HomeMy WebLinkAbout2021-01-13 AEA Agenda and docs
813 West Northern Lights Boulevard, Anchorage, Alaska 99503 | P 907.771.3000 | Toll Free 888.300.8534 | F 907.771.3044 | WWW.AKENERGYAUTHORITY.ORG
REDUCING THE COST OF ENERGY IN ALASKA
Alaska Energy Authority
Board Meeting
Wednesday, January 13, 2021
8:30 AM
AGENDA
Dial 1 (888) 585-9008 and enter code 212-753-619# Public comment guidelines are below.
1. CALL TO ORDER 2. ROLL CALL BOARD MEMBERS 3. AGENDA APPROVAL 4. PRIOR MINUTES – December 9, 2020 5. PUBLIC COMMENTS (2 minutes per person) see call in number above 6. EXECUTIVE SESSION- Discuss confidential financial and legal matters. 7. NEW BUSINESS A. Resolution No. 2021-01 FY22 Operating and Capital Budget Submissions Ratification 8. OLD BUSINESS- NONE 9. DIRECTOR COMMENTS A. Response to Board Questions – NONE B. SSQ Line update – Permits C. Rural Assets and disposition D. Hydro Quarterly Update E. Renewable Energy Fund Update F. Denali Commission Update G. Rural update H. Power Project Fund Dashboard and Loan Report I. Community Outreach J. Articles of Interest K. Next Regularly Scheduled AEA Board Meeting Wednesday, March 3, 2021 10. BOARD COMMENTS 11. ADJOURNMENT
Public Comment Guidelines Members of the public who wish to provide written comments, please email your comments to publiccomment@akenergyauthority.org by no later than 4 p.m. on Tuesday before the meeting, so they can be shared with board members prior to the meeting. When calling in, you will enter the teleconference muted. After board roll call and agenda approval, we will ask callers to press *9 on their phones if they wish to make a public comment. This will initiate the hand-raising function. We will unmute callers individually in the order the calls were received. When an individual is unmuted, you will hear, “It is now your turn to speak.” Please identify yourself and make your public comments.
AEA Resolution No. 2021-01 FY22 Operating Budget & Capital Budget
Page 1 of 2
ALASKA ENERGY AUTHORITY
RESOLUTION NO. 2021-01
RESOLUTION OF THE ALASKA ENERGY AUTHORITY
RATIFYING GOVERNORS SUBMISSION OF FY22
OPERATING BUDGET & CAPITAL BUDGET
WHEREAS, the operating and capital budget of the Alaska Energy Authority (“the
Authority”) are subject to the Executive Budget Act;
WHEREAS, the FY22 operating and capital budget submissions for the Authority are
included in the Governor’s State operating and capital budget submissions to the Alaska State
Legislature (“the Legislature”) and are set out in Attachment A;
WHEREAS, the Governor’s State operating and capital budget submissions, including the
Authority’s operating and capital budget submissions, are subject to appropriation by the
Legislature; and
WHEREAS, the Board provides oversight for the Authority and its finances.
NOW, THEREFORE, BE IT RESOLVED BY THE ALASKA ENERGY
AUTHORITY AS FOLLOWS:
Section 1. The Authority’s FY22 operating and capital budget submissions are ratified
by the Board. The final FY22 operating and capital budget are subject to approval and
appropriation by the Legislature.
Dated at Anchorage, Alaska, this 13th day of January 2021.
Resolution No. 2021-01 Page 2
ATTEST
[SEAL]
Chair
Secretary
813 West Northern Lights Boulevard, Anchorage, Alaska 99503 T 907.771.3000 Toll Free 888.300.8534 F 907.771.3044
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
RGYAUTHORITY.ORG
MEMORANDUM
TO: Curtis Thayer
THRU: Kirk Warren
FROM: Betsy McGregor
DATE: January 4, 2021
RE: SSQ Line Permitting Update
This memo was prepared to provide an update on the right-of-way (ROW) permitting status for
the sale of the SSQ 115-kV and 69-kV transmission lines by Homer Electric Association, Inc.
(HEA) to the Alaska Energy Authority (AEA) from the Sterling Substation to the Quartz Creek
Substation. The purchase of the above line was fully consummated on December 17th, 2020.
USFWS – 22.94 miles
AEA was able to negotiate a clearing width of 100 feet for the entirety of the 115-kV line
segment (minus various river crossings wherein clearing is not required). The transfer of this
permit from HEA to AEA was fully executed on December 15, 2020. The permit expires October
31, 2058. The annual land use fee is $33,970.45 for the first year. A restoration plan for removal
of the remaining 16 miles of the 69-kV line will need to be developed and submitted to USFWS
early 2021.
USFS – 3.28 miles
The new USFS permit with AEA as the holder was fully executed on December 18, 2020. The
permit expires December 31, 2049. The annual land use fee is $2,789.87.
DNR – 0.16 miles
The transfer of assignee from HEA to AEA has been fully executed as of September 10, 2020.
There is no land use fee.
MHT – 0.13 miles
The transfer of assignee from HEA to AEA has been fully executed and recorded. AEA has been
issued a 30-year permit, with an annual land use fee of $1,250 beginning December 9, 2020.
KPB – 6.08 miles
The Assignment of Right-of-Way Interests to AEA was fully executed October 27, 2020 and
recorded in the Kenai and Seward recording districts. There is no land use fee.
Alaska Energy Authority Page 2 of 2
CIRI – 3.90 miles
CIRI has issued a letter of non-objection to the transfer of the Grantee rights from HEA to AEA
for the ROW permit on October 12, 2020 and is not charging a land use fee.
Other Private – 2.55 miles
The ROW on private lands are granted through a deed reservation, a right of way permit
serialized as ADL 38269, or an easement dedicated by plat. These are transferrable and do not
require a transfer of assignee for this transaction. There is no land use fee.
813 West Northern Lights Boulevard, Anchorage, Alaska 99503 T 907.771.3000 Toll Free 888.300.8534 F 907.771.3044
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
RGYAUTHORITY.ORG
TO: Curtis Thayer, AEA Executive Director
THROUGH: Kirk Warren, Director of Engineering and Energy Development
FROM: Ryan Garner, Program/Project Manager
DATE: December 22, 2020
RE: Disposition of Rural AEA Transmission Assets identified below:
1. Shugnak to Kobuk (S/K Line) – 10.5 miles
2. Craig to Klawock (C/K Line) – 5.5 miles
The Alaska Energy Authority (AEA) currently owns the two referenced transmission projects. The
Alaska Power Authority (APA), predecessor to AEA, managed the construction of the lines in
1981 and 1987 respectively, then later transferred the assets to AEA when APA was dissolved in
1993.
Current Status:
Within the past 12 months, both assets have had foundational documents which have expired.
AEA has been working with local stakeholder groups to update and/or renew these agreements.
In the case of the S/K Line, AEA and the landowner (Nana Regional Corporation, Inc.) have
completed a Right of Way Easement Agreement through the year 2046. In the case of the C/K
Line, AEA was contacted in February, 2020 by the utility responsible for operation of this asset
(Alaska Power & Telephone Company). The lease which was in place for this asset had expired
and AP&T was interested in amending and/or updated this lease. AEA is currently working with
AP&T to resolve these outstanding issues.
Disposition recommendation:
Both of the aforementioned assets are fully depreciated and have no book value. Both assets
are operated wholly by the local controlling interest. AEA does not receive revenue from these
assets and yet, as owner, retains inferred obligations to ensure these assets are used and useful
for their intended purpose. As such, AEA over the past 15 years has incurred costs in excess of
$60,000 in emergency response actions to undergo repairs when needed. The S/K Line has
been a topic of disposition discussions with the local utility (Alaska Village Electric Cooperative)
for an extended period of time. Very recent developments with other regional stakeholders
Alaska Energy Authority Page 2 of 2
have provided an opportunity to re-engage in these discussions in an expanded format. As for
the C/K Line, AEA staff were apprised of the lease issue described above in February. This was
the first instance that current AEA personnel responsible for infrastructure oversite, were aware
of AEA’s ownership interest in this asset. From that point on, AEA has put efforts into
researching and better understanding the history of the project.
AEA staff, in completing their research, have concluded that it is in the best interest of the State
to work with stakeholder groups in the communities served by these two assets and negotiate a
transfer of ownership to a competent local entity.
813 West Northern Lights Boulevard Anchorage, Alaska 99503 T 907.771.3000 Toll Free 888.300.8534 F 907.771.3044
REDUCING THE COST OF ENERGY IN ALASKA WWW.AKENERGYAUTHORITY.ORG
MEMORANDUM
TO: Curtis Thayer, Executive Director
Thru: Kirk Warren, P.E., AEA Director, Engineering & Energy Development
FROM: Bryan Carey, P.E., Owned Assets Manager
DATE: January 4, 2021
SUBJECT: December Monthly Hydroelectric Program Update
Update
Currently Four Renwable Energy Fund (REF) hydroelectric related projects (Thayer Lake/Creek,
Metlakatla Transmission, Gunnuk Creek, and FiveMile Creek) are active and have REF
construction funds. In addition, one Power Project Fund project Hiilangaay Hydroelectric Project
and one owned hydroelectric project Bradley Lake Hydroelctric Project are active. A monthly
update of these Projects and a programmatic summary follows.
Bradley Lake Hydroelectric Project (Owned)
Bradley Lake Hydroelectric Project is located northeast of Homer, Alaska.
Turbine #1 was shut down and dismantled at the start of November because of an oil leak.
Project was estimated at $700,000 to replace seals for both turbines. However, once opened,
unexpected corrosion of the piston was noted which will require a new finish. The contractor
working at Bradley is not working through the holidays however work is proceeding on the
metal re-finish. Once the operator has revisied cost estiamtes they will be provided to AEA and
the utilities.
Unit #1 is expected to be back on line in Janaury. Once Unit #1 back online then Unit #2 will be
shut down and opened up to replace seals. The operator is working closely and collaboratively
with Bradley participants and AEA.
Fivemile Creek Hydroelectric Project (REF) #7091226
FiveMile Creek Project is located at Chitina, Alaska (on road to McCarthy).
Design Request For Proposal is currently being advertised. CM/GC RFP will follow. Designer,
AEA, and Construction Manager will work together to quickly design project and manage costs.
REF grant $3.4 million to go with Denali Commission grant of $2.88 million.
Gunnuk Creek (REF) #7091244 –End Date 12/31/20.
Gunnuk Creek is located next to the community of Kake, Alaska on Kupreanof Island in
southeast.
Project achieved substantial completion in September 2020. Final cost ~$8.8m. AEA REF grant
was $3.92 m. Remainder of project funded by utility grants and funds. Grant being closed as
scheduled.
Hiilangaay Hydroelectric Project (Power Project Fund)
Hiilangaay Hydroelectric Project is located on Prince of Wales Island east of Hydaburg.
AEA has received notice of Substantial Completion. Final completion will be March 2021.
Regular progress meetings have been cancelled however, special meetings on specific topics will
be held as needed.
AEA loan was for $20 million to be repaid over 46 years. Haida Energy started making
quarterly payments on the loan in April of 2020. Current payments are $108,695.65. In April or
2026 payments will go to $275,000 per quarter. The November 2020 Monthly Construction
Report to FERC had Original budget $18,495,652 and revised final cost estimate (Spring 2021) of
$31,267,209.
Metlakatla Transmission (REF) #2195429 & #7040068 Ending 12/31/20.
Metlakatla is located on Annette Island southwest of Ketchikan in southeast Alaska.
Design work is being completed. Grantee is spending a majority of time on business plan
development. An intertie would connect Metlakatla and Ketchikan Public Utilities (KPU).
Historically Metlakatla has been self sufficient for energy but an intertie would improve
reliability. Last cost estimate was completed in February 2018 and $6.8 million was needed for
construction. REF granted $2 million. Remaining granted funds ~$0.5 million.
Thayer Lake (REF) #7040038 (closed) & 7050825 – End date 12/31/20 Req 3/31/21.
Thayer Lake is located on Admiralty Island near Angoon, Alaska west of Juneau in southeast
Alaska.
Grantee has requested a grant extension through March 31, 2021 due to Covid-19 impacts.
Final design, cost estimate, & permit applications were provided at the end of December.
Grantee has a near final lease agreement with Inside Passage Electric Cooperative (IPEC) for the
design, construction, and operation of the project. IPEC is supporting this project with time &
funds. Construction cost estimate of project is $16 million. REF granted (design) ~$2.3 million.
Unobligated REF funds $5.7 million.
Because of difficulties obtaining disparate grants executed concurrently, the grantee would like
to break construction up in phases with REF grant being available for each phase, as a percent of
total project cost estimate. Grantee has a new President that will be taking over this project.
IPEC is awaiting word from Rural Utility Service on a funding request which would cover a
substantial portion of proposed Phase I work. Cost estimate for Phase 1 work is $7.7 million.
Combined RUS, REF, and other funds would enable Phase I work to proceed.
813 West Northern Lights Boulevard, Anchorage, Alaska 99503 T 907.771.3000 Toll Free 888.300.8534 F 907.771.3044
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
TO:
THRU
FROM:
DATE:
RE:
MEMORANDUM
AEA Board of Directors
Curtis W. Thayer, Executive Director
Conner T. Erickson, Economist
December 31, 2020
REF Grant Program Update
On July 20, the AEA posted the Renewable Energy Fund Grant program’s 2020 Request for
Applications (RFA), with a closing date of September 28th. As of the closing date, AEA received a total of 21 applications. These applications comprised a total of $12.8 million in grant funds
requested. Upon the initial stage 1 - Applicant and Project Eligibility review of the applications,
it was determined that five applications were ineligible or late in their submission. The
applicants were notified of AEA’s determination that their applications did not pass stage 1.
Two appeals were received from the applicants. Upon AEA’s due consideration and review of
the appeals, both were rejected, and final written notices issued. Owing to the rejection of these five applications, total grant funds requested were reduced to $10.8 million per the remaining 16 applications.
The AEA as part of its stage 2 – Technical and Economic Feasibility review, in conjunction with cost-benefit analysis and peer review work conducted by contracted economists, determined that a further five applications were not recommended. Determination of non-recommendations were made per REF statutes and regulations (AS 42.45.045, 3 AAC 107.600-695), and per section 4 of the RFA. The impacted applicants were notified in writing of their non-recommendation. Three appeals were received with a fourth applicant still eligible to appeal until December 31st. Upon receipt of the appeals, and after a thorough review of the applicants’ applications and supporting documentation, the three appeals were rejected. The applicants were notified in writing of AEA’s final determination of non-recommendation. Owing to these non-recommendations, total grant funds requested have been further reduced to $6.7 million.
11 applications remain and have been attributed a ranking as per stage 3 of the REF process and
as set forth in 3 AAC 107.655. As per regulation 3 AAC 107.655, AEA in its REF stage 3 review,
has recommended partial funding for two of the remaining applications. All remaining
applications are currently in the process of being ranked at a regional and statewide level, and
regionally balanced with respect to past REF funding rounds as per stage 4 of the REF process,
and per the ranking criteria in accordance with 3 AAC 107.660.
Alaska Energy Authority Page 2 of 2
AEA Executive Director, Mr. Curtis Thayer, is pursuing through the Governor’s office, the appointment of members of the Renewable Energy Fund Advisory Committee (REFAC) for this current REF round. Upon the appointment of the REFAC, the AEA will submit its recommendations for funding of the remaining 11 applications to the committee for their review. The current total grant request amount for the remaining applications, to be submitted to REFAC, is $4.7 million. Following REFAC guidance AEA will, in late January, submit its analysis and report to the legislature for its decision on funding the applications submitted and evaluated during Round XIII of the REF process.
For reference, the remaining 11 applications are comprised of 1 biomass heat application, 1 heat
recovery application, 3 hydroelectric applications, 1 storage application, and 5 wind energy
applications. The regional distribution of the remaining applications is as follows per AEA’s
energy development classifications - 2 Bristol Bay ($1.1M total), 3 Lower Yukon-Kuskokwim
($473k total), 1 Yukon-Koyukuk/Upper Tanana ($650k total), 1 Aleutians ($139k total), 1
Southeast ($461k total), 2 Northwest Arctic ($1.6M total), and 1 Copper River / Chugach ($294k
total).
Award No Project Name DC Funding Perf. Period Beg Perf. Period Thru Actions Since Last Report
Estimated Jobs
Created
01349-09 RPSU - Togiak-Twin Hills Intertie 4,187,221 2/15/2011 9/30/2021 None 26
01432-09 BFU - Tatitlek 1,472,000 6/1/2013 12/31/2021 None 30
01474-07 BFU - Chalkytsik 517,500 6/16/2015 12/31/2021 None 30
01485-04 START Communities Tech Asst 375,000 11/1/2015 6/30/2022 None 2
01492-08 BFU - Beaver 608,000 7/6/2016 12/31/2021 None 5
01500-06 Bulk Fuel Operator Training 1,010,000 9/1/2016 12/31/2021 None 3
01515-07 Circuit Rider Program 900,000 1/1/2017 12/31/2021 None 3
01516-07 RPSU - Maintenance & Improvement 748,776 10/1/2016 12/31/2022 None 20
01523-06 Miscellaneious Small M&I Projects 870,000 6/1/2017 12/31/2021 None 20
01525-05 Power Plant Operator Training 647,514 8/15/2017 9/30/2021 None 3
01544-03 Itinerant Utility Training 500,000 3/1/2018 6/30/2021 None 3
01548-06 RPSU M&I - Statewide 2,550,000 5/1/2018 12/31/2021 None 20
01549-04 RPSU Inventory & Assessment - Statewide 300,000 4/18/2018 12/31/2021 None 20
01550-03 RPSU - Akhiok 1,500,000 5/1/2018 9/30/2021 None 26
01551-04 RPSU - Venetie 250,000 5/1/2018 12/31/2020 None 5
01557-02 Barge Headers and Fill Lines 3,976,820 10/1/2018 12/31/2022 None 60
01571-01 BFU - Nunapitchuk 3,522,546 8/15/2019 12/31/2022 None 30
01573-01 BFO In Community Training 40,000 8/15/2019 12/31/2020 None 2
01574-01 RPSU - Nikolai 351,050 8/1/2019 6/30/2021 None 5
01575-02 RPSU - Nelson Lagoon 135,455 8/1/2019 6/30/2021 None 5
01576-02 RPSU - Rampart 351,050 8/1/2019 9/30/2021 None 5
01577-03 RPSU - Napaskiak 335,455 8/1/2019 12/31/2021 None 26
01592-00 BFU - Scammon Bay 300,000 2/17/2020 3/31/2021 None 5
01600-00 VEEP - Statewide 500,000 6/15/2020 12/31/2021 None 3
01610-01 BFU - Ekwok 100,000 9/1/2020 9/30/2021 None 30
01611-00 Engineering Library 100,000 9/1/2020 6/30/2022 None 1
01618-00 Fivemile Creek Hydroelectric Project 2,880,000 9/1/2020 12/31/2022 None 65
01628-00 Craig High School Biomass Project 440,417 11/1/2020 12/31/2021 None 8
Total Funding for Active DC Awards:29,468,804
Less Total Spending on Active DC Awards:(13,084,594)
Total Funding Remaining on Active DC Awards:16,384,210
Active Denali Commission Awards
As of 12/30/2020
813 West Northern Lights Boulevard, Anchorage, Alaska 99503 T 907.771.3000 Toll Free 888.300.8534 F 907.771.3044
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
AEA Rural Program & Project Highlights
1/13/21 AEA Board Meeting
Denali Commission Funding
Denali Commission (DC) funding for State FY21-22. AEA was successful in obtaining an approximately 5 million in program and project funding
commitment primarily for rural programs and projects such as Energy Reliability, Bulk Fuel Security, Workforce and Economic Development, Circuit Ryder and
Training. These funds are leveraged by matching State funding for capital projects at a 20% State to 80% DC. The Denali Commission is the primary federal
funding partner for AEA rural programs
Rural Power System Upgrade (RPSU) - Inventory and Assessment
The Inventory and Assessment project is continuing to progress well. Completion is anticpated in the second quarter of 2021. This project will be the basis for
project priority lists for rural programsas required by 3 AAC 108.110
Major Projects in Design
Rural Power System Upgrades (RPSU)
• Rampart construction planned for FY22-23
• Nikolai construction planned for FY22-23
• Nelson Lagoon construction planned for FY23-24
• Napaskiak construction planned for FY23-24
Bulk Fuel Upgrades (BFU)
• Ekwok
• Scammon Bay
• Shageluk
• Marshall
Alaska Energy Authority Page 2 of 2
AEA Active Rural Projects
$20,407,022
$24,373,751
$4,718,857
$3,113,898
Active Projects Total Budgeted
BFU RPSU Training Circuit Rider
15
52
8
85
Total Active Projects
BFU RPSU Training Circuit Rider
AEA LOAN DASHBOARD REPORT
AEA POWER PROJECT LOAN FUND
YEAR TO DATE
07/01/2020 LOAN ACTIVITY EARNINGS
START DATE LOAN CATEGORY STARTING
BALANCE
FUNDS
DISBURSED
PAYMENTS
RECEIVED
ENDING
BALANCE
INTEREST
RECEIVED
LATE FEES
RECEIVED
INTEREST +
LATE FEES
20 AEA POWER PROJECT FUND LOANS 27,560,262 624,763 (216,026) 27,968,999 110,244 1,562 111,806
TOTAL # OF PPF LOANS
1 LOAN PROGRAM SUMMARY
# OF DELINQUENT PPF
LOANS Outstanding Loans per Trial Balance 27,966,827.10$
43,435.42$ Uncommitted Cash Balance 10,374,806.64$
LOANS DELINQUENT
AMOUNT ($)Loan Commitments 338,529.01$
0.143%Total Loan Program 38,680,162.75$
% OF DELINQUENT
LOANS TO PORTFOLIO
BALANCE
11/30/2020
END DATE
FISCAL YEAR-TO-DATE LOAN PORTFOLIO ACTIVITY (07/01/2020 - 11/30/2020 )
Waterfall Creek Hydro - King Cove, Alaska
Print Date: 12/11/2020
Page 1 of 2
AEA POWER PROJECT FUND LOANS BY ENERGY REGION & PROJECT TYPE
OUTSTANDING BALANCES & NEW ACTIVITY
ENERGY REGION AEA PPF LOAN
BALANCE
REMAINING
LOAN
COMMITMENTS
NEW
APPLICATIONS
IN PROCESS
# OF AEA PPF
LOANS TOTAL
ALEUTIANS 2,552,026 - 65,000 4 2,617,026
BERING STRAITS - - - - -
BRISTOL BAY 456,312 - 514,500 2 970,812
COPPER RIVER/
CHUGACH - - - - -
KODIAK 38,000 - - 1 38,000
LOWER YUKON-
KUSKOKWIM 346,665 - - 2 346,665
NORTH SLOPE - - - - -
NORTHWEST ARCTIC - - - - -
RAILBELT 4,046,527 - - 3 4,046,527
SOUTHEAST 20,332,633 294,926 - 3 20,627,559
27893070.2 YUKON-KOYUKUK/
UPPER TANANA 194,664 43,603 4,083,114 5 4,321,381 10422145.37
58569.36 27,966,827 338,529 4,662,614 20 32,967,970 TOTAL
BIOMASS
$99,148
CONSERVATION
$0DIESEL
$942,097
HYDRO
$24,480,926
SOLAR
$793,226
TRANSMISSION
$1,824,285
TANK FARM
$2,258,829
WIND
$2,569,459
AEA PPF LOANS BY PROJECT TYPE -NEW & OUTSTANDING BALANCE
BIOMASS
1
CONSERVATION
0
DIESEL
5
HYDRO
7
SOLAR
1
TRANSMISSION
1
TANK FARM
1
WIND
4
AEA PPF LOANS BY PROJECT TYPE
Print Date: 12/11/2020
Page 2 of 2
813 W Northern Lights Blvd., Anchorage, AK 99503 Phone : (907) 771 -3000 Fax : (907) 771 -3044 Email : info@akenergyauthority.org
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
RGYAUTHORITY.ORG
AEA Community Outreach Engagement
Updated on January 4, 2021
# DATE DESCRIPTION AEA STAFF / PR TOOL
1. To Be Determined, 2021 Bethel Chamber of Commerce Curtis W. Thayer
2. To Be Determined, 2021 Greater Palmer Chamber of Commerce Curtis W. Thayer
3. February 4, 2021 Alaska Power Association 2021 Virtual Legislative Conference Curtis W. Thayer
4. December 30, 2020 Radio Interview with KUAC FM 89.8 in Fairbanks Curtis W. Thayer
5. December 18, 2020 The Alaska Energy Authority is helping prepare the Railbelt for tomorrow Op-ed
6. December 18, 2020 Media Inquiry on Rural Energy Systems by Alaska Business Curtis W. Thayer
7. December 17, 2020 AEA Completes Acquisition of HEA’s 115-kV Transmission Line Press Release
8. December 10, 2020 Denali Commission, U.S. Forest Service, and AEA Announce Over $1 Million
in Funding for Biomass Projects in Rural Communities Press Release
9. December 8, 2020 AIDEA & AEA Presentation to City of Seward (with Alan Weitzner) Curtis W. Thayer
10. December 3, 2020 Media Inquiry on Renewable Energy Projects by Scienceline Curtis W. Thayer
11. November 12, 2020 Pumped Hydro Presentation to Office of Indian Energy Bryan Carey
AEA Community Outreach Engagement Page 2 of 2
# DATE DESCRIPTION AEA STAFF / PR TOOL
12. October 23, 2020 Media Inquiry on PCE by Alaska’s News Source Curtis W. Thayer
13. October 22, 2020 Media Inquiry on PCE by Ketchikan Daily News Curtis W. Thayer
14. October 6, 2020 FY22 Budget Development Presentation to Governor Curtis W. Thayer
15. October 1, 2020 FY22 Budget Development Presentation to Office of Management & Budget Curtis W. Thayer
16. September 23, 2020 2020 Virtual Southeast Conference Annual Meeting: Energy Committee Curtis W. Thayer
17. September 18, 2020 Media Inquiry on Alaska Cargo & Cold Storage by Alaska’s News Source Curtis W. Thayer
18. September 16, 2020 AEA Awarded $21 Million BUILD Grant for Anchorage Airport Project Press Release
19. September 2, 2020 Congressman Don Young Visits AIDEA & AEA Office Curtis W. Thayer
20. August 31, 2020 Lower Kuskokwim 2020 Virtual Power Pledge Challenge Taylor Asher
21. August 27, 2020 AEA Completes Battle Creek Diversion Project at Bradley Lake Hydro Press Release
22. August 6, 2020 AEA Board Supports Purchase of Soldotna-Quartz Creek Transmission Line Press Release
23. July 28, 2020 Fairbanks Economic Development Corporation: Energy for All Alaska Task Force Curtis W. Thayer
24. July 22, 2020 Fairbanks Chamber’s Energy, Environment & Natural Resources Committee Kirk H. Warren
25. July 20, 2020 Application Period Opens for Renewable Energy Fund Grants Press Release
813 W Northern Lights Blvd, Anchorage, AK 99503 • Phone: (907) 771-3000 • Fax: (907) 771-3044 • Email: info@akenergyauthority.org
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
RGYAUTHORITY.ORG
PRESS RELEASE
Brandy M. Dixon
Public Engagement Officer
(907) 771-3078
FOR IMMEDIATE RELEASE
December 17, 2020
AEA Completes Acquisition of Homer Electric Association’s 115-kV Transmission Line
Railbelt benefits include better cost alignment and potential future upgrade
(Anchorage) – The Alaska Energy Authority (AEA) today has completed its previously announced
acquisition of a Homer Electric Association (HEA) transmission asset for $17 million that runs
between the Sterling Substation and the Quartz Creek Substation (SSQ Line) on Kenai Lake.
"This acquisition furthers AEA’s mission to reduce the cost of energy in Alaska," said AEA Board
Chair Dana Pruhs. "The addition of these assets results in the SSQ Line becoming part of AEA’s
Bradley Lake Project with better cost-alignment and will facilitate upgrades benefiting Alaska
ratepayers."
The SSQ Line is a critical component of the Railbelt transmission system. The 39.3 miles of 115-
kilovolt transmission line delivers Bradley Lake hydroelectric generated power, the least
expensive power available to Railbelt ratepayers, from HEA’s grid to transmission lines linked to
all the other Railbelt utilities. In the summer of 2019, the SSQ Line was a key line out-of-service
for an extended time after receiving damage during the Swan Lake Fire. It took four months to
bring the line back into service costing an estimated $12 million to Railbelt Utility ratepayers.
"This purchase marks a pivotal moment in the history of our partnerships," said AEA Executive
Director Curtis W. Thayer. "The transaction brings significant benefits to customers today and
into the future – including better cost alignment, increased reliability, and future prospect for
upgrades to the line, which would decrease line losses and allow for increased power
transmission north, and unconstraining Bradley power."
"This transmission line is key in delivering consistently low-cost renewable hydroelectric power
to some of the largest population centers in the state," noted Tony Izzo, Chair of the Bradley
Lake Project Management Committee and CEO of Matanuska Electric Association. "We
applaud the Alaska Energy Authority's leadership in partnering with the utilities to provide
energy security and stabilize costs for ratepayers throughout the region."
Located near Homer, Bradley Lake is the largest hydroelectric project in Alaska and has the
capacity to generate up to 120 megawatts of electricity – roughly the amount of energy needed
to power a city the size of Fairbanks. With the SSQ Line under AEA ownership, AEA has an
opportunity to upgrade the line to benefit Railbelt utility customers.
The Alaska Energy Authority is a public corporation of the State of Alaska governed by a board
of directors with the mission to “reduce the cost of energy in Alaska.”
###
813 W Northern Lights Blvd, Anchorage, AK 99503 Phone: (907) 771-3000 Fax: (907) 771-3044 Email: info@akenergyauthority.org
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
RGYAUTHORITY.ORG
PRESS RELEASE
Brandy M. Dixon
Public Engagement Officer
(907) 771-3078
FOR IMMEDIATE RELEASE
December 10, 2020
Denali Commission, U.S. Forest Service, and AEA Announce Over
$1 Million in Funding for Biomass Projects in Rural Communities
(Anchorage) – The Alaska Energy Authority (AEA), along with Federal partner agencies
the Denali Commission and the U.S. Forest Service, announce a cooperative effort to
invest $1,037,000 with over $400,000 in community matching funds in state-of-the-art
district wood heating systems in three rural Alaska communities.
“We are happy to continue our long-standing partnership with the Denali Commission
and the U.S. Forest Service that through our combined efforts promote renewable
energy projects in Alaska and bring benefits to the communities of Mentasta Lake, the
Native Village of Kluti-Kaah, and Craig,” said AEA Executive Director Curtis W. Thayer.
“This support from our partners in benefitting these and other rural communities in the
future is an endeavor we undertake with hope and a good deal of pride. The energy that
comes from this cooperative effort is felt within each organization.”
The biomass projects funded under this partnership include the building of a wood chip
heating system for the Mentasta Traditional Council, phase 1 construction of a
woodchip district heating system for the Native Village of Kluti-Kaah, and fabrication of
a wood-fired boiler for the Craig City School District’s High School Campus.
Biomass systems are renewable energy resources that help keep money in the local
communities (or economies), displace fossil fuels, and provide local jobs. Because most
of the wood used for these systems is waste it supports wildfire mitigation efforts, as
well as helps to provide fire breaks while heating community buildings.
The projects are scheduled to be completed by December 31, 2021.
The Alaska Energy Authority is a public corporation of the State of Alaska. Its mission is
to reduce the cost of energy in Alaska.
###
bonds in place dedicated to plugging and
abandonment and for bonds in place with
the U.S. Environmental Protection
Agency for P&A of disposal wells.
Terms for installment payments are
also extended.
“Amaroq continues to be supportive of
AOGCC’s efforts to adopt regulations on
bonding that give consideration to unique
circumstances facing each operator,” G.
Scott Pfoff, president of Amaroq
Resources, told the commission in Nov.
19 written comments.
Pfoff said the proposed changes fail to
recognize the Alaska Department of
Natural Resources dismantlement,
removal and restoration agreement that
requires an operator to fund the estimated
cost of both surface reclamation and
plugging and abandonment of wells, and
asked the commission “to find a way to
coordinate its bonding requirements with
the DNR in such a way as to avoid
duplicative financial coverage for plug-
ging and abandonment.”
Pfoff said spreading out annual pay-
ments on the increased bonding costs
from 4 to 7 years has only marginal ben-
efits for Amaroq as the minimum first
installment is $500,000. “Amaroq’s abili-
ty to make the first installment would be
questionable,” he said.
In Nov. 20 comments, Patrick N.
Bergt, regulatory and legal affairs manag-
er for the Alaska Oil and Gas Association,
said “AOGA commends AOGCC for its
efforts to update and modernize the bond-
ing requirements” and supports proposed
changes.
“Adding a category for 6-20 wells in
the permitted wellheads bond amount
table will work to increase opportunity in
Alaska and, together with the proposed
changes to the payment schedule, helps
smaller operators shoulder financial bur-
dens resulting from recent developments
in the global oil and gas markets.”
Bergt said AOGA supports reductions
when the operator has a bond in place
with the landowner dedicated exclusively
to plugging and abandonment, but said
AOGA suggests a further modification so
that the requirement is that the operator
have a “bond, cash deposit, or other
acceptable form of security in place with
the landowner, or other affected party”
dedicated to P&A.
The commission also received com-
ments Nov. 20 from Tim Jones, land man-
ager for Oil Search (Alaska).
“As a lease holder and operator on the
North Slope, OSA supports clear and rea-
sonable bonding requirements,” Jones
said.
In October 2018, OSA provided com-
ments to the previously proposed
changes, and Jones said the company is
encouraged “that AOGCC is proposing
revisions that are consistent with changes
suggested in OSA’s October 2018 com-
ments,” namely increasing or decreasing
a bonding obligation based on “engineer-
ing, geotechnical, environmental, or loca-
tion conditions,” on a “bond or other
security required by a landowner” and on
“bonding or other security required by the
U.S. Environmental Protection Agency to
address disposal wells.”
The commission received comments
from Furie Operating Alaska/HEX at its
Nov. 4 hearing and in a Nov. 2 letter.
Rick Dusenbery, the company’s chief
operating officer, said in the letter that
while the company supports the additions
to the section on reasons it may increase
or decrease bonding amounts, and the
extension of the payment period for addi-
tional bonding, “we still feel that this
level of bonding is counterproductive to
exploration and development in the Cook
Inlet during these economically dis-
tressed times.”
The letter also requested bonding
reduction based on other bonds or securi-
ties in place, including DNR’s DR&R
bonding.
—KRISTEN NELSON
PETROLEUM NEWS • WEEK OF DECEMBER 6, 2020 7
At Flowline Alaska, we’ve spent decades helping to
ŬĞĞƉŽŝůŇŽǁŝŶŐŽŶƚŚĞEŽƌƚŚ^ůŽƉĞ͘
/ƚ͛ƐĂƌĞĐŽƌĚǁĞ͛ƌĞƉƌŽƵĚŽĨ͕ĂŶĚǁĞůŽŽŬĨŽƌǁĂƌĚ
ƚŽĂĨƵƚƵƌĞǁŚĞƌĞǁĞĐĂŶƉƌŽǀŝĚĞƚŚĞƐĞƌǀŝĐĞĂŶĚ
ƐƵƉƉŽƌƚŶĞĐĞƐƐĂƌLJƚŽŐƌŽǁĂŶĚĞdžƉĂŶĚůĂƐŬĂ͛Ɛ
ĞŶĞƌŐLJŝŶĚƵƐƚƌLJ͘
ĞĐĂƵƐĞǁĞǁĂŶƚƚŽŬĞĞƉůĂƐŬĂ͛ƐŽŝůŇŽǁŝŶŐ͕
today and tomorrow.
ŇŽǁůŝŶĞĂůĂƐŬĂ͘ĐŽŵ
(907) 456-4911
We know pipes.
Inside and out.
ALTERNATIVE ENERGY
Next steps for Makushin geothermal project
Ounalashka Corp. and Chena Power are moving ahead with a project to devel-
op a geothermal energy system, to obtain electrical power from the Makushin
Volcano on Unalaska Island. The idea is to establish a local, renewable source of
electricity for the island, including the City of Unalaska. Ounalashka Corp. is the
Alaska Native village corporation for Unalaska. Chena Power installed and oper-
ates the Chena Hot Springs geothermal power plant in the Alaska Interior.
Ounalashka and Chena have announced that they have selected Power
Engineers, an international renewable energy company based in Hailey, Idaho, as
the engineering company for the project. Electric Power Systems of Anchorage,
Alaska, will assist in assessing whether the existing Unalaska power grid is strong
and resilient enough handle the anticipated power output from the Makushin facil-
ity. The assessment will identify any necessary infrastructure improvements and
associated costs.
In addition, Ounalashka and Chena have commissioned a cost-benefit analysis
for the conversion of Unalaska homes and businesses to the use of electrically
powered heat pumps for the heating of buildings. The evaluation project will
include the conversion of some selected buildings to heat pump use at no cost to
the owners.
The development of the 18 to 30 megawatt geothermal plant will involve the
installation of roads, pads and facilities. A buried transmission line will transport
power to the City of Unalaska power grid. The developers envisage the drilling of
three production wells and two injection wells to depths of about 2,000 feet.
—ALAN BAILEY
US drilling rig count up by 10 to 320
The Baker Hughes U.S. rotary drilling rig count increased by 10 to 320 on Nov.
25, a count early in the week due to Thanksgiving. The count had dropped by two the
week ending Nov. 20, only the second such reversal in a gradual increase that began
in mid-August. The count is still down substantially from a year ago, by 482 from 802.
When the count hit 244 the week of Aug. 14, it was not just the low for 2020, but
the lowest it has been since the Houston based oilfield services company began issu-
ing a weekly U.S. rig count in 1944.
Prior to this year, the low was 404 rigs in May 2016. The count peaked at 4,530 in
1981.
At the beginning of the year the count was in the low 790s, where it remained
through mid-March, when it began to fall, dropping below what had been the historic
low in early May with a count of 374 and continuing to drop through the third week
of August when it gained back 10 rigs.
The Nov. 25 count includes 241 rigs targeting oil, up 10 from the previous week
but down 427 from a year ago, 77 rigs targeting gas, up one from the previous week
but down 54 from a year ago and two miscellaneous rigs, down one from the previous
week and down one from a year ago.
Twenty-two of the holes were directional, 283 were horizontal and 15 were
vertical.
Alaska count unchanged
There were three-rig gains recorded in three states: California (7), New Mexico
(58) and Texas (147).
Colorado (5) and Louisiana (39) were each up by one rig.
Rig counts were unchanged in the remaining states: Alaska (3), North Dakota (11),
Ohio (4), Oklahoma (13), Pennsylvania (20), Utah (3), West Virginia (7) and
Wyoming (2).
Baker Hughes shows Alaska with three active rigs Nov. 25, unchanged from the
previous week but down by four from a year ago.
The rig count in the Permian, the most active basin in the country, was up by five
from the previous week at 161, but down 244 from a count of 405 a year ago.
—KRISTEN NELSON
EXPLORATION & PRODUCTION
GOVERNMENT
CINGSA latest to ask for bond reduction
The Alaska Oil and Gas Conservation Commission has denied another request for
bond reduction based on the existence of a dismantlement, removal and restoration
bond with the Alaska Department of Natural Resources.
The latest petition for a reduction in bonding amount came in October from Cook
Inlet Natural Gas Storage Alaska, CINGSA.
CINGSA has five permitted wellheads at its Kenai Peninsula gas storage facility.
The commission notified CINGSA in July 2019 that based on its five wellheads,
its bonding requirement would increase to $2 million under AOGCC’s new bonding
regulations. CINGSA had a $200,000 bond in place, so the commission required an
additional $1.8 million.
In its request for reconsideration of its bond amount, CINGSA said it has increased
its $200,000 bond: in 2019, to $700,000; in July of this year, to $1 million; and in
August of this year, to $1.2 million.
CINGSA proposes to increase its bond to $1.5 million in August 2022, “at which
point, provided this request for reconsideration is granted, it will have fulfilled its
AOGCC-related bonding requirements,” the company said.
In a Nov. 30 decision the commission denied the request for reconsideration, say-
ing that the $500,000 DR&R bond with DNR is a bond to return DNR’s leases to a
condition acceptable to that agency.
“As of the date of this order, no evidence has been offered that any of the DNR
bond is exclusively dedicated to the costs to properly plug and abandon CINGSA’s
wells. CINGSA’s bonding amounts will not be reduced by the amount of the DNR
DR&R bond.”
The commission acknowledged that CINGS currently has bonding with AOGCC
at $1.2 million and said “CINGSA’s revised bond required an additional $800,000.”
—KRISTEN NELSON
continued from page 1
BONDING REGS In Nov. 20 comments, Patrick N.
Bergt, regulatory and legal affairs
manager for the Alaska Oil and
Gas Association, said “AOGA
commends AOGCC for its efforts
to update and modernize the
bonding requirements” and
supports proposed changes.