,983,787 6,149 3,180,877 31,923,774 2,087,342 15,136,673 55,752,396 2019 900,927 104,382 418,921 1,995,923 12,668 3,187,581 33,054,972 2,143,628 18,930,901 57,719,872 2020 988,953 156,312 296,444 2,098,075 61,846 3,252,278 34,360,615.2,243,688 16,578,970 60,037,181 2021 1,011,902 104,019 298,618 2,117,475 13,439 3.482.222 35,869,061 2,543,899 17,373,076 62,813,711 12/14/2011 23 SUMMARY OF INTEGRATED RESULTS Summary Optimal Hydro/Transmission 1,407 5,313 340 Case Optimal DSM/EE,Biomass and 2,030 3,093 2,561 Other Renewables Case Status Quo Case 770 5,654 12/14/2011 24 Results of Integrated Cases -Sub-regionalSavings OPTIMAL HYDRGO/TR DN CASE -SAVINGS RELATIVE TO STATUS QUO CASE Total Cumulative Net Present Value (CNPV)Savings ($'000) Oil Space Heating Utility System Costs Plus Costs Total $%s %$% SEAPA 167,356 37%0 0%167,356 12% Admiralty Island 0 0%0 0%0 0% Baranof Island 198 0%i)0%198 0% Chichagof Island 7,934 13%0 0%7,934 7% Juneau 136,408 37%0 0%136,408 5% Northern 26,239 29%0 0%26,239 11% Prince of Whales Q 0%0 0%Q 0% Upper Lynn Canal 2,065 4%i]0%2,065 1% Total Region 340,200 30%0 0%340,200 6% Results of Integrated Cases -Sub-regionalSavings OPTIMAL DSM/EE,BIOMASS AND OTHER RENEWABLES CASE -SAVINGS RELATIVE TO STATUS QUO CASE Total Cumulative Net Present Value (CNPV)Savings __{$'000) Oil Space Heating Pius Biomass Utility System Plus DSM Costs()Costs Total $%$%$% SEAPA 221,430 49%418,993 43%640,423 45% Admiralty Island (22)0%9,592 43%9,570 32% Baranof Island 1,671 2%216,746 47%218,417 39% Chichagof Island 13,218 22%29,950 51%43,168 37% Juneau 185,117 50%977,503 46%1,162,620 47% Northern 33,670 38%77,923 53%111,593 47% Prince of Whales 3,313 14%180,036 49%183,349 47% Upper Lynn Canat 18,925 41%172,791 50%191,716 49% Total th Region 477,322 41%2,083,534 46%2,560,856 45% "Includes savings from generic hydro projects. 12/14/2011 25 Results of Integrated Cases -Sub-regionalSavings OPTIMAL DSM/EE,BIOMASS AND OTHER RENEWABLES CASE -SAVINGS RELATIVE TO OPTIMAL HYDRO/TRANSMISSION CASE Total Cumulative Net Present Value (CNPV)Savings (s'000) Oil Space Heating Plus Biomass Utility System Plus DSM Costs Costs Total $s %s %$% SEAPA 54,074 19%418,993 43%473,067 37% Admiralty Island (22)0%9,592 43%9,570 32% Baranof Island 1,473 2%216,746 47%218,219 39% Chichagof Island 5,284 10%29,950 51%35,234 32% Juneau 48,709 21%977,503 46%1,026,212 44% Northern 7,431 12%77,923 53%85,354 40% Prince of Whales 3,313 14%180,036 49%183,349 47% Upper Lynn Canal 16,860 38%172,791 50%189,651 48% Total h Region 137,122 17%2,083,534 46%2,220,656 42% IMPLEMENTATION RISKS AND ISSUES 12/14/2011 26 Resource Specific Risks and Issues DSM/€E Moderate Limited -Moderate Moderate Generation Resources Fuel Limited Limited Significant Moderate Limited Limited Moderate Significant Hydro Limited -Moderate N/A Moderate Moderate Limited -Limited LimitedModerateModerate Biomass Limited -Limited Moderate Limited N/A Limited-Limited Limited-Moderate Moderate Moderate Wind Moderate Moderate N/A Limited Significant Limited -Limited Limited - Moderate Moderate Geothermal Significant Limited -N/A Limited -Moderate -Limited -Limited Limited Moderate Moderate Significant Moderate Solid Waste Significant Moderate-N/A Significant Moderate Limited -Limited-ModerateSignificantModerateModerate Tidal/Wave Limited Significant N/A Significant Moderate -Moderate -Moderate -Limited - signi ignii ignit Moderate Coal Significant Moderate-Moderate Moderate Significant Modular Limited Significant Moderate Significant Moderate Significant Significant Moderate Nuclear Tramsmission Limited Significant N/A Moderate N/A Significant Moderate -N/A Significant CONCLUSIONS AND RECOMMENDATIONS 12/14/2011 27 Conclusions -General ¢Historical crossroad ¢Shortage of hydro storage capacity ¢"Achilles heel”-electric space heating conversions Significant uncertainties exist:loads,resources,potential transmission additions,and level of State financial assistance °Uncertainties lead to the need to: 'e Develop multiple options ¢Move towards a more balanced resource portfolio ¢Maintain flexibility Conclusions -Analysis and Results ¢Limitations due to quality and inclusiveness of project-specific information -this led to the need to base analysis on generic hydro projects -inability to make definitive selection ¢2 integrated cases: ¢Optimal hydro/transmission case ¢Optimal DSM/EE,biomass,other renewables case ¢Comparative results led to near-term resource selection ¢Committed Resources *DSM/EE "©Biomass conversions *Project feasibility studies to identify next increment of hydro (AEA developed process and standards,link with REGF) 12/14/2011 28 12/14/2011 Conclusions -Analysis and Results (continued) ¢Insufficient loads to justify expansion of transmission network ¢AK-BC Intertie is not economically viable under current conditions ¢Aggressive pursuit of DSM/EE delays need for incremental hydro Conclusions -Moving Forward ¢Two Phases 'PHASE £)[PHASE Sore,|*F(2012:2016):(2017 AND BEYOND Committed Resources fHDSM/EE Programs Vv Biomass Conversion Programs v Next Increment of Hydro and Other Vv Renewable Projects 29 Conclusions -Moving Forward (continued) ¢Preferred Resource Lists developed on Sub-regional basis,including Committed Resources |PROJECT |Discuss G =| Blue Lake Hydro The Blue Lake Hydro expansion will increase the capacity of the existingBlueLakeHydroProjectbyanestimated8MWandincreasetheaverageannualenergyfromtheprojectbyandapproximately34,500 MWh.TheBlueLakeHydroProjectislocatedinandwillbeownedbySitka, Gartina Falis Hydro 'The Gartina Falls Hydro project ts a new run-of-river project near Hoonahandwillprovideanestimated0.44 MWof capacity and approximately1,800 MWh of average annual energy. Reynolds Creek Hydro The Reynolds Creek Hydro project is a new storage project located near Hydaburg.The project will provide an estimated 5 MW of capacity and approximately 19,300 MWh of average annual energy.The project is Jointly owned by Haida Energy,inc.and AP&T and will provide capacity and energy to AP&T, Thayer Creek Hydro.The Thayer Creek Hydro project is a new run-of-river project located nearAngoon.The project will provide an estimated 1 MWof capacity andapproximately8,400 MWh of average annual energy.The project is currently owned by Kootznoowoo Inc. Whitman Lake Hydro.The Whitman Lake Hydro project is a new storage project located nearKetchikan.The project will provide an estimated 4.6 MWof capacityandapproximately15,900 MWhof average annual energy.The project isownedbyKetchikanPublicUtilities. Kake -Petersburg Intertie The Kake-Petersburg [ntertie will be a new 69 kV overhead and submarinecablelineKakeand i ly being by Kwaan Electric Transmission intertie Cooperative. -The Intertie will be new 34.5 kV overhead andIntertiesubmarinecablelinechikanand 'The interconnectioniscurrentlyownedandis being developedbytheMetlakatla{ndian Community. Conclusions -Moving Forward (continued) ¢Pursue policies to reduce electric space heating conversions ¢Potential impacts of mines ¢Need for State financial assistance ©Update IRP in 3 to 5 years 12/14/2011 30 Recommendations -Capital Projects ¢Sub-regional Preferred Resource Lists -Phase 1 "cto BY cxsounce! PHASE 1:COMMITTED RESOURCES 2012-2016 SBAPA Admiralty Island Baranof Island Chichagof Island Northern Prince of Wales. Kake-Petersburg Interconnection Ketchikan-Metiakatla Interconnection 'Whitman Lake Hydro Diesel DSM/EE Biomass 'Thayer Creek Project DSM/EE Biomass Blue Lake Hydro Diesel DSM/EE Biomass Gartina Falls Bydro Diesel DSM/£E Biomass Diesel DSM/EE Biomass Diesel DSM/EE Biomass Reynolds Creek Hydro DSM/EE Biomass 48.59 8.220 13.400) $1.06 3.07 139.40 13.0000 0.000) 0.76 ESTIMATED CAPIT,JRCTED-COMME!JE Eee 2015 2013 2014 2012-2016 2012-2016 2012-2016 2018 2022-2016 2012-2016 2015 2012-2016 2012-2016 2012-2016 2015 2012-2016 2012-2016 2012-2016 2012-2016 2012-2016 2012-2016 2012-2016 2012-2016 2012-2016 2014 2012-2016 2012-2016 Recommendations -Capital Projects ¢Sub-regional Preferred Resource Lists -Phase 2 UB-REGTO |}sesouace PHASE 2:RESOURCES 2017-2061 SEAPA Admiralty island Baranof Island Chichagof Prince of Wales Hydro Storage (10 MW} Diesel DSM/EE Biomass Diesel DSM/EE Biomass Diesel DSM/EE Biomass Hydro Run of River (1 MW) Diesel DSM/EE Biomass Hydro -Storage (10 MW) Diesel DSM/EE Biomass Hydro Storage (1 MW} Hydro -Run of River (1 MW) Diesel OSM/EE Biomass Diesel DSM/EE Biomass 193.13 202.82 102.06 165.96 1.66 0.07 0.74 83.41 3141 16.05 21.71 6.37 0.79 163 237.53 216.56 124.47 79.81 1855 32.84 23.31 131 468 16.62 66.35 10.23 2044 2017-2061 2017-2061 2017-2021 2017-2061 2017-2061 2017-2021 2017-2061 2017-2061 2017-2021 2035 2017-2061 2017-2061 2017-2021 2051 2017-2061 2017-2061 2017-2021 2017 2049 2017-2061 2017-2061 2017-2021 2017-2061 2017-2061 2017-2021 12/14/2011 31 Recommendations -Other ¢Public outreach program ¢Legislative decisions regarding level and form of financial assistance °AEA decision framework and policy ¢Appropriate funds for regional DSM/EE program ¢Appropriate funds for regional biomass conversion program ¢Evaluate regional entity to implement DSM/EE program ¢Evaluate regional entity to implement biomass conversion program Recommendations -Other ¢Appropriate funds for hydro/other renewables reconnaissance studies and FERC license applications ¢Technical/market potential study of non-hydro renewables ¢Support further development of tidal and wave power ¢Develop standard power sales agreement ¢Consider transmission open access policy ¢Update IRP in 2014-2015 °Evaluate rate structure changes *Develop weather normalized load forecasts ¢Streamline regulatory and permitting processes 12/14/2011 32 NEAR-TERM IMPLEMENTATION PLAN (2021-2014) Capital Projects --SEAPA Sub-region E APITAL PR rs$a | ' DEScRIPnOW Ferre|Mcocraldl Committed Resources e Kake-Petersburg Transmission Intertie (SEI-2)2013-2015 1,Estimated total cost -$48,590,000 2.Previous grants -$4,500,000 3.Remaining project cost -$43,100,000 «Ketchikan-Metlakatla Tr issi 2012-2013 Intertie (SEI-3) 4.Estimated total cost -$12,725,200 5.Previous grants -$4,500,000 6.Remaining project cost -$8,225,200 ©Whitman Lake Hydro 2012-2014 7.Estimated total cost -$25,200,000 8.Previous grants -$12,420,000 9,Remaining project cost -$12,780,000 Replacement of Existing Diesel Generation Facilities 2012 DSM/EE Programs 2012 2013 2014 Biomass Conversion Program 2012 2013 2014 SEAPA Sub-region Total (2012-2014) $43,100,000 $8,225,200 $12,780,000 $39,685,000 $69,100 $169,900 $395,300 $25,201,800 $26,393,100 $27,875,700 $183,895,100 12/14/2011 33 12/14/2011 Capital Projects Admiralty Island Sub-region c DESCRIPTIO!TIMEFRAME! Committed Resources ¢Thayer Creek Hydro 2012-2014 $13,000,000 1.Estimated total cost -$15,200,000 2.Previous grants -$2,200,000 3.Remaining project cost -$13,000,000 DSM/EE Programs 2012 $100 2013 $100 2014 $300 Biomass Conversion Program 2012 $144,000 2013 $108,600 2014 $249,500 Admiralty Island Sub-region Total (2012-2014)$13,502,600 Capital Projects -Baranof Island Sub-region !ECAPITAL PROJECTS ] foe Committed Resources e Blue Lake Hydro 2012-2014 $47,500,000 1.Estimated total cost -$96,500,000 2.Previous grants -$49,000,000 3.Remaining project cost -$47,500,000 DSM/EE Programs 2012 $100 2013 $100 2014 $300 Biomass Conversion Program 2012 $144,000 2013 $108,600 2014 $249,500 Admiralty Island Sub-region Total (2012-2014)$48,002,600 34 12/14/2011 Capital Projects -Chichagof Island Sub-region 'J "ESTIMATEDForme|Macca Committed Resources e Gartina Falls Hydro 2012-2014 $4,940,000 1.Estimated total cost -$5,790,000 2.Previous grants -$850,000 3.Remaining project cost -$4,940,000 Replacement of Existing Diesel Generation Facilities 2012 $303,500 DSM/EE Programs 2012 $600 :2013 $1,400 2014 $3,100 Biomass Conversion Program 2012 $313,700 2013 $417,000 2014 $327,400 Chichagof Island Sub-region Total (2012-2014)$6,306,700 Capital Projects -Juneau Area Sub-region [BEAPITAL PROJECTS J reread|Mazcoccaadl| Replacement of Existing Diese]Generation Facilities 2012 $20,220,000 DSM/EE Programs 2012 $82,200 2013 $201,500 2014 $468,800 Biomass Conversion Program 2012 $11,379,500 2013 $12,016,400 2014 $12,675,700 Juneau Area Sub-region Total (2012-2014)$57,044,100 35 12/14/2011 Capital Projects -Northern Sub-region {SCAP 3 Replacement of Existing Diesel Generation Facilities 2014 2012 2013 2014 DSM/EE Programs 2012 2013 2014 Biomass Conversion Program Northern Region Sub-region Total (2012-2014) Fieereavel|Mapcoscal $2,790,200 $900 $2,100 $4,700 $780,700 $749,200 $828,200 $5,156,000 Capital Projects -Prince of Wales Sub- region [BCAPITAL PROJECTSboomJ Committed Resources e Reynolds Creek Hydro 2012-2014 1 Estimated total cost -$28,580,000 2.Previous grants -$20,520,000 3.Remaining project cost -$8,060,000 DSM/EE Programs 2012 2013 2014 Biomass Conversion Program 2012 .2013 2014 Prince of Wales Sub-region Total (2012-2014) $8,060,000 $100 $100 $200 $1,339,800 $1,549,600 $1,757,100 $12,707,000 36 Capital Projects -Upper Lynn Canal Sub-region [BCAPITAL PR 'DESCRIPTION; DSM/EE Programs 2012 $3,500 2013 $8,700 2014 $20,500 Biomass Conversion Program 2012 $1,624,700 2013 $1,828,200 2014 $1,839,600 Upper Lynn Canal Sub-region Total (2012-2014)$5,325,200 Regional Supporting Studies and Other Actions i @ FSUPPORTING STUDIES AND OTHER ACTIONS@ B IMA' Descntrrion JEJEI General Public Outreach/Education Program 2012 $250,000 e Focused on:1)results of Southeast Alaska IRP project, 2)benefits of DSM/EE programs,and 3)benefits of biomass conversion program Regional DSM/EE Program Start-up Costs 2012-2013 $2,325,000 ©initial staff-related costs (e.g,salaries,benefits,office space)for first year of program start-up -$1,000,000 Customer attitudinal survey -$75,000 Market and economic potential study -$250,000 Detailed program plan -$500,000 Trade ally surveys and training/certification program -$150,000 DSM/EE measurement and evaluation protocol -$100,000 Start-up advertising program -$250,000 Regional Biomass Conversion Program Start-up Costs 2012-2013 $2,225,000 e Initial staff-related costs (e.g.,salaries,benefits,office space)for first year of program start-up -$1,000,000 Customer attitudinal survey -$75,000 Market and economic potential study -$250,000 Detailed program plan -$500,000 Trade ally surveys and training/certification program -$150,000 Start-up advertising program -$250,000 12/14/2011 37 Regional Supporting Studies and Other Actions(continued) gz ESUPPORTING STUDIES AND ai A ESTIMA'DESCRIPTIONS ]Sixco: Formation of Regional DSM/EE Entity Start-up Costs 2012 $500,000 ©Regional entity start-up costs (e.g.,organizational strategy,legal, etc.) Formation of Regional Biomass Conversion Entity Start-up Costs 2012 $500,000 ©Regional entity start-up costs (e.g.,organizational strategy,legal, etc.) Hydro Project-specific High Level Reconnaissance Studies 2012-2013 $2,000,000 ©20 studies at $100,000 each Hydro Project-specific FERC License Application Preparation 2012-2014 $10,000,000 *10 projects at $1,000,000 each Regional Technical /E ic Market P ial A ofNon-2012 $500,000 Hydro Renewable Technologies Other Renewable Project-specific High Level Reconnaissance 2012-2014 $1,000,000 Studies «5 studies at $200,000 each Support Tidal/Wave Technology Development 2012-2014 $1,000,000 Regional Supporting Studies and Other Actions(continued) |a bem Jka JES) Develop Standard Power Sales Agreement 2012 $200,000 Consider Development of Open Access Policy and Related Tariff 2012 $250,000 (including terms and conditions of service) Update Southeast Alaska IRP in 2014 2014 $750,000 Support Development of Tariff Structures That Better Reflect Costs 2012-2013 $1,550,000 «Develop and hold workshop(s)to address the issue that the last block in tariffs should better reflect incremental costs -$50,000 ¢Conduct cost-of-service studies for communities to determine what rates should be for the last block -$1,500,000 Support Development of Weather Normalized Load Forecasts 2013 $375,000 *Develop and hold workshop(s)to address need for,and approaches to,weather normalized load forecasting methodologies,which will b more important as heating becomes a bigger load -$50,000 ©Develop a standard load forecasting methodology -$75,000 «Develop short-term weather normalized load forecasts for each utility -$250,000 Total $23,425,000 12/14/2011 38