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2023-10-25 AEA Agenda and docs
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 Alaska Energy Authority Board Meeting Wednesday October 25, 2023 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 – September 22, 2023 5. PUBLIC COMMENTS (2 minutes per person) see call in number above 6. NEW BUSINESS A. FY23 Audit B. Power Project Loan (PPF) Application – Makushin C. AEA Board Meeting Dates - 2024 7. OLD BUSINESS - None 8. DIRECTOR COMMENTS A. Responses to Board Questions from September Board Meeting B. IIJA / IRA Grant Funding Update • Solar For All C. Governor’s State Energy Security Task Force Update – DRAFT Report D. Electric Vehicle Update E. Renewable Energy Grant Fund (REF) Update F. Denali Commission Update G. Power Project Loan (PPF) Update H. Community Outreach I. Articles of Interest J. Next Regularly Scheduled AEA Board Meeting Wednesday, December 6, 2023 9. EXECUTIVE SESSION – To discuss confidential financial matters, and owned assets the immediate knowledge of which would have an adverse effect on Alaska Energy Authority. 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 the day before the meeting, so they can be shared with board members prior to the meeting. On the meeting day, callers 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. Alaska Energy Authority Page 2 of 2 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. 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 Alaska Energy Authority BOARD MEETING MINUTES Thursday, September 21, 2023 Anchorage, Alaska 1. CALL TO ORDER Chair Pruhs called the meeting of the Alaska Energy Authority to order on September 21, 2023, at 8:30 am. A quorum was established. 2. ROLL CALL BOARD MEMBERS Members present: Chair Dana Pruhs (Public Member); Vice-Chair Bill Kendig (Public Member); Albert Fogle (Public Member); Julie Sande (Commissioner DCCED); Adam Crum (Commissioner DOR); Bill Vivlamore (Public Member); and Randy Eledge (Public Member). Commissioner Sande indicated that she has multiple obligations today and will leave the meeting for a period of time and then return to the meeting. Commissioner Sande advised that Deputy Commissioner Micaela Fowler is attending and will vote on her behalf. 3. AGENDA APPROVAL MOTION: A motion was made by Vice-Chair Kendig to approve the agenda. Motion seconded by Mr. Fogle. The motion to approve the agenda passed without objection. 4. PRIOR MINUTES – August 2, 2023 MOTION: A motion was made by Vice-Chair Kendig to approve the prior minutes of August 2, 2023. Motion seconded by Mr. Fogle. Mr. Eledge asked if the year 2033 was correct as indicated on page 10, within the third paragraph of Item K. Curtis Thayer, Executive Director and Secretary-Treasurer, stated the year was correct. There were no other comments or questions. The motion to approve the minutes of August 2, 2023 passed without objection. 5. PUBLIC COMMENTS (2 minutes per person) There were no members of the public online or in-person who requested to comment. 6. NEW BUSINESS – None Alaska Energy Authority Page 2 of 4 7. OLD BUSINESS - None 8. DIRECTOR COMMENTS A. Responses to Board Questions from September Board Meeting Mr. Thayer noted that the information clarifies and addresses the questions regarding the NEVI plan. B. Governor’s State Energy Security Task Force Update (August Meetings) Mr. Thayer provided the update on the Governor’s Alaska Energy Security Task Force (AESTF). He reviewed the six subcommittees and noted they have been meeting individually, as well as collectively. He reviewed the current timeline for the recommendations, the public comment period, AESTF voting, and final submittal to the Governor and the Legislature on December 1, 2023. All of the information presented is on the website. Mr. Thayer discussed the significant amount of time spent by the AESTF and the subcommittees. He emphasized that AEA staff have contributed additional time to the planning and organizing effort. Staff and the contractor have attended all of the subcommittee meetings and are providing support. C. Railbelt Owned Assets Update Mr. Thayer reviewed the quarterly update of the Railbelt Owned Assets; Alaska Intertie, Bradley Lake Hydroelectric Project, and rural transmission. Mr. Thayer discussed the recent trips with 11 legislators and others to Bradley Lake. He provided information regarding AEA’s ownership of old rural transmission tielines and the process to transfer and dispose of the lines within the next six months. D. Dixon Diversion Project Mr. Thayer discussed the status of the Dixon Diversion Project and memorandum included in the packet. He reviewed the project timeline. E. Hydro Update Mr. Thayer gave an overview of the Hydroelectric Program Update included in the packet. He reviewed the status and funding of each of the projects. F. IIJA / IRA Grant Funding Update Mr. Thayer informed that he has been providing weekly reports to members. He indicated that the 80-page Solar For All application due date has been extended to October 12. G. Community Outreach Mr. Thayer noted that the community outreach information lists the dates and topics of previous Alaska Energy Authority Page 3 of 4 events, as well as this year’s remaining 19 scheduled events. H. Articles of Interest Mr. Thayer stated that the Articles of Interest are in the packet on pages 35 through 96. Mr. Fogle referenced a previous article of interest concerning the liquefied natural gas (LNG) imported to Alaska to compensate for the energy production deficit. He asked if Mr. Thayer is helping to facilitate conversations regarding the LNG import or how to look for more gas in the Inlet. Mr. Thayer indicated that he is not facilitating conversations. He explained those conversations are between Enstar, the utilities, and the Governor. Mr. Thayer noted that he has been invited to a public luncheon with Enstar and legislators outlining Enstar’s drivers and options. Mr. Fogle inquired if there is a way AEA can assist with the discussions or ideations. Mr. Thayer explained that there are established private entity nondisclosure agreements (NDAs) and that AEA has not been invited to assist. Mr. Fogle asked if AEA could potentially discuss with Enstar that a long-term solution might be Susitna-Watana. Mr. Thayer commented that Enstar and all of the utilities are supportive of the Susitna-Watana project. The less natural gas the electrical utilities use to generate electricity means more natural gas in the long-term to provide for home heating. Vice-Chair Kendig requested clarification for the amount of generation that is expected from the 100 MW solar and wind facility capability. Mr. Thayer noted the expected generation is approximately 30%. The Battery Energy Storage Systems (BESS) are also being installed to help with short-term regulations. However, there is no current technology for long-term storage. The current technology is unable to store renewable energy in July and use it in October. Mr. Thayer discussed that the Regulatory Commission of Alaska (RCA) has been conducting a series of public meetings on renewables and the cost of renewables. He will compile the information for Board members. Chair Pruhs requested staff to conduct a study that clearly delineates the true benefits and the direct relationships to the consumer of including the current forms of renewables and that clearly delineates the effects to the baseline requirements that the utilities have to pay. Mr. Thayer advised that the University, the utilities, AEA, and National Renewable Energy Laboratory (NREL) have participated in a study which is scheduled to be released in December. Mr. Thayer noted that he will attempt to acquire an early draft of those findings. Vice-Chair Kendig noted the importance of increasing the longevity of the battery systems to days or months, rather than the current assistance based in hours. Mr. Eledge requested that the study include the component of the correlation between the renewables and the capital cost of batteries. I. Next Regularly Scheduled AEA Board Meeting Wednesday, October 25, 2023 Alaska Energy Authority Page 4 of 4 MOTION: A motion was made by Vice-Chair Kendig to go into executive session to discuss confidential matters related to Fiscal Year 2025 budget and Owned Assets Strategic Review; that the immediate disclosure of which would have an adverse impact on the Authority. This is supported by the Open Meetings Act, AS 44.62.310, which allows a board to consider confidential matters in executive session. In this case, the board believes that these are subjects which would have an adverse effect upon the finances of AEA and are protected by law, due to rules protecting personal privacy and certain business information. Motion seconded by Mr. Fogle. Vice-Chair Kendig advised that he has a conflict for the Owned Assets Strategic Review section of Executive Session, and he will not attend that portion. Chair Pruhs acknowledged the potential conflict. A roll call was taken, and the motion to go into executive session passed unanimously. 9. EXECUTIVE SESSION: 9:10 a.m. – To discuss confidential financial matters, the immediate knowledge of which would have an adverse effect on Alaska Energy Authority: • FY25 budget update • Owned Assets Strategic Review The Board reconvened its regular meeting at 10:57 am. Chair Pruhs advised that the Board did not take any formal action on matters discussed while in Executive Session. 10. BOARD COMMENTS Mr. Fogle thanked Mr. Thayer and staff for compiling the information in an effective format. Chair Pruhs expressed appreciation to staff for their time and effort directed at the many different issues and at the extensive energy project opportunities. 11. ADJOURNMENT There being no further business of the Board, the AEA meeting adjourned at 11:00 am. ____________________________________________ Curtis W. Thayer, Secretary 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 MEMORANDUM TO: Alaska Energy Authority Board THRU: Tim Sandstrom, Chief Operating Officer, AEA FROM: PPF Loan Committee DATE: October 12, 2023 RE: AEA Resolution No. 2023-02 / Ounalashka Chena Power LLC PPF Loan Application Resolution No. 2023-02 would approve the Power Project Fund (“PPF”) loan application from Ounalashka Chena Power LLC (“Borrower” or “OCCP, LLC”) for the proposed 30MW Makushin Geothermal Project (“Project”) located in Unalaska, AK on the eastern flank of the Makushin volcano, on those lands owned by the Ounalashka Coroporation, the Alaska Native Village corporation for Unalaska, and leased to the the Borrower for a term of 50 years for the development and long-term operation of the Project. GPS coordinates for the site are approximately 53°52'53.12"N, 166°50'28.36"W. Project Ownership The Makushin Geothermal Project (“Project”) will be owned by OCCP, LLC, an Alaska limited liability company organized under Alaska certificate of organization number 10114868. As required per PPF eligibility statutes (ref. AS 42.45.010(b)(1)), OCCP LLC is a Regulatory Commission of Alaska (“RCA”) certificated electrical utility under certificate of public convenience and necessity (“CPCN”) 781, as established under RCA order U-20-083, issued on June 23, 2021. OCCP, LLC is a partnership jointly owned by the Ounalashka Corporation (“OC”), the Alaska Native Village corporation for Unalaska, and Chena Power, LLC (“CP”) a privately-held entity, and certificated electric utility, based in Fairbanks, Alaska which installed and operates the first geothermal power plant in the state at Chena Hot Springs, Alaska under CPCN 704. OCCP, LLC’s joint ownership is structured as a majority 51% ownership by OC, and 49% by CP. Background and Purpose In 2019, OCCP, LLC was established with the primary aim to develop a long-term zero-carbon- emission, renewable power generation resource for the community of Unalaska and its industrial users. A critical part of the development of the Project was the securing of the land for the Project site. OC is the landowner for the Project site and in evidence of its support for the Project and in contribution for the success of the Project, OC has entered into a 50-year lease with OCCP, LLC for its development and long-term operation. On August 31, 2020, OCCP, LLC and the City of Unalaska (COU) signed a Power Purchase Agreement (PPA), effectuating OCCP, LLC’s and COU’s mutual commitment to the development of the MGP, and securing an anchor off-taker tenant for power purchases from the Project. Alaska Energy Authority Three amendments have since been agreed to between OCCP, LLC and COU regarding extending those preliminary deadlines related to project commissions and the securing of long- term financing, which provides further evidence as to mutual commitment to the full development of the Project, by both the energy seller, and principal off-taker/buyer. OCCP, LLC, funded via equity contributions from both its members, OC and CP, has conducted the Front-End Engineering and Design Phase process, and all related ancillary costs either directly or in-kind. OCCP has completed the engineering, permitting, planning, and procurement requirements for the Project contracting with a variety of experienced and qualified contractors for such phases. The Project has now moved into its construction phase with OCCP, LLC, through continued expenditure of OC & CP equity funds, continuing to develop the utility access corridor (UAC), to keep the Project on schedule, including an executed Engineering, Procurement, and Construction (“EPC”) agreement, concerning the generating plant itself, with Ormat Technologies, Inc (Ormat) an experienced and recognized entity in the manufacture and deployment of geothermal power plants. This PPF loan is requested to provide additional financial assistance to OCCP, LLC in bridging time required to secure long-term financing while still keeping overall project on schedule. The principal source of funding is a $193 million fixed term loan under the U.S. Department of Energy (“DOE”) Tribal Energy Loan Program (“TELP”), with DOE’s Loan Programs Office (“LPO”). Project documents as provided by OCCP, LLC indicate a commissioning date of the plant, subject to change, for Q4 2027, and subsequent commercial operation date (“COD”) for Q1 2028. The Loan Request Development costs for 2023, as stated by OCCP, LLC in their application are $11.3 million in support of 10 categories of Project activities: permits, consultants and staff, mobilization, construction camp operations, UAC completion, pad construction, Power Engineers design effort, wellfield development, Unalaska support services, financing and bank fees and other field office costs. At $4.9 million, PPF loan proceeds will fund approximately 50% of the activities planned for 2023, and early 2024, as subject to change on timing of available financing. The activities to be supported via the use of PPF loan proceeds are the first tasks needed to start the Project’s construction phase with the majority of funds, over 80%, focused on completing the UAC and starting the wellfield drilling task. These tasks are inextricably linked whereby wellfield drilling cannot start until UAC is completed. The PPF loan will accelerate 2023 scope of activities allowing wellfield activities to finish, with the understanding that some of the wellfield activities may be delayed owing to volatile weather. Application History The Alaska Energy Authority (“AEA”) received the Borrower’s revised PPF loan application on August 14, 2023, with the initial application received in May 2023, and revised owing to restrictions on PPF funds with respect to funding construction of power generation assets rated in excess of 10 MW. On October 11, 2022, the PPF Loan Committee unanimously approved the Alaska Energy Authority loan application subject to those terms as stated in the term sheet, as provided in the attached Exhibit B – Loan Terms. Per PPF regulation 3 AAC 106.110, AEA now forwards the application to the Board for its approval the $4,944,000 million loan to continue development of the Project as described in this memo and per those Project details provided in stated in the attached Exhibit D – PPF Loan Committee Summary Packet. Project Information The Project is a 30 MW utility-scale geothermal power project located on the eastern flank of the Makushin Volcano on the island of Unalaska, AK at the approximate GPS coordinates of 53°52'53.12"N, 166°50'28.36"W. OCCP, LLC, a RCA-certificated electrical utility (“IPP”), has an executed a 30-year Power Purchase Agreement (“PPA”) with the City of Unalaska (“COU”). OCCP, LLC also has in-place a fully-executed EPC agreement with Ormat. In March 2023, AEA and the Alaska Industrial Development and Export Authority (“AIDEA”) conducted a joint visit to Unalaska and met with Project stakeholders, including the COU, OC, CP, seafood processors, and community groups, conducted an aerial survey of the plant site, and inspected the man camp at the terminus of the terrestial Utility Access Corridor (“UAC”). The site is well-suited for a geothermal project, as evidenced by the volumes of geotechnical reserach papers conducted on the Maksuhin resource including those conducted by AEA/AIDEA, and as evidenced in the geothermal fluid guarantee, included as part of the Ormat EPC contract. An overview of the site and site photos are provided in Exhibit C - Site Plan & Site Photos. Financial Feasibility As required per 3 AAC 106.125(a) AEA examined the Borrower’s ability to repay the loan. The OCCP, LLC provided financial model dated August 30, 2023, which was created in conjunction with OCCP, LLC-contracted third-party consultants indicates a Project IRR of 8.37%, average debt-service coverage ratio of 1.2, and a debt to equity ratio of 0.41. As noted in an AIDEA- provided independent third-party review, while the post-tax Project IRR is reflected as lower than those typically seen for comparable medium to low risk energy infrastructure projects, it is understood that the financiers sought for the financing of the Project, being state and federal government entities, are aware that this is principally the reason as to why OCCP, LLC has sought such public-financing partners, as public financing is generally not subject to the same high expectations for return on investment as would be other conventional lenders. In AEA’s recent conversations and correspondence with DOE LPO the week of October 2, 2023, DOE stated that it has now entered its formal due diligence with OCCP, LLC, with the Project having successfully passed those requirements of DOE LPO’s preliminary review stages which considered the Project’s legal eligibility under DOE LPO’s TELP, as well as preliminary commercial, technical, and financial viability of the Project. It is AEA’s determination that this is an financially viable Project and provides sufficient cash flow to cover operating expenses and debt repayment, the Project’s financial feasibility and prospect of repayment is further augmented with the provision of an adequately funded debt-service account in the financial model to account for such debt servicing. Economic Viability Alaska Energy Authority The purpose of the project is to provide, long-term, cost competitive, renewable geothermal power to the COU and its industrial base under the established PPA and any future amendments or addendums thereto. The Project will provide long-term renewable electrical power generation and mitigate those harmful anthropogenic emissions from diesel-only power generation, improving the quality and potential longevity of life for those residents of Unalaska. The Borrower-provided project costs state a total development cost of $235.2 million, or $203 million, excluding a 16% contingency. Per research published by the National Renewable Energy Laboratory (“NREL”) from 2022, the estimated capex per kW of installed capacity for geothermal power facilities was $6,652, which when applied to the Project (30,000 kW), yields a total Project cost of $199,560,000, which is effectively comparable to the estimated cost as provided by OCCP, LLC, with an observed delta of 1.8%, supporting the reasonableness of the project cost estimates. At the proposed, base-case rate of $0.163 per kWh, the wholesale power sales rate to COU is 50% less than what COU can self-generate, assuming an average diesel fuel price of FY2022 reported $3.08, if the diesel fuel price were to increase, the discount for MGP power also increase. The inclusion of additional off-takers such as Trident and Unisea, which have provided letters of intent to purchase, would reduce the Project’s nominal cost of power to COU. Effectively, the Project can generate and sell power to COU at a rate cheaper than COU can self-generate, even if COU only consumed only 50% of the COU’s proposed baseline power consumption of 100 MkWh. It is AEA’s determination that this is an economically viable Project and provides for subtantial cost savings and long-term benefits to the community. Technical Feasibility: To provide an unbiased third-party technical review of the Project, AIDEA contracted with GeothermEx, a subsidiary of SLB (formerly known as Schlumberger) to conduct a thorough review of the technical specifications of the Project as provided by OCCP, LLC. GeothermEx, in its overall findings, has stated that “The characteristics of the geothermal resource appear to be compatible with the planned project, especially as regards the heat resource that is potentially available for exploitation. Because there is so far only one exploratory well (i.e. ST-1) that has directly investigated the geothermal reservoir (providing information on potential well capacities), some uncertainty remains as to what will be the typical characteristics of wells drilled over a broader area (which will be necessary to supply and sustain the project).” In AEA’s review of those contractors selected by OCCP, LLC to assist, perform, and/or consult in the design, development, supply and/or construction of the project, AEA found no deficiencies in the ability of the selected vendors to perform those activities / tasks as stated. AEA has determined this Project, as proposed, to be technically feasible. Findings: As required by 3 AAC 106.110, the Alaska Energy Authority hereby makes the following determinations: 1. Both the Project and the Borrower are eligible under the PPF loan program. 2. The project meets the needs of the area and the area will benefit from the project. 3. All necessary permits or certificates have been applied for or awarded. Alaska Energy Authority 4. The Borrower has sufficient debt service reseves, guaranteed revenue from power sales to COU via the PPA, and to repay the loan. 5. Sufficient funds are available in the Power Project Fund to make the loan. 6. The project is economically viable, technically feasible, and financially feasible. 7. No alternatives currently exist, to AEA’s knowledge, to the project at a different site, by a different method, or by another applicant that could be expected to provide comparable volumes of power at lower cost which meets the needs of the area, that could be built within comparable timeframe, that is economically viable and financially feasible. 8. The project benefits the area by providing power from a renewable source at a stable rate acceptable to COU and its customers, as evidenced by the PPA. Conclusion, Recommendation, and Conditions: The PPF Loan Committee and AEA staff recommend the AEA Board of Directors approve and adopt Resolution No. 2023-02 effectuating the approval of the loan terms as recommended and approved by those presiding members of the PPF Loan Committee on its meeting held on October 11, 2023, as evidenced in Exhibit A – PPF Loan Commitee Recommendation. The approved and recommended loan terms and conditions are included in the attached Exhibit B – Loan Term Sheet. Attachments: Exhibit A – PPF Loan Committee Recommendation Exhibit B – Loan Term Sheet Exhibit C – Site Plan & Site Photos Exhibit D – PPF Loan Committe Summary Packet 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 Exhibit A: PPF Loan Committee Recommendation 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 On October 11, 2023, the PPF Loan Committee convened to consider the loan application from Ounalashka Chena Power, LLC, concerning the Makushin Geothermal Project (Loan #40901155). The committee voted unanimously to approve the loan subject to the following terms: Loan amount (excl. closing fee): $4,900,000 (42%) Closing Fee: $44,000 ($49,000 net of $5,000 application fee) due at closing. Applicant has requested to add this to the principal loan balance, as allowed per 3 AAC 160.150(d) Term: o Fixed Line of Credit (FLOC) for 12 months from the execution date of the loan documents or the date the project is complete, whichever is sooner, with quarterly, interest-only payments. o Term loan on outstanding balance of FLOC amortized quarterly for 30 years. Equity: $6,750,472 (58%) Interest rate: o Fixed rate of 5.03%, the prevailing PPF rate as of week of May 1, 2023. Estimated term payment on fully advance loan, inclusive of $44,000.00 closing fee, of $4,944,000: o $80,037 quarterly / $320,148 annually Loan Draw/Disbursement Conditions: o Borrower shall use equity funds prior to request of PPF loan proceeds and shall provide documentation to support funds expended, including verified invoices and progress documentation to the satisfaction of the Authority. Source of repayment: o Debt service reserve account, revenues from the sale of electricity under Power Purchase Agreement, Investment Tax Credit Receipts, payment via draw(s) on DOE TELP Line of Credit Collateral: o The term loan shall be secured by a Uniform Commercial Code (UCC) filing of all revenues from all of Borrower's sales of electricity, including all receipts, revenue, income, rents, royalties, benefits, rates, fees, charges and other monies received or derived from the services, facilities and commodities sold, furnished or supplied through the facilities of the electric utility; property, assets, and equipment financed by the loan; in the event of default. AEA shall maintain the highest position possible with respect to the equipment and revenues financed by the Project, for avoidance of being materially detrimental to the securing of long-term financing by the Borrower; and DocuSign Envelope ID: D0C16247-4798-48F7-9778-05EBC6421CBB 813 West Northern Lights Boulevard, Anchorage, Alaska 99503 | P 907.771.3000 | Toll Free 888.300.8534 | F 907.771.3044 | WWW.AKENERGYAUTHORITY.ORG o Signed guarantee(s) by OCCP, LLC, its related entities, or as offered through other guarantors, such as Alaska Industrial Development and Export Authority (AIDEA) in a form acceptable and to the satisfaction of AEA and the State of Alaska Department of Law, so as to secure the loan and guarantee repayment to the State in the event of default by the Borrower. Conditions Precedent: The conditions precedent to closing, will include, but not be limited to: o Signed guarantee(s) by OCCP, LLC, its related entities, or as offered through other guarantors, such as Alaska Industrial Development and Export Authority (AIDEA) in a form acceptable and to the satisfaction of AEA and the State of Alaska Department of Law, so as to secure the loan and guarantee repayment to the State in the event of default by the Borrower. o The loan agreement shall require AEA approval for the sale of the Project or the transfer of all or a portion of its ownership, except should the loan be fully repaid at the time of sale. o All required permits, for phases to be funded with use of PPF loan proceeds, shall be obtained or applied for prior to closing. o As part of the loan agreement, the Borrower shall maintain commercial general liability, automobile, or personal property insurance on the equipment with AEA listed as the mortgage loss payee. In addition, AEA is to be listed as an additional insured on the Borrower’s public liability insurance. SIGNATURE(S) SECTION: Tim Sandstrom, Chief Operating Officer, AEA Date Audrey Alstrom, Dir. Alternative Energy and Energy Efficiency, AEA Date Clay Christian, Chief Financial Officer, AIDEA/AEA Date DocuSign Envelope ID: D0C16247-4798-48F7-9778-05EBC6421CBB 10/11/2023 | 4:37:48 PM AKDT 10/11/2023 | 4:37:41 PM AKDT 10/11/2023 | 10:18:32 PM AKDT 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 Exhibit B: Loan Term Sheet 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 Loan Term Sheet: Loan amount (excl. closing fee): $4,900,000 (42%) Closing Fee: $44,000 ($49,000 net of $5,000 application fee) due at closing. Applicant has requested to add this to the principal loan balance, as allowed per 3 AAC 160.150(d) Term: o Fixed Line of Credit (FLOC) for 12 months from the execution date of the loan documents or the date the project is complete, whichever is sooner, with quarterly, interest-only payments. o Term loan on outstanding balance of FLOC amortized quarterly for 30 years. Equity: $6,750,472 (58%) Interest rate: o Fixed rate of 5.03%, the prevailing PPF rate as of week of May 1, 2023. Estimated term payment on fully advance loan, inclusive of $44,000.00 closing fee, of $4,944,000: o $80,037 quarterly / $320,148 annually Loan Draw/Disbursement Conditions: o Borrower shall use equity funds prior to request of PPF loan proceeds and shall provide documentation to support funds expended, including verified invoices and progress documentation to the satisfaction of the Authority. Source of repayment: o Debt service reserve account, revenues from the sale of electricity under Power Purchase Agreement, Investment Tax Credit Receipts, payment via draw(s) on DOE TELP Line of Credit Collateral: o The term loan shall be secured by a Uniform Commercial Code (UCC) filing of all revenues from all of Borrower's sales of electricity, including all receipts, revenue, income, rents, royalties, benefits, rates, fees, charges and other monies received or derived from the services, facilities and commodities sold, furnished or supplied through the facilities of the electric utility; property, assets, and equipment financed by the loan; in the event of default. AEA shall maintain the highest position possible with respect to the equipment and revenues financed by the Project, for avoidance of being materially detrimental to the securing of long-term financing by the Borrower; and o Signed guarantee(s) by OCCP, LLC, its related entities, or as offered through other guarantors, such as Alaska Industrial Development and Export Authority (AIDEA) 813 West Northern Lights Boulevard, Anchorage, Alaska 99503 | P 907.771.3000 | Toll Free 888.300.8534 | F 907.771.3044 | WWW.AKENERGYAUTHORITY.ORG in a form acceptable and to the satisfaction of AEA and the State of Alaska Department of Law, so as to secure the loan and guarantee repayment to the State in the event of default by the Borrower. Conditions Precedent: The conditions precedent to closing, will include, but not be limited to: o Signed guarantee(s) by OCCP, LLC, its related entities, or as offered through other guarantors, such as Alaska Industrial Development and Export Authority (AIDEA) in a form acceptable and to the satisfaction of AEA and the State of Alaska Department of Law, so as to secure the loan and guarantee repayment to the State in the event of default by the Borrower. o The loan agreement shall require AEA approval for the sale of the Project or the transfer of all or a portion of its ownership, except should the loan be fully repaid at the time of sale. o All required permits, for phases to be funded with use of PPF loan proceeds, shall be obtained or applied for prior to closing. o As part of the loan agreement, the Borrower shall maintain commercial general liability, automobile, or personal property insurance on the equipment with AEA listed as the mortgage loss payee. In addition, AEA is to be listed as an additional insured on the Borrower’s public liability insurance. 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 Exhibit C: Project Site Plan & Site Photos 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 Project Site Plan and Site Photos: Project Site Plan Project Vicinity Alaska Energy Authority Project Site Photos Man Camp looking west up Makushin Valley Man Camp at Broad Bay View west of UAC access road under development Terrestrial terminus of UAC at Broad Bay View east towards Broad Bay from UAC View looking west up Makushin Valley 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 Exhibit D: PPF Loan Committee Summary Packet Ounalashka Chena Power (OCCP), LLC PPF Loan Committee Packet Prepared by: Conner Erickson - cerickson@akenergyauthority.org Presentation to the AEA Loan Committee: October 11, 2023 Summary Ounalashka Chena Power, LLC (OCCP, LLC or Borrower), a partnership between Chena Power, LLC (CP) and the Ounalashka Corporation (OC), and as conditionally-certificated under the Regulatory Commission of Alaska (RCA) certificate of public convenience and necessity (CPCN) number 781, has applied for a Power Project Fund (PPF, est. AS 42.45.010) loan in the amount of $4,900,000 to provide “bridge” funding, while other long-term financing sources are secured, for continued development of specific elements of their Makushin Geothermal Project (MGP or Project) which seeks to develop, construct, and operate a 30MW geothermal electrical generation facility on the eastern flank of Makushin volcano to provide wholesale zero-carbon-emission, renewably sourced power to the City of Unalaska (COU) and its industrial entities. OCCP, LLC has stated that upon approval of the loan by AEA’s Board of Directors, OCCP, LLC would like to add the one-percent closing fee of $44,000 ($49,000 net of its $5,000 application fee), to the initial principal balance of the loan, yielding a total loan request of $4,944,000, as allowed per 3 AAC 106.150(d). The Borrower, in their provided project schedule dated August 30, 2023, indicates receipt of PPF funds in Q3 2023, the earliest of proceeds received other stated project investors. Per the same Borrower-provided schedule, the commissioning date of the plant, subject to change, is scheduled for Q4 2027, and subsequent commercial operation date (COD) in Q1 2028. The total Project costs are estimated to be $235,253,533, exclusive of equity buyback and capitalized interest, the inclusion of which is estimated to yield a total Project cost of $294,184,954, as noted in Table 1 below. The balance of the project cost, net of the PPF loan requested, will be funded through a combination of Borrower/Owner equity, loan funds from the Alaska Industrial Development and Export Authority ($25 million), Investment Tax Credits ($57 million) and a line of credit / fixed-term loan from the (DOE) Tribal Energy Loan Program (TELP) of the DOE Loan Programs Office (LPO) ($193 million), which is under review and due diligence by DOE. OCCP, LLC’s financing plan is provided in Table 1 below. PPF loan request: $4,900,000 (excl. closing fee of $44,000) PPF Loan No.: 40901155 Applicant: Ounalashka Chena Power, LLC Purpose: Development of the Makushin Geothermal Project – 30MW plant. Applicant request: 30 years, 5.03% interest rate, the prevailing PPF rate at the time of the initial application submittal (5/1/23). Table 1: OCCP,LLC - Sources and Uses of Funds The DOE loan review is currently in its due diligence phase, with anticipated decision on loan approval for Q1 2024. Per AEA correspondence with DOE LPO in early October, DOE’s initial review was focused on a determination concerning the “reasonable prospect of repayment” for DOE’s TELP loan. In early September 2023, satisfied with OCCP, LLC’s plan, DOE’s LPO did issue a formal invitation to OCCP, LLC to enter DOE’s full due diligence phase, which OCCP, LLC accepted. OCCP, LLC has completed its Front-End Engineering and Design (FEED) phases of the Project and has executed an engineering, procurement, and construction (EPC) with Ormat Technologies, Inc (Ormat) an experienced and recognized entity in the manufacture and deployment of geothermal power plants, which includes a geothermal fluid guarantee from OCCP, LLC, which informed the design of the plant. The Project will be interconnected with the COU by way of 14 miles of buried transmission lines, including a sub-sea portion across Broad Bay for interconnection/integration with COU’s electrical infrastructure, as illustrated in Figure 1 below. Figure 1: MGP Site Overview Plant Engineering, Procurement, and Construction 102,351,120$ Power Delivery and Integration 34,149,259$ Other Construction 49,579,817$ Other Associated Costs 17,000,000$ Total Planned Construction Costs 203,080,196$ Project Contingency 32,173,337$ Total Estimated Costs (including contingency)235,253,533$ Equity Buyback 38,991,468$ Capitalized Interest 19,939,953$ Total Cost including Financing 294,184,954$ Owner Equity 16,417,122$ AEA Loan 4,900,000$ AIDEA Loan / Equity 25,000,000$ Investment Tax Credits 57,003,121$ DOE Loan 192,413,920$ Total Funds 295,734,163$ Uses of Funds Sources of Funds Additional elements of the Project include a City-wide building heating oil replacement project to replace oil- based boilers with air source heat pumps, providing increased electrical load for COU, and distributing the flat- rate PPA over a larger number of kilowatt-hours, as stated in Section 8 of the PPA. Furthermore, several of the largest industrial entities with significant operations and power requirements in the COU have provided letters of intent to purchase MGP-provided power from the COU, as they desire to convert their current diesel-fueled operations to renewably-sourced power, these entities include Trident Seafoods and UniSea. To interconnect these industrial entities with the COU grid, the PPA stipulates, as per Section 11, cost-sharing with respect to OCCP, LLC and COU regarding the necessary equipment and reliability upgrades required for the interconnection of such industrial entities. The PPF loan is anticipated to be serviced primarily via a debt service reserve account, with potential early payoff via the application of the tax credits, or a pay-down via the use of DOE TELP funds. On August 31, 2020, OCCP, LLC and the COU signed a Power Purchase Agreement (PPA), effectuating OCCP, LLC’ and COU’s mutual commitment to the development of the Makushin Geothermal Project. The term of the PPA is 30 years, equal to the term requested for the loan; additionally, analyses conducted by the Argonne National Laboratory substantiate the 30-year, or more, useful life of geothermal electrical generation facilities, satisfying the PPF regulatory term requirements of 3 AAC 106.12(a)(2). The loan application for this proposed project is eligible under prevailing PPF program statutes (AS 42.45.010) and regulations (3 AAC 106.100-159). Staff Recommendations to Loan Committee The Borrower has requested the prevailing PPF interest rate at the time the application was submitted to AEA, with a 30 year term, with quarterly payments. Staff recommends the terms below: Loan amount: $4,900,000 (42%) Closing Fee: $44,000, net of $5,000 application fee, due at closing. applicant has requested to add this to the principal loan balance, as allowed per 3 AAC 160.150(d) Equity: $6,750,472 (58%) Term: 30 years, with quarterly payments o Fixed Line of Credit (FLOC) for 12 months from the execution date of the loan documents or the date the project is complete, whichever is sooner, with quarterly, interest-only payments. o Term loan on outstanding balance of FLOC amortized quarterly for 30 years. Interest rate: 5.03% Estimated quarterly payment: $80,037 Loan Draw/Disbursement Conditions: o Borrower shall use equity funds prior to request of PPF loan proceeds and shall provide documentation to support funds expended, including verified invoices and progress documentation to the satisfaction of the Authority. Source of repayment: Debt service reserve account, revenues from the sale of electricity under Power Purchase Agreement, Investment Tax Credit Receipts, payment via draw(s) on DOE TELP Line of Credit Conditions precedent to closing o Signed guarantee(s) by OCCP, LLC, its related entities, or as offered through other guarantors, such as Alaska Industrial Development and Export Authority (AIDEA) in a form acceptable and to the satisfaction of AEA and the State of Alaska Department of Law, so as to secure the loan and guarantee repayment to the State in the event of default by the Borrower. o The loan agreement shall require AEA approval for the sale of the Project or the transfer of all or a portion of its ownership, except should the loan be fully repaid at the time of sale. o All required permits, for phases to be funded with use of PPF loan proceeds, shall be obtained or applied for prior to closing. o As part of the loan agreement, the Borrower shall maintain commercial general liability, automobile, or personal property insurance on the equipment with AEA listed as the mortgage loss payee. In addition, AEA is to be listed as an additional insured on the borrower’s public liability insurance. Timing of Loan Re-Payment: Borrower’s initial principal and interest payment will be due on the first day of the full monthly period that follows disbursement of loan funds. Collateral Conditions: The term loan shall be secured by a Uniform Commercial Code (UCC) filing of all revenues from all of Borrower's sales of electricity, including all receipts, revenue, income, rents, royalties, benefits, rates, fees, charges and other monies received or derived from the services, facilities and commodities sold, furnished or supplied through the facilities of the electric utility; property, assets, and equipment financed by the loan; in the event of default. AEA shall maintain the highest position possible with respect to the equipment and revenues financed by the Project, for avoidance of being materially detrimental to the securing of long-term financing by the Borrower; and Signed guarantee(s) by OCCP, LLC, its related entities, or as offered through other guarantors, such as Alaska Industrial Development and Export Authority (AIDEA) in a form acceptable and to the satisfaction of AEA and the State of Alaska Department of Law, so as to secure the loan and guarantee repayment to the State in the event of default by the Borrower. Rationale: Staff recommends approving OCCP, LLC for a $4,944,000 loan at 5.03% fixed interest rate for a 30 year term, with quarterly payments, based on the following rationale: 1. The project and applicant are eligible for PPF financing pursuant to AS 42.45.010(b)(1) and AS 42.45.010(b)(1)(B), as operating under RCA-issued conditional CPCN 781, as recorded under RCA order U-20-083. 2. Although OCCP, LLC is a recently established utility, OCCP, LLC has executed an EPC with Ormat for the construction of the power plant, the design of which is informed via an executed geothermal fluid guarantee. Ormat is an experienced and recognized entity in the manufacture and deployment of geothermal power plants with over 3,200 MWs of geothermal energy across 190 power plants worldwide. 3. The OCCP, LLC team is comprised of individuals with substantial background in energy development, including an expert in geothermal energy. Additionally, CP is experienced in the development of geothermal projects, with its development and installation of two 200 kilowatt and one 280 kilowatt organic rankine cycle (ORC) geothermal power units at Chena Hot Springs, Alaska. 4. OCCP, LLC has an executed PPA in place with COU, the main off-taker for the Project, guaranteeing a fixed payment of $16.3 million per year to OCCP, LLC. The PPA also includes cost-share requirements for necessary interconnection and reliability upgrades to COU’s existing electrical grid, allowing for interconnection by those industrial users with large power requirements, as well as cost-sharing for COU residents conversion to electrified air-source heat-pumps, all increasing electrical load to reduce cost per kWh over the Project lifetime. 5. Trident Seafoods (Trident) has begun site preparation and development of a new seafood processing facility, as part of its ongoing transition out of Akutan, on Captain’s Bay in near proximity to COU. Trident remains committed to the development of the facility, and anticipates commissioning the facility sometime in 2028, in alignment with the proposed operational date of the Project. Trident has provided letters of support for the project, and its desire for renewable, cost-competitive, geothermal power. It is anticipated that the additional electrical load demand from the Trident site would be approximately 10MW, a load which was not anticipated when the initial off-taker estimates were made. 6. AEA and AIDEA, conducted a Project site visit in late March 2023 and were party to conversations with OCCP, LLC, COU, OC, and other community stakeholders which appeared to show significant support for the project, with no noted detractors. 7. The PPA’s pricing methodology will provide long-term predictable, stable rates over the term of the Agreement. The pricing was negotiated at a price of $16.3 million for up to 100 million kilowatt-hours (MkWh) or 16.3 cents per kilowatt-hour (kWh). A wholesale rate of 16.3 cents per kWh, is significantly less than the FY2022 reported 59 cents per kWh pre-Power Cost Equalization (PCE) rate, and marginally more that the FY2022 reported PCE rate of 35 cents per kWh, which can be subject to significant volatility owing to fluctuations in the price of diesel fuel. Additionally, with a cost-sharing clause in the PPA for power supplied in excess of the 100 MkWh, there is no financial benefit for the COU to reduce consumption or revert to diesel-fired generation, ensuring mutual benefit to COU and OCCP, LLC. With annual 1% inflationary adjustments applied, pricing under the Agreement is expected to provide COU and those interconnected industrial users with pricing below historical diesel-fuel rates, even when applying PCE-credits. The risk of rate increases for the Project’s power is de minimis. 8. The Project further diversifies Alaska’s energy supply with geothermal energy. While large industrial users will still seek to maintain redundant diesel backup generation capability to ensure business continuity, MGP-supplied affordable power will increase the cost-competitiveness of Unalaska seafood processors against global competition. 9. This is an important geothermal demonstration project for Alaska. Success of the Project would prove the cost structure, revenues, and scalability of such large-scale utility geothermal projects in other areas of the state, including those geothermal power possibilities being investigated at Mt. Spurr, Mt. Augustine, and others in Southcentral Alaska. There remains additional potential for new market opportunities in Unalaska owing to the cost-competitive power, including items related to food security or provision of power for the charging of electrified ocean-going vessels. 10. OCCP, LLC creditors provided good credit references and nothing material was found or determined to detrimental to development of the Project. 11. The Project benefits the local economy through the creation of construction and operations and maintenance (O&M) employment opportunities, and future employment opportunities which may be created indirectly owing to potential future industry location to COU owing to cost competitive made available by the Project. 12. In satisfaction of PPF regulation 3 AAC 106.110(D); no current or future alternatives exist, to AEA’s knowledge which would result in development of power at a different site, by a different method, or by an entity other than the applicant which could be expected to provide, within a time schedule comparable to the project, comparable volumes of power at a lower cost to the consumer. OCCP, LLC has provided a myriad of information concerning the Project to AEA, which is comprehensive and supported via cited sources. OCCP, LLC has also expended considerable time and expense in developing this project since its establishment in 2019, and is has been successful in ongoing negotiations with DOE concerning a long-term fixed rate loan which would provide for the balance of funds to the Project. No other energy resources at this time, within the Project vicinity, are known to exist of the necessary comparable size, scope, or application of proven technology. 13. The Borrower has no outstanding debt. Background The Borrower is OCCP LLC, an Alaska limited liability company and certificated electrical utility, established in October 2019 under entity identifier 10114868, and operating under Alaska business license number 2147109. OCCP, LLC ownership is organized as majority 51% ownership by Ounalashka Corporation, the Alaska Native Village corporation for Unalaska, with the remaining ownership of 49% held by Chena Power, LLC, a privately-held entity, and certificated electric utility, based in Fairbanks, Alaska which installed and operates the first geothermal power plant in the state at Chena Hot Springs, Alaska under CPCN 704. OCCP, LLC as required per PPF eligibility statutes (see AS 42.45.010(b)(1)) is a RCA-certificated electrical utility under CPCN 781, as established under RCA order U-20-083, issued on June 23, 2021. In 2019, OCCP, LLC was established with the primary aim to develop a long-term zero-carbon-emission, renewable power generation resource for the community of Unalaska and its industrial users. A critical part of the development of the Project was the securing of the land for the Project site. OC is the landowner for the Project site and as part of its contribution to the Project, OC has entered into a 50-year lease with OCCP, LLC for its development. OCCP, LLC, funded via equity contributions from both its members, OC and CP, conducted the Front -End Engineering and Design Phase process, and all related ancillary costs either directly or in-kind. Since 2019, OCCP has completed the engineering, permitting, planning, and procurement requirements for the Project contracting with a variety of experienced and qualified contractors for such phases. On August 31, 2020, OCCP, LLC and the City of Unalaska (COU) signed a Power Purchase Agreement (PPA), effectuating OCCP, LLC’s and COU’s mutual commitment to the development of the MGP, and securing an anchor off-taker tenant for power purchases from the Project. Three amendments have since been agreed to between OCCP, LLC and COU regarding extending those preliminary deadlines related to project commissions and the securing of long-term financing, which provides further evidence as to mutual commitment to the full development of the Project, by both the energy seller, and principal off-taker/buyer. Furthermore, COU’s FY2024 budget provides for the funding of those PPA-required items to be borne by COU, being the interconnection/integration with the proposed Project, as per section 11(c) of the PPA, establishing continued commitment to the Project and honoring of the PPA terms. The Project has now moved into its construction phase with OCCP, LLC, through continued expenditure of OC & CP equity funds, continuing to develop the utility access corridor (UAC), to keep the Project on schedule, including an executed Engineering, Procurement, and Construction agreement, concerning the generating plant itself, with Ormat Technologies, Inc (Ormat) an experienced and recognized entity in the manufacture and deployment of geothermal power plants. This PPF loan will assist OCCP in bridging time required to secure long-term financing while still keeping overall project on schedule. Assuming no pre-payment penalty, once long-term financing is secured, OCCP may retire the PPF loan soon after COD, upon receipt of project investment tax credits, or request it continue as a subordinate loan to the DOE long term loan. Public Need Statement & Eligibility under AS 42.45.010 Applicant is establishing a power generation and transmission project (power facility) for direct sales into the City of Unalaska (City) power grid. Power facility plant is 14 miles from the City power grid and will be connected via a 35kV transmission line. Fuel source is geothermal fluids. Power facility is in a remote area with no existing infrastructure. Scope and size of new power facility development is beyond City means. Currently, City has a diesel, fuel-based utility serving over 1,207 customers, 929 of which are classified as residential, commercial, and industrial uses. There are other independent power producers (non-utility, but self-serving) on the Island that are not connected to the City electrical grid and/or are not current customers, but expected to be when this power facility reaches commercial operation in early 2028, and as stipulated in Section 11 of the PPA. The State of Alaska has a non-binding goal of generating 50% of its electricity from renewable energy sources by 2025. This project will aid the State of Alaska in meeting this non-binding target while providing renewable, sustainable, and predictable-cost competitive energy to COU and its private industrial partners. Additionally, the conversion from diesel-fueled power generation to renewable, geothermal power would help to mitigate negative environmental externalities experienced by residents of Unalaska, including reducing concentrations of airborne particulate matter owing to the burning of diesel fuel. Furthermore, the fixed-cost basis of power as stated in the PPA provides the COU with greater certainty as to costs related to the provision of power to COU-grid end-users, and with the increase in electrical load from the future interconnection of those currently self-generating industrial users, and electric, air source heat pumps, will provide opportunity for additional revenue to be generated by COU, adding to its healthy financial position, and the greater means to provide for the long-term sustained operation of the City and those services it provides to its residents. Project Location The project will be located within the following legal boundaries: All of the area located in Sections 30 and 31, Township 72 South, Range 118 West (Unsurveyed), Seward Meridian; Sections 25, 26, 27, 33, 34, 35, and 36, Township 72 South, Range 119 West, Seward Meridian; Sections 2 and 3, Township 73 South, Range 120 West, Seward Meridian; located within the Records of the Aleutian Island Recording District, Third Judicial District, State of Alaska. A location map is provided below in Figure 2 for reference. Figure 2: Project Location Engineering Design & Equipment Information The 30MW Project is a grid-interconnected, utility scale geothermal farm which will generate electricity from the east flank of the Makushin Geothermal Resource (MGR) and wholesale power to COU via a 14-mile utility access corridor, including a 3.2 mile subsea portion across Broad Bay, landing in the COU, see the “west substation” and “east substation” in Figure 2 for reference as to the subsea portion. The power will be wholesaled to the COU whereby the COU will then resell the power to end users. The Project is comprised of the following elements: power plant, wellfield / resource gathering system, utility access corridor (UAC) including transmission cabling and access roads, switch stations, COU electrical infrastructure upgrades, COU grid interconnection and system integration, and air source heat pump development. 1. Power Plant and ancillary equipment, including a 5.8 MW 2hr Tesla battery energy storage system (BESS) for assurance of grid stability (i.e. industrial users quick-ramp load requirements), in close proximity to discovery well ST-1. Power plant will utilize a modular air-cooled binary power plant comprised of six identical Ormat Energy Converter (OEC) units with an installed turbine/generator capacity of 6 x 6 MW (36MW gross power, 30MW net power). Each OEC is based on the principle of the thermodynamic sub-critical Organic Rankine Cycle (ORC). Geothermal steam and brine provide both latent and sensible heat to the OEC units. Ormat Technologies, Inc. has been selected as EPC contractor via competitive bidding for power plant, remote gathering system and system integration. 2. Resource Gathering System (RGS) - in close proximity of power plant and were located by an experienced geothermal scientist, Dr. John Ziagos. RGS includes but is not limited to production and injection wells and related piping. 3. UAC will be built from Broad Bay to the plant site that is designed to handle loads expected for construction and ongoing maintenance. 4. Transmission from plant to COU grid interconnection is approximately 14 miles from COU interconnection point, across Broad Bay from power plant site. Terrestrial portion of the power and communication cable are to be buried along the UAC. OCCP and specialty contractors will provide and install the terrestrial and subsea cables, and prefabricated power distribution control modules (PDCM) for the East and West switching stations, whose locations are identified above in Figure 2. 5. Ormat will integrate entire system from Power Plant to the City grid and allow for state -of-art control schemes to allow local plant control at plant site and in Unalaska at Cities existing power station, or designated location. All components are commercially available equipment with available replacement parts. Project Elements to be Financed Using PPF Loan Proceeds Development costs for 2023, as stated by OCCP, LLC in their application are $11.3 million in support of 10 categories of Project activities: permits, consultants and staff, mobilization, construction camp operations, UAC completion, pad construction, Power Engineers design effort, wellfield development, Unalaska support services, financing and bank fees and other field office costs. At $4.9 million, PPF loan proceeds will fund approximately 50% of the activities planned for 2023, and early 2024, as subject to change on timing of available financing. The activities to be supported via the use of PPF loan proceeds are the first tasks needed to start the Project’s construction phase with the majority of funds, over 80%, focused on completing the UAC and starting the wellfield drilling task. These tasks are inextricably linked whereby wellfield drilling cannot start until UAC is completed. PPF will accelerate 2023 scope of activities allowing wellfield activities to finish. As per OCCP, LLC’s application, Table 2 below provides the activity categories which the PPF loan proceeds would allocated towards. In AEA’s review of the technical documents and the independent technical review as provided by SLB’s GeothermEx, and as informed in a legal memo dated July 21, 2023 from AEA counsel, it is determined that the categorized costs below are eligible under PPF statutes AS 42.45.010(b)(1)(B) for projects generating in excess of 10MW of power, as they are not directly financing the actual construction of the power plant, i.e. the generating asset physically generating the power. Table 2: MGP PPF Loan Proceeds Allocation Technical Feasibility To provide an unbiased third-party technical review of the Project, AIDEA contracted with GeothermEx, a subsidiary of SLB (formerly known as Schlumberger) to conduct a thorough review of the technical specifications of the Project as provided by OCCP, LLC, with specific reference as to the adequacy of the geothermal resource to support the stated power generation, the results of which were subsequently provided to AEA in August 2023 for its review as part of its due diligence process. GeothermEx, in its overall findings, has stated that “The characteristics of the geothermal resource appear to be compatible with the planned project, especially as regards the heat resource that is potentially available for exploitation. Because there is so far only one exploratory well (i.e. ST-1) that has directly investigated the geothermal reservoir (providing information on potential well capacities), some uncertainty remains as to what will be the typical characteristics of wells drilled over a broader area (which will be necessary to supply and sustain the project).” The principal risks identified for the Project were identified as risks related to cost escalation or project development delays concerning the performance of the geothermal resource as verified through the development of the production and injection wells, and the ability of the such wells to perform under exploitation as stated in the design criteria and geothermal fluid guarantee, however, to this point, GeothermEx indicated in its report “The heat resource potentially available from the Makushin geothermal system can be inferred to be adequate to supply the project over its planned lifetime.” Additionally, “The number of wells planned to support the project initially will be adequate if all wells encounter reservoir conditions comparable to what was found by exploratory well ST-1. However, there is limited information so far about how homogeneous or heterogeneous the reservoir conditions are, so it is possible that some wells will have poorer outcomes than expected.” The executed Geothermal Fluid Guarantee, as part of OCCP, LLC’s EPC contract with Ormat, states an operating flow rate of 1,000,000 lbs/hr from each of the three production wells, which is conservative from both OCCP, LLC’s and GeothermEx’s analysis. With respect to the permeability of the geothermal reservoir and the subsurface rock conditions allowing for operation of the power plant, “The risk of operational problems associated with the geothermal fluids and subsurface rock conditions appears generally low. Corrosive fluids are unlikely to be present, and scaling from mineral deposition, if it occurs, should be manageable by standard treatments that are commercially available. Non-condensable gas concentrations are not likely to be problematic (they appear to be low), and the characteristics of the rocks to be penetrated by wells do not appear to be prone to causing severe drilling problems.” Regarding OCCP, LLC’s budget for well drilling and development, “The budget for drilling development wells appears consistent with the number and design of planned wells, if drilling operations can be conducted with a minimum of technical and logistical problems. Cost overruns may occur if more wells than anticipated are required, if field (at least as it is planned initially) is smaller than the inferred area from which heat will need to be extracted. This implies that expansion of the well field may eventually be needed, unless the initial wells successfully extract heat from surrounding areas (which is possible, but not certain). In its review of the report as provided by GeothermEx, AEA does not find any material technical objections to the Project, and the risks to the project are determined by AEA to be no more than other utility-scale geothermal development projects, and OCCP, LLC in its supplemental information and budget, with the provision of a contingency of $32 million, or approximately 16% of total project costs, appears sufficient to cover unforeseen expenses. GeothermEx in its review noted a 25% contingency for drilling costs would be recommended, with respect to the drilling costs. As noted in OCCP, LLC’s financial model, the cost of drilling, including road and pad construction is approximately $20 million, yielding a $5 million contingency for such activities. This $5 million well drilling/development contingency is representative of only 16% of the total allotted $32 million contingency for the total project costs, which appears sufficient, as drilling is the activity with the greatest noted degree of variability / uncertainty. Borrower Project Contractor Selection In AEA’s review of those contractors selected by OCCP, LLC to assist, perform, and/or consult in the design, development, supply and/or construction of the project, AEA found no deficiencies in the ability of the selected vendors to perform those activities / tasks as stated. Project Permitting & Site Control OCCP has a 50-year lease with OC for the 7,037 acres where resource, wellfield, and power plant are situated. This lease encompasses surface and subsurface rights. OC also owns all the surface land associated with the UAC from the resource to tidewater at Broad Bay. The major permit has been approved with USACE permit application issued on May 11, 2021, and renewed on February 28, 2023, under the Nation-Wide Permit 14 methodology. Other major right of way permits are either approved or have been submitted and do not represent a threat to schedule impact. Permitting is not anticipated to pose a risk to the Project. Power Plant Availability Per Section 9(f) of the PPA, OCCP, LLC agrees to maintain a 95% Equivalent Availability Factor for the power plant. DOE’s Geothermal Technologies Office (GTO) analysis indicates that a majority of currently operational geothermal power plants “can run at greater than 90% availability”, substantiating the Projects availability factor. Baseload Geothermal Power Documented benefits of geothermal power in contrast to other proven renewable technologies such as wind and solar, include its high capacity (availability) factor of over 90%, and its ability to load-follow as a responsive, dispatch-able technology which can provide sustained, baseload power. Wind and solar, conversely, are intermittent power technologies which do not have the ability to provide power if there is insufficient wind or insolation for the generating assets to generate power from, requiring other forms. Additionally, the modular nature and design of the generating units for the project, allows for timely expansion of the Project’s generating capacity should future increases in electrical load warrant such expansion(s). DOE LPO TELP Loan Progress In further reassurance to AEA as to the technical and commercial viability of the Project, in AEA’s recent conversations and correspondence with DOE LPO the week of October 2, 2023, DOE stated that it has now entered its formal due diligence with OCCP, LLC, with the Project having successfully passed those requirements of DOE LPO’s preliminary review stages which considered the Project’s legal eligibility under DOE LPO’s TELP, as well as preliminary commercial, technical, and financial viability of the Project. Technical Feasibility Determination It is AEA’s determination in its due diligence that the project is technically feasible. Economic and Financial Feasibility The purpose of the project is to provide, long-term, cost competitive, renewable geothermal power to the COU and its industrial base under the established PPA and any future amendments or addendums thereto. The Project will provide long-term renewable electrical power generation and mitigate those harmful anthropogenic emissions from diesel-only power generation, improving the quality and potential longevity of life for those residents of Unalaska. The project will also provide unemployment opportunities for the COU and help to sustain long-term commerce on the island, creating new potential revenue streams for the COU, assisting to sustain those necessary services COU provides to its residents. The population of Unalaska has remained effectively flat for the past 20 years, with State of Alaska reported population figures of 4,283; 4,376; 4,113 in 2000, 2010, and 2022 (estimate) respectively, an indication of economic stability for COU. Further support as to the economic and financial viability of the Project is the financial position of the principal off-taker, COU. COU in FY2021, per reported an independently audited net position of $419 million, indicating strong financial health for COU. Cost of Power Generation Per FY2022 AEA-reported PCE statistics, COU reported a pre-PCE utility rate of $0.59 per kWh, with an effective (PCE-credit applied) rate of $0.35 / kWh. At the PPA rate of $16.3 million up to 100 MkWh, COU would only need to consume 27.6 MkWh to equal the pre-PCE price of $0.59 per kWh. To match the effective rate of $0.35 per kWh, COU would only need to consume 46.6 MkWh. Additionally, with respect to the cost of power generation for COU, which was reported (varying subject to diesel price volatility) at $0.33 per KWh for FY2022, COU would need to consume 49.2 MkWh, or approximately 17% more power than is already reported consumed (42 MkWh). In effect the Project can generate and sell power to COU at a rate cheaper than COU can self-generate, even if COU only consumed only 50% of the COU’s proposed baseline power consumption of 100 MkWh. At the proposed, base-case rate of $0.163 per kWh, the wholesale rate to COU is 50% less than what COU can self-generate, assuming an average diesel fuel price of FY2022 reported $3.08, if the diesel fuel price were to increase, the discount for MGP power also increase. This observation of cost savings for COU was also stated in AIDEA’s contracted third-party vendor which reviewed OCCP, LLC’s financial model. In nominal terms, if the COU and the other proposed off-takers, as indicated in Table 3 below, were to integrated on-grid, being Westward seafoods, Alyeska seafoods, and the air- source heat pump program as per the PPA, the new baseline consumption of 97MkWh would yield a price per kWh from the Project of about $0.17 per kilowatt, substantially less than COU’s cost of generation. The inclusion of additional off-takers such as Trident and Unisea, which have provided letters of intent to purchase, would reduce the Project’s nominal cost of power to COU. Table 3: Off-Taker Market for Project Cost Estimate for the Project The Borrower provided project costs (see Table 1) indicating a total development cost of $235.2 million, or $203 million, excluding the 16% contingency. Per research from the National Renewable Energy Laboratory from 2022, the estimated capex per kW installed capacity was $6,652, which when applied yields a total Project cost of the Project (30,000 kW installed) of $199,560,000, which is effectively comparable to the estimated cost as provided by OCCP, LLC, with an observed delta of 1.8% as indicated below in Table 4. While such a cost comparison is not an entirely 1:1 equivalent comparison, as the underlying assumptions of what constitutes total project cost are not the same, the comparison is useful in providing a proxy by which it can be determined that the estimated cost for the Project appears reasonable. Table 4: Project Cost Comparison (NREL Baseline) It is AEA’s determination that this is an economically viable Project and provides a sufficient cash flow to cover operating expenses and debt repayment, the Project’s financial feasibility and prospect of repayment is further augmented with the provision of an adequately funded debt-service account in the financial model to account for such debt servicing. Financial Reasonableness Per the OCCP, LLC financial model dated August 30, 2023, which was created in conjunction with OCCP, LLC- contracted third-party consultants indicates a Project IRR of 8.37%, average debt-service coverage ratio of 1.2, and a debt to equity ratio of 0.41. As noted in an AIDEA-provided independent third-party review, while the post-tax Project IRR is reflected as lower than those typically seen for comparable medium to low risk energy infrastructure projects, it is understood that the financiers sought for the financing of the Project, being state and federal government entities, are aware that this is principally the reason as to why OCCP, LLC has sought such public-financing partners, as public financing is generally not subject to the same high expectations for return on investment as would be other conventional lenders. AIDEA’s contracted third-party vendor reviewed the OCCP, LLC financial model for accuracy and noted that the damages clause in the PPA creating liability, per the agreed formula in Section 5 of the PPA, for OCCP, LLC is a risk to the project, although it is understood that the likelihood of such a scenario is of low probability, and the maintenance of a debt service reserve account could accommodate such costs for up to approximately 19 days. Additionally, in light of discussions had with OCCP, LLC, the financial model has been revised by OCCP, LLC to account for comments from independent reviewers. In review of the stated investment tax credits (ITC) the third party vendor has noted, in reviewing the tax advice as provided to AIDEA by Moss Adams, an independent tax consultancy, would concur that the ITC rate of 30% as applied in the model is conservatively applied and that other certain additional tax benefits which may be available to the Project have not been applied, but indicate financial viability which would otherwise be enhanced via the granting of additional certain ITC including wage and apprenticeship adder, domestic content adder, and energy community adder. In review of the OCCP, LLC financial model as a whole, it appears accurate and adequate for its development finance purposes. NREL Estimated Utility Scale Geothermal Plant Capex Costs NREL CAPEX ($/kW, conservative estimate)Fixed O&M ($/kW/yr) 6,652$ 107$ Project Size (kW)Project Size (kW) 30,000 30,000 Project Cost ($)Project O&M ($/yr) 199,560,000$ 3,210,000$ OCCP, LLC estimated project construction cost ($)OCCP, LLC estimated O&M ($/yr) 203,080,196$ 2,572,000$ Variance to NREL Baseline (%)Variance to NREL Baseline (%) 1.8%-25% Source: Annual Technology Baseline, National Renewable Energy Laboratory, https://atb.nrel.gov/electricity/2022/geothermal OCCP, LLC Financial Statements OCCP, LLC has provided its financial statements for FY2020, FY2021, and FY2022, meeting PPF regulatory requirement 3 AAC 106.100(10). OCCP, LLC’s unaudited financial statements reflect an expected negative Net Income of ($903,357) for the year ending December 31, 2022, and positive net position of $3,073,036, indicative of adequate financial position. Financial Feasibility is defined to mean: The Borrower will have sufficient funds to repay the loan; and, Utility consumers will not unnecessarily incur major or unacceptable cost increases. The Project has the ability to raise revenue to cover PPF debt service without undue burden on electric customers: The Project will produce, and is guaranteed recurring fixed revenue for operations and maintenance over its 30 years of proposed operation, under the PPA with COU. The Project will provide cost competitive, renewable power and will help to provide stable, predictable electricity costs under the terms of the PPA. The PPA’s fixed-rate pricing methodology, in concert with the agreed cost sharing split between OCCP, LLC and COU for power in excess of the 100MkWh provides incentive to COU and its industrial base, to maintain predictable, stable rates over the length of the Agreement because the pricing is inflated annually at a rate of 1%, plus the sum of any local tax paid to COU by OCCP, LLC for the prior year. At the proposed, base-case rate of $0.163 per kWh, the wholesale rate to COU is 50% less than what COU reported as their self-generation costs of $0.33 per kWh. The COU and OCCP, LLC have mutually-agreed to amended the PPA three times to extend the COD, evidence as to the commitment of both parties to the success of the Project. Cost increases for COU electric customers is very low probability and would require significant reductions in baseload consumption by COU and its residents. Summary Conclusion: Borrower has demonstrated sufficient and sophisticated technical and financial capacity, as well as, commitment to assure the success of the project and ability to repay the loan. AEA staff recommends approving OCCP, LLC for a $4,944,000 loan at 5.03% fixed interest rate for a 30 year term based on the rationale provided in this packet. Assistance will be required from the Department of Law in drafting the loan agreements to ensure the loan is appropriately secured. 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 AEA 2024 Propsed Board Meeting Dates Wednesday, January 24, 2024 Wedniesday, March 6, 2024 Wednesday, April 17, 2024 Wednesday, May 15, 2024 Thursday, June 20, 2024 Wednesday, August 7, 2024 Wednesdy, September 11, 2024 Wednesday, October 23, 2024 Wednesday, December 11, 2024 5.53.2 Load, Electrification Adoption, and Behind-the-Meter Solar Forecasts for Alaska’s Railbelt Transmission System Phylicia Cicilio, Alexis Francisco, Cameron Morelli, Michelle Wilber, Christopher Pike, Jeremy VanderMeer, Steve Colt, Dominique Pride and Noelle K. Helder Article https://doi.org/10.3390/en16176117 Citation:Cicilio, P.; Francisco, A.; Morelli, C.; Wilber, M.; Pike, C.; VanderMeer, J.; Colt, S.; Pride, D.; Helder, N.K. Load, Electrification Adoption, and Behind-the-Meter Solar Forecasts for Alaska’s Railbelt Transmission System.Energies 2023, 16, 6117. https://doi.org/10.3390/ en16176117 Academic Editor: Alan Brent Received: 12 July 2023 Revised: 18 August 2023 Accepted: 19 August 2023 Published: 22 August 2023 Copyright:© 2023 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). energies Article Load, Electrification Adoption, and Behind-the-Meter Solar Forecasts for Alaska’s Railbelt Transmission System Phylicia Cicilio *, Alexis Francisco, Cameron Morelli, Michelle Wilber , Christopher Pike , Jeremy VanderMeer , Steve Colt , Dominique Pride and Noelle K. Helder Alaska Center for Energy and Power, University of Alaska, Fairbanks, AK 99775, USA; afrancisco2@alaska.edu (A.F.); cnmorelli@alaska.edu (C.M.); mmwilber@alaska.edu (M.W.); cpike6@alaska.edu (C.P.); jbvandermeer@alaska.edu (J.V.); sgcolt@alaska.edu (S.C.); djpride@alaska.edu (D.P.); nhelder@alaska.edu (N.K.H.) *Correspondence: pcicilio@alaska.edu Abstract:Load forecasting is an important component of power system and resource planning for electrical grids. The adoption of electric vehicles (EVs), behind-the-meter (BTM) solar, and heat pumps will significantly change the amount and variability of loads. Electrification adoption and load forecasting in arctic regions and Alaska is limited. This paper provides the first load and electrification adoption forecast for the Alaska Railbelt transmission system, including yearly adoption rates of EVs, BTM solar, and heat pumps and hourly load data for the forecasted year of 2050. The adoption rates were based on the available historical data and compared to other regional and national trends. Two forecasts were created: (1) a moderate adoption forecast based on projections from current adoption rates and comparisons to other regional and national projections and (2) an aggressive forecast, which provides an illustrative comparison of a high adoption rate of 90% for all technologies. The results of these forecasts demonstrate a significant increase in both energy, 80% and 116%, and peak load demand, 113% and 219%, for the moderate and aggressive electrification adoption scenarios, respectively. These findings highlight a need for resource planning and demand management in this region due to the adoption of EVs, BTM solar, and heat pumps. Keywords:load forecast; electrification; heat pumps; electric vehicles; solar; Alaska; Railbelt 1. Introduction The forecasting of load and behind-the-meter (BTM) resource adoption is important for utility resource planning and balancing supply and demand. As utilities plan for grid modernization, electricity consumption must be forecast over many years. As the energy system evolves and electrifies, we see increasing electricity consumption from technologies such as heat pumps and electric vehicles, (EVs) as well as higher BTM generation from technologies such as rooftop photovoltaic (PV) solar systems. The literature is limited on the effect that cold temperatures have on BTM solar PV generation, heat pump consumption profiles, and EV charging, specifically in arctic regions. Many electrification and load forecasting studies [1] only include the contiguous US and the data on Alaska are limited. This paper provides a load and electrification adoption forecast for heat pumps, EVs, and BTM solar for 2050 for Alaska’s Railbelt electric grid. The Railbelt is the largest regional electric grid in Alaska, spanning approximately 700 miles from Fairbanks to Homer. This Railbelt serves approximately 70% of Alaska’s population and 75% of Alaska’s electrical load [2]. Currently, approximately 80% of the Railbelt’s electricity generation comes from fossil fuels, and 20% comes from renewable sources, mainly hydro. The unique electricity landscape of the Railbelt and Alaska’s winter-peaking load contribute to many challenges to achieving the high penetration of renewables. Energies 2023,16, 6117. https://doi.org/10.3390/en16176117 https://www.mdpi.com/journal/energies Energies 2023,16, 6117 2 of 26 Decarbonization and the potential electrification of heating and transportation have significant implications for the amounts and types of new generation necessary to serve the demand. Nationwide, an all-electric approach to decarbonized space heating could require a 70% increase in electricity capacity [3]. The load forecasting studies for the US often omit Alaska and the data on Alaska are limited. It was identified that the single largest limitation to the electrification of heating is very cold temperatures in the winter that cause both a higher heating demand and lower heat pump efficiency [3]. In addition, the adoption of heat pumps may have a significant impact on the shape and time of the peak electricity demand [1]. In Alaska, despite the lower heat pump efficiencies due to cold temperatures, the high cost of heating means that heat pumps can reduce energy costs overall [4,5]. Transportation currently accounts for less than 1% of US electricity demand but ac- counts for 30% of primary energy consumption [1]. The adoption of EVs will increase elec- tricity demand, including in Alaska. In 2021, there were 1250 EVs registered in Alaska [6]. The State of Alaska Electric Vehicle Infrastructure Implementation Plan predicts that in 2026, 1.01% of all registered vehicles in Alaska will be EVs, up from 0.20% EV penetration in 2021 for light-duty vehicles [6]. The cold temperatures seen in Alaska can decrease EV range by up to 50%, and colder temperatures can increase the time required to charge EV batteries [6,7]. Additionally, in cold weather, the efficiency of EVs decreases due to the energy required to keep the battery at an optimal temperature for the performance and health of the battery [7]. Forecasting solar output from BTM PV is also important for grid operators since it reduces demand on the grid. The output from solar power depends on weather conditions and can be especially variable in the winter due to snow and cloud cover. In regions such as the Railbelt that face extreme weather in winter months and very few hours of daylight, solar installations have low capacity factors (7–15%) [8]. Since the Railbelt is a winter peaking system, solar energy does not reduce the system peak demand. Many load forecasting studies exist for the contiguous United States [9–12]. These methods use historical data, population estimates, and policy changes to estimate electrifi- cation adoption rates. Studies on forecasting load, output from BTM solar, electrification with heat pumps, and adoption and charging profiles of EVs are understudied for the arctic regions, including Alaska. The load forecasts that were performed have not included load changes due to the adoption of electrification technologies such as heat pumps and electric vehicles and BTM solar [13,14]. The contribution of this paper is that it provides the first Railbelt region wide load and electrification adoption forecast for the Alaska Railbelt transmission system. The load forecasts produced include yearly adoption rates for EVs, BTM solar, and heat pumps and the hourly load demand for the year 2050. This paper is organized into the following sections: Section 2 provides general in- formation relevant to the forecasts. Section 3 provides the methods, data, and resulting yearly forecasts for the adoption of EVs, heat pumps, and BTM solar. Section 4 provides the methods, data, and resulting hourly load data for EVs, heat pumps, BTM solar, and the total load. Section 6 concludes with a summary of the key findings and implications of the forecasts. 2. Electrification and BTM Solar Baseline Information This section outlines the data and methods used to estimate the baseline information necessary to create the electrification adoption forecasts. These data include a population forecast, the number of buildings, and the number of vehicles. The collected data were categorized by electric utility and general load area. There are four electric cooperatives in the Railbelt: Golden Valley Electric Association, Matanuska Electric Association, Chugach Electric Association, and Homer Electric Association. There are three general load areas in the Railbelt, which are connected vertically with a single transmission line: Northern, Central, and Southern. These boroughs, utility service areas, and load areas are illustrated in Figure 1. Energies 2023,16, 6117 3 of 26 Figure 1.Alaska Railbelt transmission, load regions, and electric utility territories. 2.1. Population Alaska’s population has declined from 742,874 in 2015 to 734,323 in 2020 [15]. It is forecasted that Alaska’s population will increase from 2021 to 2040, then in 2040 the rate of change becomes relatively stable until 2050, as illustrated in Figure 2 [15]. Figure 2.Alaska population forecast [15]. The forecasted population growth from 2023 to 2050 is approximately 3%. Due to the negligible forecasted population change in Alaska, it is estimated that the number of buildings and vehicles will also remain constant through 2050. Energies 2023,16, 6117 4 of 26 2.2. Number of Buildings The number of buildings receiving electricity from the Railbelt transmission system was calculated using property information from the Fairbanks NorthStar Borough (FNSB), Kenai Peninsula Borough (KPB), Matanuska-Sustina Borough (MSB), and the Municipality of Anchorage (MOA). The property information collected from the boroughs and the Municipality of Anchor- age included address, year built, and primary use of property. This information was used to determine the number of residential, commercial, and non-residential or non-commercial buildings in these boroughs and the municipality. Industrial buildings were not evaluated as part of this study. The Denali Borough, the City of Nenana, and the City of Delta are also located along the Railbelt; however, no property information is available for these locations. The Denali Borough includes the towns or cities of Anderson, Healy, Cantwell, and Denali Park. In the absence of property information from these locations, census data from the 2018 American Community Survey for Physical Housing Characteristics for Occupied Housing Units [16] were used. The number of occupied housing units from the census data was used as the number of residential buildings for these locations. The number of commercial buildings was estimated by using the ratio of residential to commercial buildings from FNSB for the locations with more commercial activity, such as Denali Park, and MSB for the locations with less commercial activity, such as Nenana, Delta Junction, Anderson, Cantwell, and Healy. The number of commercial and residential buildings receiving electricity from the Railbelt transmission system are outlined in Table 1. Table 1.Building Counts for the Railbelt. * estimate based on census. Area Electric Utility Load Region Residential Commercial Total Fairbanks North Star Borough GVEA Northern 29,100 14,992 44,092 Healy * GVEA Northern 377 25 402 Cantwell * GVEA Northern 93 6 99 Denali Park * GVEA Northern 44 23 67 Anderson GVEA Northern 50 3 53 City of Nenana * GVEA Northern 159 10 169 City of Delta Junction * GVEA Northern 320 21 341 Matanuska-Susitna Borough MEA Central 51,145 3,375 54,520 Municipality of Anchorage CEA Central 87,618 10,964 98,582 Kenai Peninsula Borough HEA Southern 43,937 4550 48,487 The total number of buildings by load region are: • Northern: 45,223 • Central: 153,102 • Southern: 48,487 • Total: 292,035 2.3. Number of Vehicles The number of vehicles was determined by the number of registered vehicles in 2022, as listed by the Department of Motor Vehicles (DMV) for FNSB, Delta Junction, MSB, KPB, City of Delta Junction, City of Nenana, and MOA [17]. The types of vehicles for which DMV reports data include passenger, motorcycle, commercial trailer, trailer, commercial truck, pickup, bus, and snowmobile. This study considered the electrification of the following vehicle types: car (DMV “passenger” type), truck (DMV “pickup” type), box truck (DMV “commercial truck” type), and bus. The number of vehicles by type and by area are outlined in Table 2. Energies 2023,16, 6117 5 of 26 Table 2.Vehicle Counts for the Railbelt. Area Electric Utility Load Region Car Truck Box Truck Bus Total Fairbanks North Star Borough GVEA Northern 54,009 27,107 7393 385 88,894 City of Nenana GVEA Northern 343 231 43 2 619 City of Delta Junction GVEA Northern 2632 1728 332 29 4721 Matanuska-Susitna Borough MEA Central 47,483 24,556 4048 513 76,600 Municipality of Anchorage CEA Central 186,739 64,251 16,620 871 268,481 Kenai Peninsula Borough HEA Southern 33,432 21,998 3895 223 59,548 The total vehicles by load region are: • Northern: 94,234 • Central: 345,081 • Southern: 59,548 • Total: 498,863 3. Yearly Forecasts The forecasts generated as a part of this study included projections for EVs, BTM PV, heat pumps, and the existing load base. The local and global trends, along with population estimates and policy changes were used to project growth rates as a method to generate an estimate of the load growth and electrification adoption through 2050. Two load forecasts were generated to represent two trajectories for the adoption of electrification and residential solar generation. These forecasts are called the moderate and aggressive forecasts. The moderate forecast was determined by following the current adoption of technologies and forecasts generated by other Alaskan entities. The aggressive forecast was set to assume 90% of buildings (residential and commercial) would adopt heat pumps and residential solar, and 90% of vehicles would be electric vehicles in 2050. Therefore, the aggressive forecast provides a comparison of the current trends with a near total adoption of these technologies to illustrate the impacts to the load. The aggressive scenario is provided as an illustrative comparison and not as a realistic scenario. The inputs, assumptions, and methods used to generate these forecasts are outlined below, along with the resulting projections. 3.1. Electric Vehicles 3.1.1. Methods The Alaska Energy Authority (AEA) produced two EV growth forecasts through 2026, continued and aggressive, for the state of Alaska as part of their Electrical Vehicle Infrastructure Implementation Plan [6]. The forecasts were scaled from all of Alaska to just the Railbelt by assuming 76% of vehicles in the AEA Alaska forecasts were on the Railbelt, which was based on the number of registered vehicles in the state versus in the communities along the Railbelt. The historical growth rates for electric vehicles in Anchorage were obtained from CEA’s electric vehicle information [18]. The AEA forecasts and the historical numbers of EVs on the Railbelt can be seen in Figure 3. The AEA forecasts were then extended to 2050 following 2nd degree polynomial growth, which follows historical growth. The moderate forecast of EV adoption in this study was assumed to be the result of the extended AEA aggressive forecast. Energies 2023,16, 6117 6 of 26 Figure 3.Alaska Energy Authority electric vehicle forecast for the Railbelt and historical numbers of electric vehicles on the Railbelt. 3.1.2. Results In 2050, the number of EVs on the Railbelt for the moderate forecast was projected to be 353,381, which equates to 71% of vehicles based on the 2022 Alaska DMV number of registered vehicles in the Railbelt. The aggressive forecast for this study assumes 90% of vehicles will be EVs, which equates to 449,000 vehicles. These forecasts are illustrated in Figure 4. Figure 4.Railbelt electric vehicle adoption forecasts extended through 2050, with aggressive and moderate forecast amounts in 2050. These EV adoption forecasts were compared to other regional, national, and global forecasts in terms of a percentage of vehicles. These other forecasts included the Bloomberg Electric Vehicle Outlook for Electric Vehicles [19] for leading markets, as the United States is considered a leading market; ISO-NE EV forecasts [20], as a comparison to another cold region in the United States; and national EV adoption forecasts from [21]. These comparisons are illustrated in Figure 5. Energies 2023,16, 6117 7 of 26 Figure 5.Railbelt electric vehicle adoption forecasts by percentage of vehicles with comparisons to other regional, national, and global EV adoption forecasts. The Railbelt EV adoption forecast is slightly lower than ISO-NE, the United States, and global leading market adoption forecasts, as seen in Figure 5. The Railbelt adoption rate in 2030 is approximately 10%, compared to 15–25% adoption for the other regions. This lower adoption rate is reasonable and is expected for the Railbelt in Alaska due to the increased energy use both while parked and while driving in a cold climate, as outlined in [22]. 3.2. Behind-the-Meter Solar 3.2.1. Methods The primary constraints for solar PV adoption in Alaska include the lack of state incentives such as a renewable portfolio standard (RPS). The BTM solar incentives available to Alaska include the federal investment tax credit (ITC) and local solarize programs where discounts are available for community-wide solar installations. The ITC provides a 30% discount for solar PV installation between 2022 and 2032, decreasing to 26% in 2033, and 22% in 2034 [23]. Despite the lack of state incentives or mandates for renewable energy generation, the Railbelt has experienced the exponential growth of BTM capacity for solar PV, illustrated in Figure 6 [24]. Figure 6.Historical behind-the-meter Railbelt solar installations [24]. Energies 2023,16, 6117 8 of 26 The BTM solar forecast generated in this work used several factors to determine growth rates, including: • ITC expiration date, • Projected electricity prices, • Projected solar costs. The Energy Information Administration’s (EIA) energy outlook predicts the national electricity rates to increase linearly beginning around 2027 [25]. The National Renewable Energy Laboratory’s (NREL) annual technology baseline (ATB) for residential and com- mercial PV costs (levelized cost of energy (LCOE), operations and maintenance (O&M), capital expenditures (CAPEX)) shows decreasing costs for both the moderate and advanced scenarios until 2030 then decreases at a lower rate after 2030 [26]. These electricity and solar cost forecasts are illustrated in Figure 7. Figure 7.National electricity price and residential solar cost forecasts [25,26]. The historical Railbelt BTM solar capacity was compared to other BTM solar forecasts across the United States, including the states within ISO-NE’s territory (Maine, Mas- sachusetts, Vermont, New Hampshire, Connecticut, and Rhode Island) [9], representing a cold region, and Hawai’i [27], representing a region with very high BTM solar installation rates. The Hawai’i installed capacity is from the Hawaiian Electric, Hawai’i Electric Light, and Maui Electric covering the islands of Maui, Lana‘i, and Moloka‘i. For equal comparison between regions, the installed capacity forecasts were normalized by the 2013 amount of the installed BTM solar capacity. These comparisons are shown in Figure 8. Figure 8.Historical behind-the-meter solar installations in the Railbelt, in ISO-NE, and Hawai’i normalized by the 2013 installed capacity by region [9,27]. Energies 2023,16, 6117 9 of 26 For perspective, the historical BTM solar installed capacity as a percentage of the peak load was 0.5% in ISO-NE (2022 net peak load in ISO-NE was 24,780 MW [28]), 74.7% in Hawai’i (2020 net peak load in HECO was 1,496 MW: Hawai’i was 183 MW [29], O‘ahu was 1116 MW [30], Moloka‘i was 5.8 MW, Lana‘i was 6.14 MW, Maui was 185.3 MW [31]), and 1.5% in the Railbelt (2021 net peak load in Railbelt was 765.3 MW). Note that Hawai’i and ISO-NE are summer peaking systems, and therefore, BTM solar will impact the peak load in those regions. In the Railbelt, the peak load occurs in winter, and therefore, BTM solar will have the most impact during the lowest load period in the summer, which was 381 MW in 2021. Therefore, the 2021 Railbelt BTM solar capacity as a percentage of the minimum summer load is 4.8%. ISO-NE and Hawai’i will have a greater amount of energy generation per installed capacity due to high capacity factors in those regions with lower latitudes compared to the Railbelt. Therefore, even though the percentage of BTM solar by installed capacity to peak load and minimum load is larger in the Railbelt compared to ISO-NE, ISO-NE experiences a greater impact from BTM solar in terms of total energy generation. A significant finding is that the Railbelt in Alaska is experiencing a similar growth rate (not total amount) in BTM solar to ISO-NE, compared to peak load and as normalized by the 2013 installed capacity. This growth rate is similar despite lower capacity factors in the Railbelt and a lack of state incentives for BTM solar in Alaska. The growth rate as normalized by the 2013 installed capacity in Hawai’i is lower compared to ISO-NE and the Railbelt. Hawai’i’s lower growth rate is likely due to reaching hosting capacity limits of the distribution and transmission systems in Hawai’i due to the high percentage as compared to the peak load (74.7%). Therefore, it is reasonable to expect continued BTM solar growth rates in the Railbelt similar to those that are currently seen. 3.2.2. Results For the moderate electrification forecast, this work estimates a series of decreasing growth rates to reflect impacts from the ITC and solar installation costs. From 2023 through 2027, this work predicts continued exponential growth in BTM solar, based on the historical exponential growth shown in Figure 6. This exponential growth is estimated to continue until 2027, halfway through the duration of the ITC. From 2025 through 2027, it is estimated that solar installations will continue to increase linearly due to the ITC and continued projected solar installation cost reductions. The linear growthrateisbasedontherateofchangefrom2025to2027, whichequatestoapproximately 3318 customers per year. This rate of change was applied from 2028 to 2033, a year after the 30% ITC discount ends, to reflect possible construction delays. From 2034 to 2040, the estimated solar installation costs reduce at a lower rate, and the ITC discount decreases to 26% and 22% for systems installed by 2033 and 2034, respectively. Therefore, for this time period, it was estimated that BTM solar adoption would continue to increase but at half of the previous rate, at 1659 customers per year. Over time, the percentage of households that can afford to install solar PV that have not already done so will decrease. This is expected to have a negative impact on solar adop- tion in the absence of solar incentive programs for low- and middle-income households. Therefore, for the period from 2040 through 2050 the growth rate was estimated to halve again, to 829 customers per year to reflect this impact. By the end of 2050, the projected number BTM solar installations was 53,386. Given that the number of residential and commercial buildings in the Railbelt is 292,035, this is equivalent to 18% of residential and commercial buildings in the Railbelt with BTM solar installations. The total installed BTM solar capacity was calculated using the current typical BTM solar installation size of 5 kW per installation. The BTM solar forecast by number of installations and by capacity is shown in Figure 9. For comparison, the Solar Energy Industries Association’s (SEIA) five year growth projection for Alaska was also included in Figure 9 at a total of 69 MW in 2027, which closely matches the proposed moderate BTM solar forecast. Energies 2023,16, 6117 10 of 26 Figure 9.Railbelt forecasted behind-the-meter solar installations from 2023 through 2050 for the moderate and aggressive adoption scenarios. The aggressive solar forecast assumes 90% of residential and commercial buildings having BTM solar by 2050. This equates to 262,832 houses and a total installed capacity of 1314 MW based on a 5 kW typical installation size. 3.3. Heat Pumps 3.3.1. Methods The heat pump adoption rate assumes a new installation of a heat pump and does not assume the full replacement of the heating systems. Most of the Railbelt has temperatures that routinely fall below the efficient operating range of heat pumps, making a back up heat source necessary. The purpose of this heat pump adoption forecast is to estimate the impact of heat pump installations on load and not to transition all heating sources to electricity. The CEA generated a heat pump forecast for the CEA service territory [32]. This heat pump forecast was expanded to include all of the Railbelt and extrapolated to 2050. The CEA moderate and aggressive forecasts were continued at the same growth rate from the original forecast of 2032 out to the target of 2050 for this study. The forecast was also increased by 97% to expand to the entire Railbelt based on the number of buildings in the CEA versus the entire Railbelt. The forecasts are shown in terms of number of installations and by the installed capacity, assuming a 3.2 kW rating per heat pump in Figure 10. Figure 10.CEA heat pump adoption forecasts extrapolated to 2050 and expanded to represent all of the Railbelt. Energies 2023,16, 6117 11 of 26 The ISO-NE’s 2022 Heating Electrification Forecast was used to provide comparison to the Railbelt heat pump forecasts. The forecasts were normalized by the number of instal- lations in 2022 to provide a comparison of the forecasted growth rates. These normalized heat pump growth forecasts are shown in Figure 11. Figure 11.Normalized heat pump forecasts for ISO-NE and from the CEA extrapolated to the Railbelt. The heat pump forecasts for 2023 from ISO-NE and from CEA were also compared by the percent of total occupied housing. The 2023 ISO-NE heat electrification forecasts estimate 63,700 heat pump installations in 2023 out of approximately 6 million occupied housing units, which equates to 2.2% of households. The CEA moderate and aggressive forecasts estimate 200 and 250 installed heat pumps, respectively, for the moderate and aggressive forecast in 2023 in CEA’s territory. This extrapolates to 400 and 500 installed heat pumps for the moderate and aggressive forecasts for the Railbelt, which equates to 0.2% and 0.25% of the occupied housing units. In comparison to ISO-NE, the number of heat pumps forecasted to be installed in the Railbelt in 2023 is 10 times less than ISO-NE. Therefore, it is feasible that the adoption of heat pumps in the Railbelt may exceed that in ISO-NE on a per household basis due to its comparatively low 2023 forecasted adoption rate. Other considerations taken into account when comparing heat pump adoption rates between the Railbelt and ISO-NE include the cost of heat fuels in each region. ISO-NE is primarily heated with natural gas [33], which has a price of $16.60/MMBtu [34]. In the Railbelt, the central region is primarily heated by natural gas as well but at a slightly lower price of $14.46/MMBtu. The northern and southern regions of the Railbelt have a greater mix of heat energy sources, including #1 heating oil with a current price of $29.84/MMBtu. In FSNB, in the northern load region, where heating oil is common, the U.S. Environmental Protection Agency’s air quality standards are in violation. As a result of those violations, the proposed actions include the use of ultra-low sulfur diesel to replace the use of heating oil and additional measures to reduce PM2.5 and SO2 emissions from coal power plants [35]. Both of these proposed measures would increase the cost of residential heating and electricity, which will positively impact the value of heat pumps in the region. Additionally, affordable natural gas availability in Alaska is uncertain according to statements from the operator of the Cook Inlet natural gas wells, Hilcorp [36]. Natural gas is the primary fuel used to generate electricity on the Railbelt; therefore, an increase in the price of natural gas resulting from a reduced supply could increase the price of electricity, which could either negatively or positively impact the value of heat pumps based on the resulting price changes in both natural gas and electricity. Heat pumps provide an additional value beyond heating in New England as they can also provide air conditioning, of which the need in this region has increased over the years. In comparison, there is a less but not negligible need for air conditioning in the Railbelt. Energies 2023,16, 6117 12 of 26 3.3.2. Results Regional variation in climate, electricity prices, heating fuel prices, heating fuel avail- ability, and air conditioning value will play a role in the adoption rate of heat pumps. Taking into account these trade offs, it is estimated that the Railbelt will have a higher adop- tion rate than ISO-NE. Therefore, the moderate heat pump forecast proposed in this study for the Railbelt follows the extrapolated CEA aggressive forecast. This equates to 41,916 heat pump installations in commercial and residential buildings by 2050, which is 14.4% of all commercial and residential buildings. This would result in a potential maximum additional load of 160 MW from heat pumps based on a 3.2 kW typical installation size per building. However, it is unlikely that all heat pumps would be consuming electricity at the same time. It is noted that this forecast will change and should be updated in the event of the unavailability of affordable natural gas. The aggressive heat pump forecast for the Railbelt assumes that 90% of residential and commercial buildings will install a heat pump by 2050. This equates to 262,832 houses and a potential maximum additional load of 841 MW based on a 3.2 kW typical installation size per building. 3.4. Base Load The current load profile, referred to here as the baseline load, from 2021 was increased by 12% for 2040, as was implemented in the NREL Alaska RPS report [13]. This rate of growth was continued for 2050, resulting in approximately 18% baseline load growth from 2021 to 2050. 3.5. Summary of 2050 Electrification Adoption Rates The adoption rates for each electrification technology for 2050 are summarized in Table 3 for the moderate electrification scenario and Table 4 for the aggressive electrifica- tion scenario. Table 3.Electrification Adoption Rates for 2050 for the Moderate Electrification Scenarios. Northern Central Southern Total Electric Vehicles (# of vehicles) 66,753 244,446 42,182 353381 Heat Pumps (# of heat pumps) 6491 21,975 6959 41,916 Behind-the-Meter Solar (# of installations) 8267 27,988 8864 53,386 Behind-the-Meter Solar (MW) 41 140 44 225 Table 4.Electrification Adoption Rates for 2050 for the Aggressive Electrification Scenarios. Northern Central Southern Total Electric Vehicles (# of vehicles) 84,811 244,446 42,182 448,977 Heat Pumps (# of heat pumps) 45,223 153,102 48,487 292,035 Behind-the-Meter Solar (# of installations) 40,701 137,792 43,638 262,832 Behind-the-Meter Solar (MW) 204 689 218 1111 4. Hourly Load Data The hourly load for each of the components of the load was calculated for the year 2050 using the adoption rates calculated in Section 3. The hourly load data were calculated for both the aggressive and moderate electrification adoption forecasts. 4.1. Electric Vehicle Hourly Load Profile 4.1.1. Methods The hourly load from EVs was created using the collected Alaskan EV efficiency data, temperature versus efficiency data, and load shapes derived from the ISO-NE EV forecasts. The steps taken are outlined below, and the detailed methodology is provided in Appendix A. Energies 2023,16, 6117 13 of 26 1. Calculate total vehicle type counts per each load region. 2. Calculate electricity use per mile while driving. 3. Determine driving profiles (miles traveled per day). 4. Calculate energy use while parked. 5. Calculate daily EV load by load area. 6. Calculate hourly loads by load area using load shapes. In the aggressive forecast, it was assumed that 20% of the EV load can function as a flexible load. Since 20% of the EV load is assumed to be flexible, the load shapes, which reflect smoothing due to the aggregation of many vehicles, would apply to 80% of the EV load. The 20% flexible load is served during hours chosen each day to minimize the electricity production cost. 4.1.2. Results The hourly load demand from EVs for the moderate forecast are shown in Figure 12, showing results for the year 2050, 1 January 2050, and 1 June 2050. (a) Year 2050. (b) 1 January 2050.(c) 1 June 2050. Figure 12.The hourly EV load for the moderate forecast for the year 2050, 1 January 2050, and 1 June 2050. The hourly load demand from EVs for the aggressive forecast are shown in Figure 13, showing results for the year 2050, 1 January 2050, and 1 June 2050. Energies 2023,16, 6117 14 of 26 (a) Year 2050. (b) 1 January 2050.(c) 1 June 2050. Figure 13.The hourly EV load for the aggressive forecast for the year 2050, 1 January 2050, and 1 June 2050. 4.2. Behind-the-Meter Solar 4.2.1. Methods NREL’s System Advisor Model (SAM) [37] was used to create the hourly genera- tion profiles using typical meteorological year (TMY) irradiance data for three represen- tative locations: Anchorage (Central), Soldotna (Southern), and Fairbanks (Northern). A PVWatts [38] photovoltaic model with no financial model was used in the SAM sim- ulation. Most of the default settings applied, except for the following changes in the system design: • the DC nameplate capacity was set to the allocated solar for each region • 45° tilt • 180 Azimuth • ground coverage ratio of 0.3 • bifacial module • albedo of 0.5 The individual hourly BTM solar generation data were multiplied by the number of commercial and residential buildings with BTM PV installations, as estimated by the moderate and aggressive forecasts. Gaussian noise was added to the BTM solar generation for the moderate and aggressive forecast to account for geographical diversity beyond the three selected locations. A 9-h average moving filter was applied to the aggressive forecast to incorporate control by DERMS through household batteries to smooth daily load fluctuations, which would be expected and necessary at this adoption rate. 4.2.2. Results The hourly generation from BTM solar for the moderate forecast is shown in Figure 14, which shows results for the year 2050, 1 January 2050, and 1 June 2050. Energies 2023,16, 6117 15 of 26 (a) Year 2050. (b) 1 January 2050.(c) 1 June 2050. Figure 14.The hourly BTM solar generation for the moderate forecast for the year 2050, 1 January 2050, and 1 June 2050. The hourly generation from BTM solar for the aggressive forecast is shown in Figure 15, which shows results for the year 2050, 1 January 2050, and 1 June 2050. (a) Year 2050. (b) 1 January 2050.(c) 1 June 2050. Figure 15.The hourly BTM solar generation for the aggressive forecast for the year 2050, 1 January 2050, and 1 June 2050. Energies 2023,16, 6117 16 of 26 4.3. Heat Pumps 4.3.1. Methods The hourly electricity consumption from heat pumps was based on three individual representative heat pumps located in Anchorage (Central), Soldotna (Southern), and Fair- banks (Northern) to represent the three load regions. The electrical rating of the heat pump was assumed to be 3.2 kW. The Alaska Mini-Split Heat Pump Calculator [39] was used to generate the hourly electrical consumption rates for each representative heat pump in each location using TMY weather data. The individual hourly heat pump data were multiplied by the number of commercial and residential buildings with installed heat pumps, as estimated by the moderate and aggressive forecasts. Gaussian noise was then added to the heat pump load for the moderate and aggressive forecasts to account for geographical diversity of the heat pump behavior beyond the three selected locations. 4.3.2. Results The hourly load demand from heat pumps for the moderate forecast is shown in Figure 16, which shows results for the year 2050, 1 January 2050, and 1 June 2050. (a) Year 2050. (b) 1 January 2050.(c) 1 June 2050. Figure 16.The hourly load demand from heat pumps for the moderate forecast for the year 2050, 1 January 2050, and 1 June 2050. The hourly load demand from heat pumps for the aggressive forecast is shown in Figure 17, which shows results for the year 2050, 1 January 2050, and 1 June 2050. Energies 2023,16, 6117 17 of 26 (a) Year 2050. (b) 1 January 2050.(c) 1 June 2050. Figure 17.The hourly load demand from heat pumps for the aggressive forecast for the year 2050, 1 January 2050, and 1 June 2050. 5. Total Load Characteristics The load characteristics from the current 2021 load and the 2050 aggressive and moderate load forecasts are presented in Table 5. Table 5.Load characteristics for 2021 and the aggressive and moderate 2050 load forecasts Characteristic 2021 2050 Moderate 2050 Aggressive Total Annual Energy [TWh] 4.72 8.48 10.2 Heat Pump Energy [TWh] - 0.1 2 Electric Vehicle Energy [TWh] - 3.1 4 Residential Solar Energy [TWh] - 0.2 1 Peak Load Demand [MW] 765.3 1626 2403 Low Load Demand [MW] 381.1 580 144 Maximum Hourly Change [MW] 55.5 202 270 Number of Installed Heat Pumps - 41,916 292,035 Number of Electric Vehicles - 353,381 448,977 BTM Solar Installed Capacity [MW] 11 225 1111 The hourly total load demand, including the base load, heat pumps, electric vehicles, and generation from residential solar for the moderate forecast are shown in Figure 18 showing results for the year 2050, 1 January 2050, and 1 June 2050. Energies 2023,16, 6117 18 of 26 (a) Total load for the year 2050. (b) Total load for the day 1 January 2050.(c) Total load for the day 1 June 2050. Figure 18.The total hourly load demand for the moderate forecast for the year 2050, 1 January 2050, and 1 June 2050. The total hourly load demand for the aggressive forecast is shown in Figure 19, showing results for the year 2050, 1 January 2050, and 1 June 2050. (a) Total load for the year 2050. (b) Total load for the day 1 January 2050.(c) Total load for the day 1 June 2050. Figure 19.The total hourly load demand for the aggressive forecast for the year 2050, 1 January 2050, and 1 June 2050. Energies 2023,16, 6117 19 of 26 The moderate forecast results in an 80% increase in the total energy and a 113% increase in the peak load. The minimum load in the system was increased by 53%. The hourly demand change increased by 260%, which is significantly higher than the increases in total energy and peak load. This suggests that DERMS would be beneficial to control and smooth the load fluctuations in the moderate forecast. The aggressive forecast results in a 116% increase in the total energy and a 219% increase in the peak load. In addition, due to the increase in residential solar there was a reduction in the minimum load, which occurred in the summer when solar production was high. The minimum load was decreased by 62%. The hourly demand change increased by 381%, which was also significantly higher than the increases in total energy and peak load. Additional action may be needed through demand management and DERMS to manage load fluctuations, beyond those implemented in the methods. These shifts result in a more heavily winter peaking system with relatively lower minimum summer loads. This emphasizes the benefit that long-duration energy storage would have for this region. The hourly load demand has inherent uncertainty. This study focused on providing an estimate on load growth due to electrification and quantifying the associated characteristics of the load due to this change and did not focus on quantifying the uncertainty of the load data. Uncertainty quantification would be necessary for these results to be used in utility operations. These results could be useful for forecasting and analyzing load growth scenarios in similar regions, such as Arctic regions with winter peaking electrical grids. 6. Conclusions This load and electrification adoption forecast for the Alaska Railbelt transmission system is the first Railbelt region-wide forecast proposed for this region. The adoption rates for BTM solar, EVs, and heat pumps are proposed for a moderate adoption forecast based on projections from the current adoption rates and comparisons to other regional, national, and global projections. The proposed aggressive forecast provides an illustrative comparison at a high adoption rate of 90% for all technologies. The results of these forecasts demonstrate a significant increase in both energy and peak load demand for both the moderate and aggressive forecasts. The moderate forecast results in an 80% increase in total energy and 113% increase in peak load. The aggressive forecast results in a 116% increase in total energy and 219% in peak load. Notably, there are even greater increases in the maximum hourly load change at 260% and 381% for the moderate and aggressive forecasts, respectively. This suggests that significant demand management is needed to smooth and control the load fluctuations as a results of the adoption of BTM solar, EVs, and heat pumps. Additionally, the resulting more heavily winter peaking system with relatively lower minimum summer loads emphasizes the benefit that long-duration energy storage would have for this region. An analysis on the stability and reliability impacts to the Railbelt due to these load changes, the resource planning to meet this load, cost implications, and environmental and social consequences, and a sensitivity analysis are out of scope for this paper but will be investigated in a future work. These load forecasts were based on the current trends and status of available energy resources, such as natural gas. As adoption trends and the availability of energy resources change, these load forecasts should be updated to reflect those changes. The forecasts are useful for energy planning for the region, most pertinently, the significant increase in load due to electrification despite the BTM solar adoption. Author Contributions:Conceptualization, P.C., A.F., J.V. and S.C.; methodology, P.C., A.F., M.W., C.P. and S.C.; formal analysis, P.C., A.F., M.W. and S.C.; writing—original draft preparation, P.C., A.F., C.M., M.W. and S.C.; writing—review and editing, P.C., J.V., S.C. and D.P.; visualization, N.K.H.; supervision, P.C.; project administration, P.C.; funding acquisition, P.C. and S.C. All authors have read and agreed to the published version of the manuscript. Energies 2023,16, 6117 20 of 26 Funding:This project is part of the Arctic Regional Collaboration for Technology Innovation and Commercialization (ARCTIC) 2 Program—Innovation Network, an initiative supported by the Office of Naval Research (ONR) Award #N00014-22-1-2049. This project is funded by the state of Alaska FY23 economic development capital funding. Data Availability Statement:The hourly solar, heat pump, and electric vehicle load and generation data presented in this study are openly available in Zenodo at 10.5281/zenodo.8140771 [40]. Acknowledgments:A special thank you to the following organizations for providing the staff expertise to comment and provide input on this work: Golden Valley Electric Association, Chugach Electric Association, Larry Jorgensen and David Thomas at Homer Electric Association, Matanuska Electric Association, Brian Hickey at Railbelt Regional Coordination, and Bryan Carey at Alaska Energy Authority. A special thank you to Alan Mitchell for providing the heat pump load data. Conflicts of Interest:The authors declare no conflict of interest. The funders had no role in the design of the study; in the collection, analyses, or interpretation of data; in the writing of the manuscript; or in the decision to publish the results. Abbreviations The following abbreviations are used in this manuscript: AEA Alaska Energy Authority ATB Annual technology baseline BTM Behind-the-meter CAPEX Capital expenditures CEA Chugach Electric Association DERMs Distributed energy resource management systems DMV (Alaska) Department of Motor Vehicles EV Electric vehicles GVEA Golden Valley Electric Association HEA Homer Electric Association HECO Hawaiian Electric Company HVDC High voltage direct current IPP Independent power producer ISO-NE Independent System Operator-New England IRA Inflation reduction act ITC Investment tax credit kW kilowatt kWh kilowatt-hour LCOE levelized cost of energy MEA Matanuska-Susitna Electric Association MW megawatt MWh megawatt-hour NEM net energy metering NERC North American Electric Reliability Corporation NREL National Renewable Energy Laboratory O&M Operations and Maintenance PV Photovoltaics RPS Renewable portfolio standard SAM System advisor model SEIA Solar Energy Industries Association TMY Typical meteorological year Appendix A. Electric Vehicle Hourly Load Data Calculations Appendix A.1. Step 1. Total Vehicle Type Counts The number of vehicles as provided by the registered vehicle information from the DMV are outlined in Table 2. Each DMV region was assigned a weather city in order to use TMY hourly temperatures to model electricity use. The DMV regions were also assigned Energies 2023,16, 6117 21 of 26 a load region. The weather city and load region associated with each DMV region are outlined in Table A1. Table A1.Utility, load region, and weather city for each DMV region. Area Electric Utility Load Region Weather City Fairbanks NorthStar Borough GVEA Northern Fairbanks City of Nenana GVEA Northern Fairbanks City of Delta Junction GVEA Northern Delta Junction Matanuska-Susitna Borough MEA Central Wasilla Municipality of Anchorage CEA Central Anchorage Kenai Peninsula Borough HEA Southern Kenai Appendix A.2. Step 2. Electricity Use per Mile While Driving For vehicle types “car” and “truck”, the calculation of kWh per mile while driving was based on a fitted equation that relates kWh per mile to the hourly temperature in degrees C. There are two components of the energy per mile equations. The first component is the assumed maximum efficiency, which occurs at tempera- tures ranging from 20 °C to 25 °C. It is assumed that the maximum efficiency for a car is 0.22 kWh/mile and for a “truck” is 0.43 kWh per mile. The 0.22 kWh per mile value for cars comes from the crowd sourced data collected by Michelle Wilber of ACEP for several Alaska vehicles. The temperature associated with this efficiency is 25 °C. The 0.43 kWh/mile value for vehicle type “truck” (i.e., pickup trucks) comes from the 0.5 kWh/mile rated efficiency for the Ford F150 Lightning [41]. A 1.15x range improvement factor was applied to this value, which equates to a reduction in kWh per mile from 0.5 kWh per mile to 0.43 kWh per mile (0.43 = 0.5/1.15). The second component is an equation for relative energy consumption versus tempera- ture. Relative energy consumption is inversely proportional to relative range and, therefore, can be directly calculated from the reported data on range levels, or range reductions, versus temperature. The following example illustrates the procedure. The data on range versus temperature compiled by Geotab Inc. [42] shows that the optimal range is achieved at 21 °C (about 70 ◦F) and is 1.15 times the “rated range” reported by manufacturers. The Geotab range data are summarized in Table A2. Table A2.Geotab data on range versus temperature. Range, km Temp [°C] 2019 Bolt 2019 Leaf 2019 Tes S 25 414 254 349 21 420 257 354 15 403 246 346 10 371 228 328 5 334 204 303 0 295 182 278 −5 263 159 253 −10 235 141 233 −15 209 127 214 −20 187 114 197 For a given vehicle, the relative energy use is inversely proportional to the relative range. For example, using the 2019 Bolt data and taking the 21 °C range as the “base”: The relative range at 0°C versus the range at 21 °C is equal to 295 divided by 420, which is 0.702. Therefore, the relative energy use is 1 divided by 0.702, which equals 1.42 = range at 21/range at 0 = 420/295. Converting the Geotab data into relative kWh per distance traveled yields the follow- ing plot shown in Figure A1, showing the basic relationship between kWh per distance traveled and temperature. Energies 2023,16, 6117 22 of 26 Figure A1.Relative EV energy use at varying temperatures, from the Geotabs range data. The above Geotab data illustrate the basic efficiency versus temperature relationship. For the load projections for vehicle type “car” and “truck”, the aggregated Geotab data was used with five other sources on relative range versus temperature [22]. Three data points from Geotab data were generated [42]. The data points derived were range reductions of 29%, 57%, and 34.5% at temperatures 0 °C,−22 °C, and +42 °C, respectively. The range reductions were converted to relative kWh per mile and fitted with a cubic polynomial to the data. The resulting equation is relativekWh/mile =1.58 −0.038T +0.0003T2 +0.000013T3 where the relative kWh/mile is 1.00 at the temperature yielding maximum range, and T is the temperature in degrees Celsius. Figure A2 shows the relative energy use per mile and the temperature relationship. The blue dots represent the aggregated data and, therefore, have less noise. The pink dots are from individual vehicles. Figure A2.Fitted relative EV energy use per mile versus temperature for light duty vehicles (car and truck). Thebluedotsareaggregatedfrommultiplevehicles; thepinkdotsarefromindividualvehicles. Energies 2023,16, 6117 23 of 26 For the vehicle type “boxtruck”, which was equated to the DMV’s “commercial truck” category, the fitted equation is for absolute kWh per mile and is based on the data from the Municipality of Anchorage electric box truck, a Peterbilt 220. The fitted equation is written below and shown in Figure A3. BoxtruckkWh/mile =1.966 −0.034T [°C] Figure A3.Fitted kWh per mile versus temperature for type “boxtruck”. For the vehicle type “bus”, the fitted equation is from the data for an electric school bus operated in Tok, Alaska is written below and shown in Figure A4: BuskWh/mile =2.092 −0.034T[°C] Figure A4.Fitted kWh per mile versus temperature for the vehicle type “bus”. Appendix A.3. Step 3. Driving Profiles The simplified driving profiles were assumed as follows: • Car and Truck: 30 miles per day; 15 miles at 8:30 am and 15 miles at 5:30 pm • Boxtruck and Bus: 60 miles per day; 30 miles at 8:30 am and 30 miles at 3:30 pm Energies 2023,16, 6117 24 of 26 Appendix A.4. Step 4. Energy Use While Parked For all the vehicle types, garages were not assumed, and the parked energy equation, based on limited Alaska data, is parkedkwh/hr =0.186 −0.011Temp[°C] To give a sense of magnitudes, this equation yields 1351 kWh per year for parked energy use with Anchorage weather. Electric vehicles may use energy while parked for various purposes, including accessories and communication, but the available Alaska data show a strong temperature effect, indicating that an important and primary use is in keeping the battery at an optimal temperature for performance and health. Appendix A.5. Step 5. Daily Loads by Load Area With the above building blocks in place, the kWh per hour used by each vehicle type for each hour of the year was tabulated using the hourly temperature data for Anchor- age, Wasilla, Delta Junction, Fairbanks, and Kenai. These numbers are from the energy discharged from the batteries and used by the vehicle. The hourly vehicle usage was aggregated to the daily energy requirements that need to be met by charging. The calculated daily kWh per vehicle for the cars was compared to the output from the EVI-Pro Lite tool [43]. The EVI-Pro Lite tool resulted in a daily kWh per vehicle energy usage within 2% of this study, demonstrating comparable results. Appendix A.6. Step 6. Hourly Loads by Load Area The final step is to apply load shapes to each daily load to determine the hourly loads to be served by the Railbelt Grid. The load shapes by vehicle class reported and adopted by the New England Independent System Operator (ISO-NE) were used [44]. The hourly load shapes were derived from the published data plots for January, May, and October and for the ISO-NE vehicle types “light-duty”, “medium-duty commercial”, and “school bus”. The load shapes are shown in Figure A5. Figure A5.The assumed load shapes that distribute daily energy requirements to hourly loads. The area under each curve equals 1.00. Energies 2023,16, 6117 25 of 26 The load shapes were applied as follows: • January load shape applies to Alaska months November–March (winter). • May load shape applies to Alaska months June–August (summer). •October load shape applies to Alaska months April, May, September, October (spring, fall). The load shapes from the New England data are the only patterns to allocate the Alaska daily load data among the 24 h in the day. There is no downward bias to the Alaska load projections due to using load shape data from a warmer climate. 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[CrossRef] Energies 2023,16, 6117 26 of 26 23.Department of Energy, Solar Energy Technologies Office. Solar Investment Tax Credit: What Changed?|Department of Energy. 2023. Available online:https://www.energy.gov/eere/solar/articles/solar-investment-tax-credit-what-changed (accessed on 1 February 2023). 24.Pike, C.2021 Alaska Railbelt Net Metering Update; Technical Report; Alaska Center for Energy and Power: Fairbanks, AK, USA, 2021. 25.U.S. Energy Information Administration. Total Energy Supply, Disposition, and Price Summary. 2023. Available on- line:https://www.eia.gov/outlooks/aeo/data/browser/#/?id=1-AEO2023®ion=0-0&cases=ref2023&start=2021&end= 2050&f=A&linechart=~~~ref2023-d020623a.58-1-AEO2023~~~~~~~~~~&map=&ctype=linechart&sourcekey=0 (accessed on 1 February 2023). 26.National Renewable Energy Laboratory. Annual Technology Baseline: Residential PV. Available online:https://public. tableau.com/views/2022CostComponents/CostComponents?:embed=y&:toolbar=no&Technology=ResPV&:embed=y&: showVizHome=n&:bootstrapWhenNotified=y&:apiID=handler2 (accessed on 1 February 2023). 27.Hawaiian Electric. Quarterly Installed Solar Data. Available online:http://www.hawaiianelectric.com/clean-energy-hawaii/ our-clean-energy-portfolio/quarterly-installed-solar-data (accessed on 1 February 2023). 28.ISO New England. Monthly Peak Load and Energy Data 2023. Available online:https://www.iso-ne.com/isoexpress/web/ reports/load-and-demand/-/tree/net-ener-peak-load (accessed on 1 February 2023). 29.Hawai‘i Electric Light Company, Inc. 2021 Adequacy of Supply Report Summary. 2021. Available online:https://puc.hawaii. gov/wp-content/uploads/2021/02/GEN-RPT.HELCO_.ADEQUACY-OF-SUPPLY-2021.pdf (accessed on 1 February 2023). 30.Hawaiian Electric Company, Inc. 2021 Adequacy of Supply Report Summary. 2021. 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Available online:https://www.adn.com/business-economy/energy/2022/05/17/hilcorp-warns-alaska-utilities-about- uncertain-cook-inlet-natural-gas-supplies/(accessed on 1 February 2023). 37.National Renewable Energy Laboratory. System Advisor Model. Available online:https://sam.nrel.gov/(accessed on 1 February 2023). 38. PVWatts Calculator. Available online:https://pvwatts.nrel.gov/(accessed on 1 February 2023). 39.Mitchell, A. Alaska Mini-Split Heat Pump Calculator. 2022. Available online:https://heatpump.cf/(accessed on 1 February 2023). 40.Cicilio, P.; Francisco, A.; Wilber, M.; Colt, S. Railbelt 2050 Load, Electrification, and Behind- the-Meter Solar Hourly Load Demand for Aggressive and Moderate Electrification Forecasts. 2023. Available online:https://zenodo.org/record/8140771 (accessed on 12 July 2023) . [CrossRef] 41.The Car Connection. 2022 Ford F-150 Lightning Review, Ratings, Specs, Prices, and Photos. Available online:https://www. thecarconnection.com/overview/ford_f-150-lightning_2022 (accessed on 1 February 2023). 42.Geotab. Temperature Tool for EV Range. 2023. Available online:https://www.geotab.com/fleet-management-solutions/ev- temperature-tool/(accessed on 1 February 2023). 43.U.S. Deparment of Energy, Energy Efficiency & Renewable Energy. Electric Vehicle Infrastructure Projection Tool (EVI-Pro) Lite. Available online:https://afdc.energy.gov/evi-pro-lite (accessed on 1 February 2023). 44.ISO New England. 2022 Final Transportation Electrification Forecast. 2022. Available online:https://www.iso-ne.com/static- assets/documents/2022/04/final_2022_transp_elec_forecast.pdf (accessed on 1 February 2023). Disclaimer/Publisher’s Note:The statements, opinions and data contained in all publications are solely those of the individual author(s) and contributor(s) and not of MDPI and/or the editor(s). MDPI and/or the editor(s) disclaim responsibility for any injury to people or property resulting from any ideas, methods, instructions or products referred to in the content. AEA Infrastructure Funding Opportunities Status GO Federal Receipt Authority Grant Program Name AK Funding Award / Request Match Comments Awarded Defense Community Infrastructure Pilot - National Defense Authorization Act $ 12,602,648 0% AEA lead applicant partnered with GVEA. Black Rapids Training Site. Requesting additional $3M in federal receipt authority FY24 Supplemental budget. Awarded Energy Efficiency and Conservation Block Grant - IIJA 40552b $ 1,627,450 0% Funding award notice received 9/27/23 with an effective date of 10/1/23. Awarded National Electric Vehicle Infrastructure Program (NEVI) FY 2022 - IIJA 11401 $ 7,758,240 20% AEA and DOT are partners, remaining years funded through DOT. Total federal funding expected $52M. Awarded Preventing Outages and Enhancing the Resilience of the Electric Grid, Formula Grants to States and Indian Tribes FY 2022-2023 - IIJA 40101d $ 24,221,046 15% Additional formula funding of $36M expected over the next 3 years, listed as pending on this table. Awarded State Energy Program Funding - IIJA 40109 $ 3,661,930 0%AEA applicant, shared between AEA and AHFC Awarded Vehicle Technology Office FY 2022 - Congressional Appropriation $ 1,670,000 20%For the deployment of EV Charging infrastructure Pending Grid Resilience and Innovation Partnerships Program Topic 3 - IIJA 40103b $ 206,500,000 100% AEA notified by DOE for negotiation of financial assistance 100% state match of $206.5M required. Pending Charging and Fueling Infrastructure - IIJA 11401 $ 12,000,000 20% DOT lead applicant, AEA is a partner. Application submitted June 12, 2023 Pending Training for Residential Energy Contractors (TREC) - IRA 50123 (Previously known as Energy Auditor Contractor Training Program) $ 1,293,870 0% AEA applicant as State Energy Office. AHFC administer the program. Application deadline 1/31/24. Pending Energy Efficiency Revolving Loan Capitalization Program - IIJA 40502 $ 4,569,780 0% Application submitted 5/18/23, awaiting approval. AEA and AHFC are partners. Formula funding. Pending Greenhouse Gas Reduction Fund - Solar For All Competition - IRA 134a $ 100,000,000 0%AEA/AHFC partners. Application Submitted 10/11/2023 Pending Grid Resilience and Innovation Partnerships Program Topic 1 - IIJA 40101c $ 100,000,000 50% Application submitted 4/5/23, awaiting approval. Competitive funding, applied for by Railbelt utilities. Pending Grid Resilience and Innovation Partnerships Program Topic 2 - IIJA 40107 $ 16,000,000 100% Application submitted 3/16/23, awaiting approval. Competitive funding, applied for by Railbelt utilities. Pending Grid Resilience and Innovation Partnerships Program Topic 3 - IIJA 40103b $ 250,000,000 100% Application submitted 5/18/23, awaiting approval. Competitive funding, applied for by AEA Pending Home Efficiency Rebates - IRA 50121 $ 37,368,480 0% AEA applicant as State Energy Office. AHFC administer the program. Application due 1/31/25. Pending Home Electrification and Appliance Rebates - IRA 50122 $ 37,150,940 0% AEA applicant as State Energy Office. AHFC administer the program. Application due 1/31/25. Pending Preventing Outages and Enhancing the Resilience of the Electric Grid, Formula Grants to States and Indian Tribes FY 2024-2026 - IIJA 40101d $ 36,331,569 15% Program is formula funding that AEA will apply for as the allocation for each fiscal year is released. Note: New information is in bold font in cells highlighted yellow Page 1 of 2 AEA Infrastructure Funding Opportunities Status GO Federal Receipt Authority Grant Program Name AK Funding Award / Request Match Comments Applying Energy Future Grant, Congressional Appropriation $ 500,000 0% Application deadline 11/10/2023. AEA to partner with AML to evaluate energy permitting in 45 municipalities. Applying High Energy Cost Grants - USDA RUS NA 0%Applications due 10/31/23. Considering Assistance for Latest & Zero Building Code Adoption (formula) - IRA 50131 $ 11,399,369 0%LOI due 11/21/23, application due 9/30/25. Considering Clean Heavy Duty Vehicles - IRA 60101 NA TBD Funding opportunity not issued at this time. Considering Clean Ports Program - IRA 60102 NA TBD Funding opportunity not issued at this time. Considering Climate Pollution Reduction Grants Competition $4.3 Billion - IRA 60114 NA TBD Funding available to implement measures contained in a Priority Climate Action Plan (PCAP). DEC was applicant for PCAP grant. NOI due 2/1/24, application due 4/1/24. Considering Electric Vehicle Charger Reliability and Accessibility Accelerator - IIJA 11401 NA 0% Applications due 11/13/23. 10% set aside from NEVI Program for repair and replacement. Considering Energy Improvements in Remote and Rural Areas FY24-FY26 - IIJA 40103c NA TBD Funding for FY 2024 - 2026 not open at this time. Considering Grid Resilience and Innovation Partnerships Program Topic 1 - IIJA 40101c NA 50%Funding for FY 2024 - 2026 not open at this time. Considering Grid Resilience and Innovation Partnerships Program Topic 2 - IIJA 40107 NA 50%Funding for FY 2024 - 2026 not open at this time. Considering Grid Resilience and Innovation Partnerships Program Topic 3 - IIJA 40103b NA 50%Funding for FY 2024 - 2026 not open at this time. Considering Renewable Energy Siting through Technical Engagement and Planning (R-STEP) - DOE Office of Technology Transitions NA 0%Applications due 11/3/23. Note: New information is in bold font in cells highlighted yellow Page 2 of 2 Solar for AllALASKA ENERGY AUTHORITY PROGRAM NARRATIVE 1 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Program Strategy Narrative 1. Impact Assessment Market Environment There are two distinct grid categories in the State of Alaska: Railbelt and remote. The majority of the state’s population (70%) resides in urban areas of what’s known as the Railbelt. The remaining 30% of the population reside in isolated rural communities served by independent utilities. This relatively small interconnected electrical system is home to significant Department of Defense assets, tribal governments, highly diverse populations, and a remarkable variety of carbon and non-carbon energy resources. Alaska’s Railbelt is serviced by five electric utilities (four cooperatives and one municipal utility) and is an interconnected grid that loosely follows the route of the Alaska Railroad. The State of Alaska, through the Alaska Energy Authority (AEA), owns significant transmission and generation infrastructure on the Railbelt system. The residents and businesses along the Railbelt consume approximately 80% of the state’s electricity across a service area similar to the distance from West Virginia to Maine. On an annual basis, the Railbelt generates approximately 4800 GWh. Interconnection between regions is by single transmission lines, which limits economic transfers and negatively affects system resiliency. The opportunity for residential solar is high in this market. The remaining 30% of the state’s population resides in over 200 rural and tribal communities and rely on local and regional power generation, and over 100 isolated and independent utilities provide those services. Most rural Alaska communities are only accessible by plane or marine vessel, with over half classified by the Denali Commission as distressed communities. Alaska’s solar program offers an opportunity to reduce entry barriers for underserved Alaskans, enabling them to enjoy the advantages of residential rooftop solar along the Railbelt, and community-based solar in rural Alaska. The collaborative approach between AEA and the Alaska Housing Finance Corporation (AHFC) will result not only in lower energy costs for disad- vantaged Alaskans, but it will also provide access to critical resilience assets in rural Alaska. Further market analysis will be conducted in the first year’s planning effort, including focusing on residential-serving distrib- uted solar and storage deployment, and the participation of low-income and disadvantaged households. While Alaska is data-poor, there are program models that have been used effectively and that experience is described below.FIGURE 1: Solar resource comparison of Alaska and Germany (NREL). 2 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Despite having a solar insolation value similar to Germany (Figure 1), Alaska has not fully embraced solar energy as a widespread source of power. With 19 MW of solar installed at the end of 2022, according to the Solar Energy Industries Association (SEIA), the state ranked 49th in total deployment capacity. The high-level results of a 2016 NREL analysis indicate there are plausible scenarios in which photovoltaic (PV) can be economically competitive with diesel fuel prices at low PV penetration levels. In this analysis, the cases where PV appears economically competitive generally requires a combination of (1) high diesel fuel prices (at least 40 cents/kWh), (2) relatively low, for Alaska, PV prices (approximately $6 to $9 per W installed), (3) relatively high, for Alaska, solar production levels (capacity factor of nearly 10% or higher), and (4) the ability to make use of economically valuable tax benefits provided by the federal government. Solar development is likely favorable for other Alaskan villages, not considered in this analysis, but have a similar combination of characteristics. Solar projects accounted for 2% of investment in Alaska in renewable energy between 2010 and 2020, including the state’s first utility-scale solar farms constructed in Healy and Willow. Solar generation in the spring and fall is often impressive in northern latitudes where clear skies, cool temperatures, dry air, and bright, reflective snow all support solar generation. Solar PV systems can exceed their rated output during these times of year. A good example is the Native Village of Hughes, a community of 85 people located on the Koyukuk river accessible only by boat or plane, which recently installed a 120 kW solar PV system to help advance the community’s renewable energy goal of 50% by 2025. In 2022, the Native Village of Hughes generated 500 MWh with diesel and 8.7 MWh through solar. The 8.7 MWh of solar power saved the community $21,353 in diesel costs. Alaska’s solar market is relatively immature compared to many other states. Alaska ranks 52nd out of the 56 States and Territories in both total Solar Jobs and Solar Jobs per Capita and 49th in installed solar capacity.1 In 2022, only 0.2% of the state’s electricity was from solar with an installed capacity of 19 MW. That’s enough to power 2,281 of Alaska’s approximately 329,285 housing units. Alaska’s solar installation rate has steadily increased over the years. Before 2018, the yearly installation was less than 1 MW. In both 2019 and 2020, it rose to over 4 MW, before the effects of COVID-19 shutdowns slowed the pace of installation. Per IREC’s Solar Job Census,2 Alaska FIGURE 2: Alaska Annual Solar Installations (https://www.seia.org/state-solar-policy/alaska-solar). 3 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE has 74 total solar jobs and 14 solar companies, with a growth projection over the next five years of 2.8%. Overall costs to install solar infrastructure decreased by 43% in the past decade. The chal- lenge of Alaska’s high latitude, resulting in extended periods of limited solar exposure during long, dark winters, presents challenges as well as opportunities for program implementation. 1. Market-wide historical deployment rates The Alaska Energy Authority has a strong understanding of the market for community solar, having funded through 15 rounds of its Renewable Energy Fund Program (REF). In its most recent round (16), six of 31 applications were for solar projects and totaled over $8 million. Through REF funding, multiple projects have proven the effectiveness of solar energy in rural Alaska. A good example is the hybrid solar + storage microgrid3 supporting the residents of Shungnak, a remote community above the Arctic Circle in Alaska. Funded by the United States Department of Agriculture (USDA) and Northwest Arctic Borough (NWAB), the microgrid addressed the numerous challenges of operating in extreme conditions and break the community’s dependence on its expensive diesel generator power plant. The microgrid’s 225-kW solar array can offset much of Shungnak’s energy needs, while battery systems each store excess energy for later use. Uniquely designed to enable a “diesels off” operation, the system automatically coordinates between solar and energy storage to ensure lowest cost power and communicates with the utility’s power plant about the best times to turn diesel genera- tion off. The microgrid is expected to save 25,000 gallons of fuel per year and an estimated $200,000 per year on fuel costs, based on $7 to $8 per gallon calculations. The Alaska Center for Energy and Power (ACEP) produced a map of installed solar in communi- ties across the state, tracked by its Solar Technologies Program4, which helps this project identify current locations to scale and a visualization of market need. 2. Participation of low-income and disadvantaged households and communities AHFC is an independent statewide agency working to provide access to safe, quality, affordable housing, which has achieved success in engaging and partnering with underserved and disad- vantaged communities across the state. Specifically, AHFC’s experience with its weatherization programs led to positive outcomes for these communities. AHFC, working with and through its Weatherization Assistance Program partners, increased the energy efficiency of 20,917 low income or disadvantaged homes between 2008 and 2018. This is when the program received a high amount of State funding due to high oil prices. • The average affected household experienced a 29% reduction in energy consumption. • 42% of participating households were outside of urban centers. • 38% of households were comprised of at least one Alaska Native member. FIGURE 3: Solar installation across Alaska (ACEP). 4 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE • 34% included an elderly member and 24% included a child younger than age six. • Median household income for participants was $28,263. Since 2018, with state and federal funding, AHFC’s weatherization program continued its work annually 200-300 benefiting low-income and disadvantaged households. Output and Outcome Targets Based on their experience in delivering projects in Alaska and past program deployment rates, AEA and AHFC have worked together to determine the following output and outcome targets for Community Solar and Residential Solar. The justification for achieving these targets is outlined under Underlying Methodologies, Data, Inputs and Assumptions. 1. The megawatts of solar capacity deployed over time (both as an absolute number of megawatts of solar deployed and dollars of award funding requested per megawatts of solar): • Residential: 10.38 MW | Community: 3.91 MW • Total: 14.29 MW deployed, $6,995,828 award funding requested per MW deployed. 2. Megawatt hours of storage capacity deployed over time (both as an absolute number of megawatt hours of storage deployed and dollars of award funding requested per megawatt hours of storage): • Residential: N/A | Community: 5.712 MWh • $17,507,003 per MWh storage deployed. 3. The number of households projected to benefit from the solar program (both as an absolute number of households and award funding requested per household); • Residential: 2,596 households | Community: 3,504 households • Total: 6,100 households, $16,393 funding per household. 4. Short tons of annual carbon dioxide (CO2) emissions avoided over time (both as an abso- lute number of tons of CO2 reduced and dollars of award funding requested per tons of CO2 reduced): • Residential CO2 avoided: 8,137 tons/yr, 244,102 tons over 30-year life. • Community CO2 avoided: 3,065 tons/yr, 91,956 tons over 30-year project life. • Total CO2 avoided: 11,202 tons/yr, $8,927 award funding per ton per year. – 336,060 tons avoided over 30-year life, $297 award funding per ton CO2 avoided. 5. Absolute amount of household savings realized over time (both as an absolute number of dollars saved and dollars of award funding requested per dollars of household savings). • Residential: 42%, $49,849,977 over 30 years. • Community: 39.8% $40,004,160 over 30 years. • Total: $1.11 of award funding per dollars household savings (over 30 years) 2. Meaningful Benefits Plan Delivering Meaningful Benefits The project team has utilized a variety of tools to thresholds of burden faced by project communities and households. CEJST and EPA’s EJScreen identify areas in Alaska that are overburdened or under- served, consistent with Solar for All guidance, which will direct Alaska’s program investments. This is generally consistent with where Power Cost Equalization (PCE) communities fall in AEA’s 10 rural energy regions (which are geographically dispersed), where high cost is relative to an average of three urban communities. Community solar will focus on eligible projects in rural communities that are considered disadvantaged or Tribal. Disadvantaged communities within the Railbelt will be eligible, 5 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE where residential solar might be a more viable option. AEA’s review of the CEJST produces a map of Alaska that indicates the majority of the State’s eligibility to qualify as disadvantaged. This is further enhanced by the White House Executive Order identifying all Tribal lands as disadvantaged, which applies to almost all of Alaska. The table below demonstrates for relevant census areas and boroughs (county equiva- lent), their FIPS identification for reference, population, Rural status according to the Office of Management and Budget (OMB), their Social Vulnerability Index (SVI) according to the Centers for Disease Control and Prevention (CDC), whether they are Areas of Persistent Poverty (APP) according MAP 1: CEJST Mapping Tool - Alaska Disadvantage City/Borough FIPS*Pop.Rural (OMB) National SVI* Ranking (CDC) APP* (DOT) DDA* (HUD) Distressed Communities Aleutians East Borough 2013 3,515 Yes Moderate to High No Yes No Aleutians West Census Area 2016 5,723 Yes Low to Moderate No Yes No Bethel Census Area 2050 18,216 Yes High Yes Yes Yes Bristol Bay Borough 2060 877 Yes Low to Moderate No No Yes Valdez- Cordova Census Area 2063 9,202 No Low to Moderate No No Yes Denali Borough 2068 2,059 Yes Low No Yes Yes Dillingham Census Area 2070 5,000 Yes High No Yes Yes Haines Borough 2100 2,474 Yes Low No No Yes Hoonah- Angoon Census Area 2105 2,151 Yes Low to Moderate No No Yes Ketchikan Gateway Borough 2130 13,918 Yes Moderate to High No Yes Yes Kodiak Island Borough 2150 13,345 Yes Moderate to High No Yes Yes Kusilvak Census Area 2158 8,049 Yes High Yes No Yes Lake and Peninsula Borough 2164 1,587 Yes High No No Yes Nome Census Area 2180 10,008 Yes High No Yes Yes North Slope Borough 2185 9,872 Yes Moderate to High No Yes Yes Northwest Arctic Borough 2188 7,671 Yes High No Yes Yes Wrangell- Petersburg Census Area 2195 5,910 Yes Moderate to High No Yes Yes Prince of Wales – Hyder Census Area 2198 6,422 Yes High No No Yes Sitka 2220 8,458 Yes Low to Moderate No No No Skagway 2230 1,240 Yes Low No Yes No Southeast Fairbanks Census Area 2240 6,918 Yes Moderate to High No Yes Yes Wrangell 2275 2,127 Yes Moderate to High No No Yes Yakutat 2282 662 Yes Moderate to High No Yes No Yukon- Koyukuk Census Area 2290 5,327 Yes High Yes No Yes 6 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE to United State Department of Transportation (USDOT), whether they are Difficult to Develop Areas (DDA) according to Department of Housing and Urban Development (HUD), and whether the Denali Commission considers communities within Distressed. AEA will conduct an equity assessment as part of project identification and as part of the award process. This will include reviewing available datasets to ensure distribution of project benefits to 40% disadvantaged communities and to structure the project for sponsors and contractors to imple- ment strategies that maximize equitable benefits. Rural Alaska faces some of the highest energy costs in the nation. Most of Alaska’s rural commu- nities are islanded microgrids and rely on diesel power generation. Program benefits will vary substantially across the state, contingent on several factors such as solar resource availability (determined by project’s geographic location), ease of site accessibility (whether the community is road-accessible or if materials need to be transported by air or barge), and the level of complexity associated with incorporating the system into the existing diesel microgrid. Given the geographically dispersed locations of Alaska’s rural communities, electric rates are frequently three to five times greater than those incurred by customers residing in urban areas of the state. AEA, along with the Regulatory Commission of Alaska (RCA), administers the Power Cost Equalization (PCE) program to provide economic assistance and reduce the effective electric rates for rural consumers to be comparable to in urban areas of the state. The PCE program serves 82,000 Alaskans in 193 communities that are largely reliant on diesel fuel for power generation, providing payments to households in high-cost energy communities to effectively lower residential energy costs, up to 750 kWh per month. Savings from residential solar in a PCE community would be applied to their PCE benefit and would have no impact on a homeowner’s effective utility bill, making residential solar more challenging in these communities. The project team recognizes constraints to solar implementation based on previous work in these communities, including that many houses in rural Alaska may not be suitable for rooftop solar. The necessary upgrades are prohibitively expensive and would quickly run up to the utility’s limit of 6% of nameplate capacity of the grid coming from solar generation. However, these constraints have been successfully managed for community solar and battery projects in rural Alaska. The model that has been successfully deployed in Alaska and is the planned model for the Community portion of this program is the community owned Independent Power Producer (IPP) model. This model aims to build a community owned Solar PV array with battery storage, operated by a commu- nity owned IPP. The community owned IPP will sell power to the local utility through a Power Purchase Agreement (PPA). Revenue from the sale of power from the utility will fund operations and maintenance (O&M) of the asset, and excess funds will be distributed back to the community as a diesel avoidance payment, equivalent to more than 20% of the average house- hold’s electric bill.FIGURE 4: 193 PCE Communities that AEA works with monthly 7 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE This community owned solar PV plus battery integrated into the existing microgrid model has been successfully implemented in Shungnak-Kobuk, which was a grand prize winner of the Sunny Award for equitable community solar. The community owned IPP model is the best method to increase access to the benefits of solar in rural Alaska and delivers on all five of the meaningful benefits targeted in Solar for All. • Benefit 1: Delivering a minimum 20% of household savings to program beneficiaries. – Residential Program: On the Railbelt, residential electric rates average $0.22/kWh. Under the assumed base case 4kW rooftop solar array, in this program, an average household can expect to save $640 annually, or 42% of annual electric bill. – Community Program: With the above described IPP model, preliminary estimates based on past projects indicate that households will receive diesel avoidance cost benefits equivalent to 40% of their effective electric bill. • Benefit 2: Increasing low-income and disadvantaged households’ access to solar through financing products and deployment options. – Residential Program: Solar deployment in Alaska has remained largely out of reach for low- income and disadvantaged communities. This program will have no match requirements for qualifying households, significantly lowering the barrier to entry. The program will aim to reduce the administrative burden as much as possible for these households through simple applications and net-metering permits handled by the installers similar to the approach AHFC took with its COVID-19 Emergency Rental Assistance and Homeowner Assistance Fund programs. – Community Program: The IPP deployment option allows disadvantaged communities in rural Alaska to realize the benefits of solar and battery storage. • Benefit 3: Increasing resiliency and grid benefits by creating capacity that can deliver power to low-income and disadvantaged households and/or critical facilities serving low-income and disadvantaged households during a grid outage. – Community Program: Many Rural Alaska communities rely on outdated infrastructure past its useful life and are subject to frequent power outages, especially during fall and winter storms. The importance of reliable energy in Rural Alaska cannot be overstated. Short outages can have drastic detrimental impacts to the well-being of a community. Water and sewer distribution systems can quickly freeze up in the winter months. If power generation isn’t quickly restored, residents can go the entire winter without access to clean water and working sewer system in their homes. Community-owned battery backup generation can greatly reduce the frequency and severity of these events. • Benefit 4: Facilitating ownership models that support low-income households and communities building equity in projects. – Community Program: The community IPP model has proven to work well in Alaska, and one of the critical aspects is that the solar array is community-owned. The power produced will be sold to the utility, and the revenue generated will be dispersed to the community and back into the project for O&M. Having the community own the asset allows residents to receive Power Cost Equalization (PCE) while still seeing a direct positive impact of havingsolar in the community. Alaska’s Solar for All program will score and evaluate proposals for commu- nity-based solar, and one of the criteria will be the use of local hire labor. Hiring local labor to build a community solar array encourages pride and ownership of the asset and develops a local workforce to have the skills to perform routine O&M tasks. This is particularly important in Rural Alaska. Flying a technician can be a prohibitively expensive and lengthy process. • Benefit 5: Investing in quality jobs and businesses fits under the Administration’s Good Jobs Principles and Executive Order 14082 (Implementation of the Energy and Infrastructure Provisions of the Inflation Reduction Act of 2022). The following Job 8 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Creation describes the project’s approach to this benefit for both the Residential and Community Program. Job Creation The project team is committed to fostering safe, healthy, and inclusive workplaces with equal opportunity, free from harassment and discrimination. AEA will provide multiple pathways for creating high-quality, middle-class jobs in the residential-serving distributed solar energy industry based on principles outlined below. In addition, the partners have considered ways to invest in training, education, and skill development and support the corresponding mobility of workers to advance in their careers. The project will assess collective bargaining agreements as identified throughout the life of the project. i. Wages, benefits, and other worker support provided - The project sponsors and partners approach to quality jobs means that project staff will have (1) fair, transparent, and equitable pay that exceeds the local average wage for an industry, while delivering; (2) basic benefits (e.g., paid leave, health insurance, retirement/savings plan); (3) providing workers with an environment in which to have a collective voice; and (4) helps the employee develop the skills and experiences necessary to advance along a career path. In addition, the partners will offer good jobs that provide (5) predictable schedules and a safe, healthy, and accessible workplace devoid of hostility and harassment. With good jobs, (6) employees are properly classified with the limited use of indepen- dent contractors and temporary workers. Workers have a (7) statutorily protected right to a free and fair choice to join a union under the National Labor Relations Act (NLRA). ii. Commitments to support workforce education and training - The partners will encourage project staff to participate in training programs and encourage contractors to offer paid time for employees to participate in skills training. This will include the provision of personalized, modularized, and flexible skill development opportunities, such as on-demand and self-directed virtual training. This will be included as part of the cohort support system established through the project. The project will identify and provide continuing education programs for employees to earn credentials and degrees relevant to their career pathways. AEA’s plan for job creation includes active partnership with public and private sector partners that will help implement the deployment of Alaska’s Solar for All program and is complemented by a robust workforce development program. AEA has identified multiple components, elaborated in later sections. High Quality Jobs and Shared Economic Opportunity AEA’s job creation plan is centered on delivering meaningful benefits to low-income and disadvan- taged communities, which these examples exemplify. AEA has decades of experience developing projects that increase shared economic opportunity and will apply that to its implementation of community and residential solar energy. An NREL study on distributed renewables for Arctic energy,5 found that community buy-in and ownership is essential. AEA knows that projects must be community-driven and supported, with community members understanding and participating in the value proposition of moving to a stronger reliance on renewable energy. It is critical to include and receive sanction from key stake- holders like utility managers, operators, project champions, and local government officials. Beyond project development, community engagement must be ongoing, and continue after the project is deployed to maintain community support and ownership. Long-term engagement is an essential element of sustainability. For example, a strong community focus enabled Galena, a city of 472 people in the Yukon-Koyukuk area, to hire and train an all-local workforce provided enhanced job satisfaction, increased local capacity, and strengthened the community overall. 9 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Multi-sectoral Partnerships AEA has a successful record partnering both as owner and project manager in community capital projects and in advancing State energy goals and priorities. AEA also has established relationships with tribal entities, local governments, and other State departments, with a focus on workforce, permitting, and community development. Early engagement with these stakeholders will help to ensure that the project is responsive to local energy plans and goals. AEA has assembled a strong list of partners that start with AHFC, which will deliver the program’s residential solar activities. AEA and AHFC will collaborate with academic, public and private sectors, labor, training centers, utility, and community-based organization partners to deliver job creation and workforce development. AEA and Alaska’s public and cooperative utilities are accustomed to engaging with local govern- ments and tribal entities through permitting and regulatory processes for rural energy projects. The applicable projects would establish milestones urging earlier dialogue with local governments and Tribal entities. These conversations should begin sufficiently early to inform project development in response to local communities’ needs and concerns. Local governments and Tribal entities are uniquely situated to help identify the most effective actions the projects can take toward partner- ships that advance workforce issues; diversity, equity, inclusion, and accessibility; and the flow of project benefits to disadvantaged communities. AEA and partner utilities have extensive experience engaging with residents and businesses in town halls and similar formats. AEA is planning to ensure that proposed systems should commensurate with the training, educa- tion, and availability of the local workforce. AEA knows using community-appropriate technology reduces system failures and the community’s dependence on long-term, expensive, external assistance. Local capacity will determine how simple or complex the system should be, and what assets it can include. Robust operations and maintenance plans must be considered from the start. Technical assistance must be provided to complete and maintain the systems. Communities have found that small, easy-to-maintain pilot systems with solar PV, batteries, and/or wind can be a good stepping-stone to larger, more complex systems with higher contributions of renewable energy. Community-based technical capacity may be increased over time through community education and expanded experience from operating power systems. Many communities have been successful in engaging local youth, with energy providers gaining traction by speaking through credible, community-based educators. In Kotzebue, a hub community of 3,102 residents, on the Northwest Coast of Alaska, installing small wind turbines (50-kW capacity through 3 turbines) provided the technical capacity for subsequent installations of much larger wind turbines (17 turbines totaling 915 kW capacity), batteries, and solar PV systems. In Galena, a focus on community education and training allowed the community to perform increasing portions of system maintenance locally, enabling to set its sights on future solar projects. AEA knows that having a regional or statewide pool of support resources increases the likelihood of success, which its cohort and technical assistance approach will support. Having a network of knowledgeable people actively engaged in operating projects, such as an energy cooperative, that can provide targeted or technical education, increases the likelihood of project success. This network allows communities to install systems that they may not be able to support on their own. Allowing a process for communities to access this network will streamline the renewable energy development process including planning, financing, installation, and operations. Such a network is especially helpful for small communities with limited human capital. A face-to-face knowledge sharing network would increase the number and success rate of community projects. 10 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE AEA will identify and support competent, practical project managers that are required to ensure the project’s success. The technical, financial, managerial, and community engagement components of a renewable energy project must be overseen by experienced personnel to help ensure effec- tive delivery of projects. Managers must be able to validate project proposals from engineers and external entities, compare those proposals to community needs, and decline when necessary. Some communities also face rapid turnover of bookkeeping and managerial staff, reducing their financial and managerial capacity for projects. Such seemingly minor problems can have long-term impacts. 3. Distributed Solar Market Strategy Adoption of solar PV in Alaska on a substantial scale faces multiple market barriers both common to the rest of the nation, and specific to the state. Barriers such as net metering, third party owner- ship (TPO), obscure interconnection processes, and renewable portfolio standards (RPSs) all exist here as they do across the country. Additionally, the substantial variance in seasonal generation and the astronomic cost of installation for remote communities pose geography specific problems. The prevailing net metering legislation established by the Regulatory Commission of Alaska (RCA) dictates that all utilities under their economic jurisdiction must provide net metering options to their customers, provided that the total nameplate capacity of all net metering participants does not exceed 1.5% of the previous year’s average retail demand. Utilities with annual retail power sales below 5,000 MWh or those generating electricity entirely from approved renewable sources are exempt from this requirement. Several leading utilities in the Railbelt region, notably Chugach Electric Association (CEA) and Golden Valley Electric Association (GVEA), offer net metering limits exceeding the RCA’s cap, extending up to 5% of average retail demand. Homer Electric Association (HEA) goes even further, allowing up to 7%. Meanwhile, Matanuska Electric Association (MEA) has not set a specific limit on net metered capacity but currently operates at approximately 3% of retail demand, with no recent refusal of new net metered capacity applications according to the latest RCA filing. Payment for net metering occurs monthly through bill credits, determined by each utility’s non-firm avoided cost rate registered quarterly with the RCA. These credits have no expiration date and can be applied to subsequent monthly bills. Individual net metered systems must have a nominal capacity between 400 W and 25 kW. Utilities are prohibited from imposing additional fees, such as standby, interconnection, or capacity charges, unless approved by the RCA. Utilities can limit net metering amount if it causes stability or operational issue. In case of a decrease in retail sales, resulting in the net metering amount exceeding the limit of 1.5%, utilities are not allowed to disconnect the metering of a member. The utilities can require net metering customers to have insurance with the condition that it is attainable and priced reasonably. The RCA has not instituted statewide mandates regarding the implementation of virtual net metering or other aggregative/alternative net metering policies. In 2019, the RCA rejected a utility-sponsored proposal for a community solar project, citing specific plan details regarding subscription policies. However, they expressed support for innovative renewable energy programs and emphasized that this decision did not set a precedent for community solar. CEA and GVEA have shown interest in revisiting community solar projects, addressing the issues raised in 2019. Various public interest groups are actively engaging with the legislature and drafting legislation to encourage and facilitate community solar initiatives. In Senate Bill 152, the state legislature codified the ability of the RCA to make rulings on community energy producers, strengthening the language that existed regarding small power producers. 11 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE No explicit rulings regarding third party ownership (TPO) have been made by the RCA. Insofar as small power production facilities are concerned (as would be the case for a community solar installation) the Alaska Administrative Code (AAC) utilizes the definitions for a qualifying facility laid out in 18 C.F.R. 292.101(b) and has protections and guarantees that they must be offered interconnection by the RCA regulated utilities. Specifically, for any electric utility subject to RCA regulation interconnection must be offered to a qualifying facility so long as it doesn’t cause the utility to become subject to federal regulation under the Federal Power Act (interstate operation) and so long as the qualifying facility complies with safety and reliability standards prescribed in 3 AAC 52.485. This regulation also provides for financing options with regard to interconnec- tion fees laid out in 3 AAC 50.760 d/e. The utility can charge interconnection fees, including: the reasonable cost of connection, switching, metering, transmission, distribution, safety provisions, administration, and other costs related to the installation and maintenance of the physical facilities necessary to permit interconnected operations, to the extent that these costs are in excess of the costs that the utility would have incurred if it had not engaged in interconnection. Additionally, the utility must offer the option to pay these fees over a reasonable period of time, with an interest rate described in their tariff or in a special contract between the qualifying facility and the utility with RCA approval. In sum, there are protections for third party ownership, at least of community scale renewable genera- tors. TPO, as it pertains to rooftop residential solar, would likely be considered individual net metered capacity, with the ownership of the panels and power a separate issue to be defined by those respec- tive parties and thus outside RCA’s purview. While the regulatory framework doesn’t provide explicit support for installations of either type, it at the least protects their right to connect and sell power to the grid. As demonstrated by the recent opening of the 8.5 MW solar farm in the Mat Su Borough by a third party, there is interest from the Railbelt utilities and general support from the RCA and legisla- tive framework to add renewable generators. Multiple successful implementations of rural solar IPP systems indicate their viability from regulatory and utility perspectives. Interconnection processes are not regulated on a statewide basis. Streamlining this is a signif- icant opportunity to reduce the barriers for residential rooftop applications. All four Railbelt Co-ops offer applications and supplementary information via their websites with varying degrees of complexity. CEA has a clause in their application allowing for combination of some required system drawings and streamlining of approval procedures for “type-tested” or previously approved and installed system designs, and implementation of similar language by the other Railbelt utilities will be sought by project partners. For the residential portion of the program, AHFC would provide a standardized system design for households and leverage said language to expedite the approval process and substantially enhance approval and installation rates. As it relates to the rural portion of the program, interconnection will be protected by the RCA rulings related to small power producing facilities. Grid stability is of significant concern in those scenarios, and early communi- cation and involvement with the local utilities will facilitate successful solar integration. While there is currently no binding statewide renewable portfolio standard (RPS) in Alaska, there is pending legislation looking at Renewable Portfolios Standards or Clean Energy Standards for Alaska. These bills propose renewable generation targets of 25% by 2027, 55% by 2035, and 80% by 2040 for Railbelt utilities, which currently operate at approximately 15% renewable generation. The state’s overall renewable portfolio is bolstered to around 25% by various small-scale hydro- power projects in southeast Alaska. Notably, any net metered capacity is presently included in the utilities’ generation statistics, potentially incentivizing utility collaboration and investment in distributed solar projects. 12 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Furthermore, the results of an NREL study, initially commissioned by Alaska Governor Mike Dunleavy, examined five scenarios to achieve 80% renewable generation by 2040. The study found that nearly all of these approaches would yield substantial savings compared to continuing the use of natural gas as a primary fuel source. The depleting gas reserves in the Cook Inlet have prompted major utilities to explore alternative fuel sources, leading to several ongoing utility-scale wind and solar feasibility studies. Addressing the substantial geographic and jurisdic- tional diversity across our impacted regions could pose some barriers for program efficacy. The respective experience of the coalition applicants, working collab- oratively with multiple entities across the state, ranging from tribal coun- cils, village governments, municipalities, non-profit organizations, and more will prove invaluable in this endeavor. The splitting of rural community and residential Railbelt funds is indicative that the partners are aware of the need to provide aid in different ways to address the individual circumstances in different parts of the state. AEA’s outreach partners will be made up of a variety of groups chosen to maximize their interaction with disadvantaged communities across the state. As is predictable in sub-arctic to arctic environments, the seasonal variation in solar genera- tion poses a substantial barrier to its economic viability. The conditions during the springtime with cold temperatures, long daylight hours, and light snow cover lend themselves even to the point of surpassing nameplate production for the panels. Conversely the shorter days of winter and substantial snow cover during late fall drastically limit solar energy production. The Alaska Center for Energy and Power (ACEP), in conjunction with some of the national laboratories, has performed pilot studies attempting to limit some of this variance on a daily interval and season- ally by combining multiple panel orientations to optimize average production. Leveraging their research to inform system design for the rural portions of the program could dramatically improve system performance. Based on research at the University of Alaska Fairbanks and industry consultation, the cost of a rooftop residential solar installation can fall anywhere between $10,000 and $30,000.6 Installations in urban Alaska typically range from $1.25 to $3.50 per watt, while remote installations range from $2.20 to $4.60 per watt, according to a 2019 report from ACEP. The cost of installing solar is typi- cally more expensive in rural Alaska due to the high transportation and labor costs. FIGURE 5: Household electricity consumption and the production from the 4 kW rooftop solar PV system. The solar system produced more energy than the home consumed from April through September. Note that the solar system was installed at the end of March. 13 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE 4. Financial Assistance Strategy Providing Eligible Financial Assistance Alaska’s program is designed to enable low-income and disadvantaged communities to deploy and benefit from solar, storage, and enabling upgrades, while ensuring all projects deliver house- hold savings, among other benefits. 84.8% of program funds will be used for financial assistance. AEA’s community solar program will be deployed as subgrants to eligible and successful project applicants. AEA anticipates 16 awards benefiting 3,504 households over the performance period, based on available funds. AHFC’s residential solar program may utilize a wider variety of tools, though envisioned currently as subgrants to partner organizations that can deliver programmatic benefits. AHFC anticipates serving 2,596 households through individual residential rooftop solar arrays and multi-family projects, as well as $3.5 million set aside for enabling roof upgrades for qualifying homes. Additional financial assistance mechanisms will be identified during the planning period, including the opportunity to leverage private equity, loan programs, incentive payments, and rebates. 84.8% of program funds will be used for financial assistance. Financial Assistance Model Residential Solar: AHFC will make available $40 million for a statewide residential solar program that targets disadvantaged, low-income households where net metering applies. AHFC may model its financial assistance off its Weatherization Assistance Program, which has successfully deployed funds to low-income households. AHFC’s financial assistance will provide subgrants to eligible recipients, including local solar programs, and incentive payments or subsidies as determined by the project team. Community Solar: AEA will make available $41.3 million for a rural solar project program focusing on disadvantaged communities where modeling shows high potential for both the resource and ability for microgrid integration. AEA will model its financial assistance off its Renewable Energy Fund program, that has successfully awarded 17 rounds of grants to commu- nities statewide. This financial assistance will be structured as grants to eligible community-level project sponsors, including local and Tribal governments, and utilities. Grants applications will not require a local match requirement; however, AEA will score projects that include a match more favorably and will communicate these criteria to all stakeholders. This approach aims to optimize the utilization of the Solar for All funding without creating barriers to entry for program applicants. Solar Project Financial Assistance This project will provide financial assistance through two platforms, with the goal of evenly distributing funds between the two. • Rooftop Residential Solar – AHFC will deliver the rooftop residential program, based on its experience working directly with low-income and disadvantaged households. • Residential-Serving Community Solar – AEA will deliver community solar projects, based on its experience managing the Renewable Energy Fund and delivering projects across rural, disadvantaged communities. AHFC has initiated discussions with non-profit investment funds that are interested in bringing energy financing solutions to Alaska. These discussions will be finalized during the planning period, to the extent that additional partners can be included in program implementation. 14 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE There is currently legislation (SB125 and HB154) proposed to create a state Green Bank, which may be housed at AHFC. Depending on if this legislation passes, AHFC will determine how to proceed with its Solar Financing Program. If a State Green Bank is created, AHFC would partner with that entity to operate the financing program either in-house or in partnership with national or regional non-profit green financing companies. If the Green Bank is not created during the 2024 legislative session, prior to EPA award of this program, AHFC will use the planning period to design a program and either partner with or sub-grant a regional or national non-profit to bring low-cost loans and financing tools to low to moderate income households in Alaska. These households are outside the income parameters of the fully subsidized low-income and disadvantaged Rooftop Solar program but would struggle to access the benefits of Solar through traditional financing means. Storage Project Financial Assistance AEA will determine utility-level investments in storage that facilitate community solar or increase the potential for success of rooftop residential. AEA expects that all community solar project appli- cations will include storage components and project funds will be used to ensure adequate storage occurs relative to demand. AEA and ACEP technical experts will evaluate storage considerations for appropriate financial assistance on a project-by-project basis. Complementing Existing Financial Assistance AEA and AHFC manage many programs that provide existing but limited financial assistance, which this program will complement. AEA is not aware of any duplication of financial assistance, though its REF has financed community solar projects in the past. The REF will complement Alaska’s Solar for All program by further advancing clean energy and storage options for disadvan- taged communities in Alaska. If awarded, AEA would seek to strategically leverage funds provided under its Grid Resilience and Innovation Partnerships (GRIP) Program application for innovative rural microgrids devel- opment funded via the Infrastructure Investment and Jobs Act (IIJA) in conjunction with funds sub-awarded under its Solar for All (SFA) Residential-Serving Community Solar competitive project solicitation. A community selected under AEA’s GRIP project solicitation would also apply for and be awarded funding under AEA’s Solar for All project solicitation, further capitalizing on federal funding programs. For example, if a project selected and funded under SFA would assist in funding the solar energy element of a particular innovative microgrid development under GRIP, those GRIP funds (which would have been otherwise allocated for solar portion of the project) would be re-allocated and expended on other aspects of the microgrid development, enhancing the overall impact of the GRIP funds. With its federal partners, AEA would seek to leverage the impact of SFA award funds with programs, such as, the High Energy Cost Grant program as administered by the Denali Commission. These grants provide funding assistance for energy generation, transmission, and distribution initiatives. AEA notes that further cost-matching opportunities for the leveraging of those monies awarded under its SFA program, if awarded, and which may be acceptable, or finan- cially feasible for such low-income and disadvantaged communities, include but are not limited to the Powering Affordable Clean Energy (PACE) Loan Program and the Rural Energy Savings Program both administered by the U.S. Department of Agriculture (USDA). Additionally, in collaboration with its SFA coalition members partners, and subject to those eligi- bility requirements as set forth in the Internal Revenue Code (IRC), AEA would encourage SFA applicants to take full advantage of those “elective pay” investment, or production tax credits as 15 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE established via the Inflation Reduction Act (see §45(Y) and §48(E) of the IRC). It is anticipated that applicants applying for AEA’s SFA Residential-Serving Community Solar competitive appli- cation would be eligible for, in part owing to the low-income and disadvantaged requirements of the SFA program and also owing to the demographic and economic composition of the state of Alaska, those additional “bonus” tax credit provisions (see §48(e) and §48(h) of the IRC), including the Prevailing Wage and Apprenticeship Requirements, Domestic Content, Energy Communities, and Low-Income Communities as set forth in the IRC, established within the IRA. C-PACER programs finance clean energy retrofits through property tax increases. If done by a third-party financier in conjunction with a municipality, they offer no-upfront cost, low-interest solar project financing. Adopted as Alaska state law in 2017, C-PACER will likely become avail- able sometime in the next year after municipalities set up the administrative structures needed to implement and operate the program. The Municipality of Anchorage is currently the only munici- pality with a C-PACER program. AHFC can build from and leverage many of its programs, including hallmark successes, such as implementing its $242.6 million Home Energy Rebate program from 2008-2018 reporting 26,587 homes improved with an average energy reduction of 34%. Most recently AHFC has been recog- nized for the Alaska Housing Homeowner Assistance program, helping over 12,000 Alaskans with utility, mortgage, and rent relief. AHFC is in the final year of a project funded by the DOE Advanced Building Construction Initiative workforce development funding focused on education and technical assistance for building monitoring. AHFC administers a bundled grant program it calls Greater Opportunities for Affordable Living (GOAL) to encourage housing development for lower-income persons and families, including seniors, by combining Low-Income Housing Tax Credits (LIHTCs); federal Home Investment Partnership Program (HOME) funds, National Housing Trust Fund (NHTF); and state funds through the Senior Citizens Development Fund (SCHDF) into a single application and funding process. AHFC would utilize the established and successful GOAL program to administer the $10 million Solar for All Funds to install solar to low-income multifamily developments and rehabili- tation projects that ensure benefits of 20% energy savings are achieved and passed to low-income and disadvantaged residents. AHFC will work with its network of Weatherization Assistance Program providers to identify candidates for a subsidized residential rooftop solar install with electrification upgrades through Department of Energy’s rebate program and a rooftop solar installation under this program. This would maximize benefits to our low-income residents while reducing administration and over- head costs. AHFC will be administering the Department of Energy’s two Home Energy Rebate programs, including the Electrification and Appliance rebate program that includes point of sale rebates for electrification improvements to help households prepare for a successful solar installation. The program includes up to $4,000 for a load center/service panel upgrade and up to $2,500 for house- hold wiring upgrades. AHFC works with an established network of professional energy raters and building inspectors to administer its Home Energy Rating System and its Building Energy Efficiency Standards on any home financed by AHFC (such as those through its tax-exempt first time homebuyer and veterans loans for income-qualified households). AHFC anticipates being able to leverage its weatherization program such that solar installation could occur alongside broader residential improvements. 16 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE The Alaska Department of Transportation and Public Facilities (DOT&PF) has developed a Carbon Reduction Strategy (CRS) to establish efforts to reduce transportation carbon dioxide (CO2) emissions and identify projects and strategies to reduce emissions within Alaska. DOT&PF has identified its airport rights-of-way as potential sites for community solar projects and will work to further develop the concept of deployment on these ideal locations. DOT&PF planning efforts to date include developing a carbon reduction strategy, updating that strategy every four years, supporting projects that decrease emissions, quantifying emissions, and ensuring equitable implementation. The Alaska Municipal League (AML) is the project manager delivering Alaska Department of Environmental Conservation (DEC) implementation of EPA’s Carbon Pollution Reduction Program, a $3 million planning effort that will result in a greenhouse gas inventory and a climate action plan for community carbon reduction projects, including solar installation. AML will provide pathways for Solar for All activities to be part of the state’s Climate Action Plan. 5. Project-Deployment Technical Assistance Strategy Technical Assistance and Development of Project Pipeline Between 2008 and 2023 the state legislature appropriated $317 million for Renewable Energy Fund (REF) grants, which AEA has managed. Those state monies leveraged over $250 million in private and federal funds to complete project funding. The REF is managed by AEA in coordina- tion with a nine-member REF Advisory Committee. The program provides grant funding for the development of qualifying and competitively selected renewable energy projects. Since its incep- tion 289 REF grants have been awarded and funded via legislative appropriations totaling $317 million. These funds have been matched by local and private contributions that have leveraged AEA’s investment. 103 operating projects have been built with REF contributions, collectively saving more than 85 million gallons of diesel and 2.2 million cubic feet of natural gas since the REF’s inception. These investments have resulted in the reduction of 1,110,424 gross metric tons of carbon dioxide since 2008. AEA has identified nearly a dozen projects that have the engineering and planning already in place to move quickly into construction, if funded. AEA is an active partic- ipant in many of the projects, including as project manager. The completed studies have shown that many of the projects are viable and ready for implementation. Disadvantaged communities will directly and indirectly benefit from the outcomes of the project activities. By inclusive engagement in project development, scoping, and implementation, disadvantaged communities will be exposed to learning opportunities that will enable them to improve current practices and policies. Upon completion, the projects will provide public health and safety benefits to communities. One of the hallmarks of Alaska’s community solar program will be the high level of technical assistance provided to project sponsors. • A cohort approach – Each year’s project awardees will participate in an ever-expanding cohort, which will feature the addition of project awardees in the following years. Awardees will participate in quarterly web-based sessions that provide resources and trainings on project and grant management, asset management, maintenance and operations, and gover- nance and financial sustainability. • Technical assistance – Potential applicants, or applicants whose applications aren’t accepted in an award cycle, will be provided with additional levels of support by project partners. AML will provide project development and application support to strengthen capacity for applications to be more successful, not just through this program but for other federal opportunities. 17 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE • Leveraging financial opportunities – Funded projects will be evaluated by a team at AEA and in collaboration with project partners, such as ACEP, to determine feasibility of leveraging private capital, or other funding sources, to maximize the available federal funding and to increase the overall local contribution. This process will also identify ways in which rates will have to be structured for future maintenance and operations. AHFC will convene a solar market stakeholder group that will include developers, contrac- tors, and housing authorities to develop a technical assistance strategy for Alaska’s residential solar project pipeline. This emerging market opportunity corresponds to the need for technical assistance, which can best be developed and delivered by active participants and owners. This stakeholder group discussion will feature technical assistance to solar developers to address interconnection challenges. Technical Assistance that Leads to Workforce Development and Project Deployment Alaska’s utilities are experienced operators of power systems that experience challenging condi- tions. The local and regional workforce is skilled, and regularly provides training opportunities. In partnership with the Alaska Vocational and Technical school (AVTEC), AEA offers the Power Plant Operator training program that includes engine maintenance, troubleshooting and theory, electrical systems and generators, introduction to electrical distribution systems, diesel electric set operation, control panels, paralleling generator sets, load management, fuel management, waste heat recovery, plant management, and power plant safety. As part of this program, AEA will update course curriculum to be responsive to new and innovative solar system designs, and work with partners to deliver the course for participants. At the same time, AEA’s Circuit Rider Program7 provides eligible utilities with technical assis- tance to improve the efficiency, safety, and reliability of their energy infrastructure. Circuit Riders provide skilled labor to address, diagnose, and repair rural powerhouses, including to provide training for local communities to create skilled power plant labor. This program helps to reduce the risk and severity of emergency conditions. The Circuit Rider program develops strong ties with the remote Alaskan communities. The power system operator ecosystem in Alaska is interdependent, with strong collaboration between the state and utilities in ensuring system operability and commu- nity health and safety. As part of its Solar for All program, AEA will ensure that the Circuit Riders have the tools and training to increase support for community and residential solar and continues to support and train local communities in the use of improved power systems. Partners anticipate that there will be opportunities for workforce or community strategies to be established as a direct result of the project. AML will be responsible through its stakeholder engagement role to work with community leaders to identify ways in which the project benefits can best accrue to the community, including through siting and permitting best practices. AML’s experience working to strengthen local governments will be useful in engaging communities and solar developers in technical assistance that addresses land use, building codes, and inspec- tion and quality control. This will include planning for environmental justice, carbon reduction, workforce development, shared procurement, local hire, and asset management, including maintenance and operations planning and technical assistance. AML will reference DOE’s Community Benefit Agreement Toolkit,8 recognizing that it doesn’t apply the same to federal projects as private, its intended purpose. The outcome of the CBA will be 40% of benefits should be allocated to communities of color, Indigenous peoples, low-income communities, and other marginalized groups. Each project will also evaluate the opportunity for workforce agreements, 18 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE which will help ensure equity for women, people of color, and other historically disadvantaged or underrepresented groups during the project’s implementation. Project sponsors will work through a facilitated community stakeholder process to identify ways in which workforce goals will be met. Goals include local hire, family-supporting jobs (wage parity), health insurance, diverse workforce, diverse workforce participation, and resources for continuing education and certification that result in a highly skilled workforce. Contractor solicitation should reference these goals as part of criteria for an award. Avoiding Duplication of Technical Assistance ACEP has one of the most robust solar technical assistance programs in the state, through its Solar Technologies Program. This program works to support responsible and equitable devel- opment of solar PV technology in Alaska and other cold regions and high latitude areas where it is technically and economically warranted. ACEP is leading the state in understanding of the Alaska solar resource, identifying new technologies and novel configurations that can improve energy outputs and ease integration concerns, and improving Alaska’s understanding of the cost, performance, and durability of existing systems along with common failure modes. This project will avoid duplication by working closely with ACEP and including them as a subrecipient as part of the coalition, to provide technical assistance. AML is supporting DEC’s Carbon Pollution Reduction Program, funded by the EPA, which will result in a statewide greenhouse gas emissions inventory and climate action plan. Solar projects will feature in the State’s climate action plan and AEA will coordinate with AML the inclusion of potential and funded projects. National level programs like the Clean Communities Investment Accelerator and National Clean Investment Fund, or Thriving Communities Technical Assistance Centers, are often lacking Alaska-related expertise or relationships. The project partners will maintain a line of communication to these providers, ensuring they are able to provide some level of benefit to Alaska’s disadvantaged communities; however, Alaska’s circumstances warrant local knowledge and experience be applied. ACEP is the leading provider in-state, which will enhance the program’s deployment. Workforce Development Plan AML will maintain a local workforce availability and hire tracking system throughout the life of the project, enabling meet local hire goals and cross-promoting hire between projects that might occur within a region. This system will also track municipal and tribal workforce in-kind contribu- tions, staff time that is applied to the project planning and implementation. The project team will conduct outreach during the planning period to the University of Alaska (UA), AVTEC, and Alaska Works Partnership (AWP) to identify ways in which training, appren- ticeships, and local hiring can benefit from solar integration into microgrids. In addition, the project will reference the Alaska Workforce Investment Board’s strategies for workforce develop- ment, found in its Combined Plan for Workforce Innovation and Opportunity.9 The UA is an important mechanism for workforce development, including apprenticeships. Twenty years ago, the University of Alaska Anchorage (UAA) created the Associate of Applied Science in Apprenticeship Technologies. The University of Alaska System, the UAA Community and Technical College, and several joint apprenticeship training programs have joined the United States Department of Labor (USDOL) Registered Apprenticeship-College Consortium, which simplifies the process for an apprentice to earn college credit. AEA will identify opportunities for collab- oration with UA on solar-specific or solar-adjacent courses and certifications that will advance workforce development goals. 19 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE AWP is a non-profit organization that provides Alaskans access to jobs and careers in the construc- tion industry. AWP educates Alaskans about good paying jobs, teaches basic skills, and establishes pathways for Alaskans to learn skills that last a lifetime and earn good pay with health care and retirement benefits. AWP partners with industry employers, community organizations, educators, and the State of Alaska to develop Alaska’s workforce. Several thousand Alaskans living in over 140 communities have gotten a start in construction through one of their programs. Training Plans Lead to High-Quality Careers Based on projections by the Alaska DOL&WD, from 2020 to 2030 there will be about 1,600 vacancies per year for positions that require postsecondary training or education. The 2022 excess unfilled job vacancies included approximately 3,000 positions for which employers typically require or prefer postsecondary education. Alaska lags U.S. averages, however, ranking 46th in October’s seasonally adjusted unemployment rate10 and 47th in job growth in 2022 through October.11 In 2021 and 2022 the Alaska job opening rate increased, ranging between about 8 and 14% (seasonally adjusted) (Figure 7). The highest rates correspond to a ratio of only 0.4% unem- ployed person per job opening. The job opening rates are the highest since the survey began in 2012 and higher and more variable than those for the national 6.5% annual average.12 Both national and state numbers show job openings are much higher than before the pandemic. Three factors have been cited to explain this worker shortage: retirements and early retirements of the large “Baby Boom” cohort; diffi- culty in obtaining childcare; and in Alaska, outmigration of working-age adults. In September-October 2022, Alaska labor force participation rate was 65.6% and the labor force was 62.7% of the popu- lation, the highest values since 2017 and 2015, respectively (Figure 5). Both slightly exceeded the 2019 percentages. In the last 50 years the peak labor force participation was 75.3% and the peak labor force percentage of the population was 69.8%, both in 1989, and there has been a slow, steady decline since then. This is attributable to an aging population.13 Alaska’s participation rate is unlikely to improve further without additional resources and support. The following describes potential careers for clean energy, including many careers that do not currently exist or marginally so in Alaska: environmental technician, wind turbine technician, planner, solar installer, air quality engineer, energy manager, utility operator, energy engineer, health and safety officer, siting assessment and permitting, feedstock development, wholesale market administration, contract management, lifecycle analyst, asset management, distribution grid developer, economist, appliance distributor, financing, contracting, and procurement. Alaska’s Solar for All program will focus on the applicability of these careers to solar, specifically, but also look to leverage the interconnections across the clean energy industry. This recognizes the FIGURE 6: The job opening rate is the number of unfilled positions, for which em- ployees are being sought, divided by the total number of filled and unfilled positions. 20 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE interoperability necessary, especially for community solar, and the reskilling that may occur over the course of the program and upon conclusion. This project envisions a workforce ladder, utilizing intermediary training providers like AWP, apprenticeships facilitated by Alaska’s labor organizations, and the university to deliver medium and high wage occupation opportunities to disadvantaged communities. Unemployed and under- employed residents will work through an intake and navigation process to ensure appropriate engagement in tracks and guidance, including support services. There is widespread support for expanding apprenticeship in Alaska, particularly due to federal support through previous USDOL apprenticeship expansion grants and progress made since the 2015 American Apprenticeship Initiative and continues today with two active State Apprentice Expansion grants. All partners will be involved in the ladder through a collaborative process. Trades Track – As a coalition partner, AWP will offer pre-employment and pre-apprenticeship training through the existing Alaska Construction Academies, Women in the Trades, and Helmets to Hardhats programs. ASA will offer pre-employment and occupational certificate training required for work on solar energy projects. Residential training centers, school districts, and apprentice sponsors will be activated to join in project activities and engage in cross-industry employment and training activities. In the past 5 years, AWP has served >3,500 individuals, and 75% of those served were placed in industry jobs. Of these, > 700 entered registered apprentice- ship. AWP specializes in helping underserved and underrepresented populations enter and retain employment in industry jobs that pay above prevailing wages. AWP has established relationships with industry associations, employers, unions, apprentice sponsors, Alaska Native Organizations, educational institutions, and workforce agencies, and manages $3 million in federal, state, and local workforce grants. University Track - AEA will work during the first year’s planning process to work with the University of Alaska system, which has the potential to help meet workforce needs for solar energy by expanding key certificate programs and increasing industry access to trained workers. UA is not considered a named subrecipient within the program coalition. UA could expand the number of relevant certificates offered as well as promotes the engineering degree programs that serve the solar sector. AEA will engage with UA during the program planning year to assess and identify current occupational needs, organize career fairs, and assess the impacts of existing workforce training. AEA can communicate to UA industry needs and opportunities in the engineering and technology sectors and help connect industry partners with students, faculty, and staff. UA may consider supporting job placement, internships, job shadow opportunities for students, career fairs, mentorship opportuni- ties, interviewing/resume/skills workshops, and industry interaction with student clubs. AEA will encourage UA to assess current UA efforts and partnerships to evaluate the extent that current training programs are effectively meeting the needs of industry and make recommendations to strategically invest program funding to increase capacity, graduates, and the number of graduates becoming employed in these targeted sectors. UA will contribute to the project’s information campaigns - data presented in the University of Alaska Workforce Reports shows that new graduates earn good salaries in most fields and their earnings increase substantially over five years following graduation.14 The university will consider continued expansion of online programs, informed by discussions with partners during the planning period, with a focus on adding more of the most needed workforce programs. If hands-on instruction is needed, it will be provided with intensive face-to-face components or, in some cases, internships or other on-the-job training, including through AWP. Dual enrollment opportunities are especially important for first-generation and economically disadvantaged students to increase their college graduation rates substantially.15,16,17 21 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Workforce Training that Targets Low-Income and Disadvantaged Communities The project partners understand the complexities of the labor market and will focus efforts on communities with higher unemployment or underemployment rates, key indicators of low-income and disadvantaged populations, and which are underrepresented in key occupations. Low-income populations often face higher rates of unemployment due to limited access to education, skills, and job opportunities. Economic downturns and recessions can disproportionately affect these groups as they may work in industries that are more vulnerable to economic fluctuations, such as low-wage service sectors. Low-income individuals are often concentrated in areas with limited job opportunities, which can contribute to higher unemployment rates within these communities. Limited transportation options can further restrict access to employment centers. Alaska’s unemployment rate is at a historic18 low, averaging 4.8% in 2022 (January to October, data not seasonally adjusted), with the rate even lower in urban areas (3.6% in the Municipality of Anchorage and 3.8% in the Fairbanks North Star Borough). However, unemployment remains high in most rural areas, for example, 10.7% in the Bethel Census Area and 8.6% in the Nome Census Area (average of January to October 2022, not seasonally adjusted) (Figure 6). Alaskans’ educational attainment is less than the national average, with a smaller proportion of the popula- tion holding baccalaureate and graduate degrees and a higher proportion with some college but no degree (Table 1).19,20 Only 35% of Alaska’s 2020 high school graduates enrolled in postsecondary education within 12 months of graduating. From 2000 to 2014, the percentage was significantly greater, 44 to 46%, but after 2014 declined steadily. The percentage of postsecondary enrollment of Alaska high school graduates is very low; the national average is 76% enrolling immediately after high school. In-state college enrollment is also low in Alaska, 52% vs. a national average of 80% in fall 2020. The Alaska percentage peaked at 71% in FY 2015 but has declined since.22 Alaska’s high school graduates peaked in 2019 at 8,590 then decreased by about 13% in 2020 and 2021. The project team will go through a process of strategic workforce planning that includes an understanding of demographic changes, cost reductions, talent management, and flexibility. The project is responsive to current conditions, where a qualified workforce is critical for project FIGURE 7: Although the unemployment rate is at historic lows in urban areas, it remains high in much of rural Alaska. 22 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE delivery, but the availability of skilled workers has been reduced. AEA and partners will work with project proponents to design workforce strategies that limit vacancies and overstaffing, ensure critical competencies, include cost efficiency that is manageable, and maintain a work- force that is agile, resilient, and flexible. AHFC has experience in delivering training through its Jumpstart program, which helps with job readiness, among others. The project partners have decades of experience working with low-income and disadvantaged communities, including through their education and training partners. Employer partners, including utilities, reflect the needs and equity goals of Alaska communities. AEA and AHFC will work closely with the Railbelt utilities and with rural microgrid utilities to create efficiencies for program deployment. A utility working group will be convened during the planning period to ensure close cooperation throughout the program, including annual dialogue to review implementation chal- lenges or opportunities. Partners engage with Alaska’s communities and help them to identify and secure resources for their highest priority needs. In addition to addressing community needs for training and education, the partners have the potential to link to statewide community outreach and engagement through Cooperative Extension and the Alaska Small Business Development Center, among others. 6. Equitable Access and Meaningful Involvement Plan Customer Acquisition Strategy AEA and AHFC have long-standing access to and communication with disadvantaged commu- nities across the state, spanning both rural and urban areas. AEA regularly manages recurring annual solicitations for project applications to its Renewable Energy Fund, which has funded nearly 300 awards in support of multi-phased development of clean energy projects, from microgrids to utility scale development, with nearly 70% of projects to date having been awarded to tribal or tribe-serving entities. AEA would seek to leverage its relationships with a statewide network who provide support and advocacy for their respective members including AML, representing 165 cities and municipalities and local governments, the Alaska Power Association (APA) representing rural and urban utilities alike, and regional development organizations such as the Southeast Conference (SEC), which seeks to champion the needs of the majority of southeast Alaskan communities. AEA has the opportunity to work closely with the Alaska Native Tribal Health Consortium (ANTHC) and regional Tribal health nonprofits such as the Tanana Chiefs Conference (TCC) to reach Tribal governments and stakeholders. Marketing of this program would also be conducted internally by AEA staff for dissemination to the public via AEA’s website, AEA social media accounts, public notice boards, and other media. As part of its marketing strategy, AEA would focus its efforts on outreach focused on those disadvantaged communities, in recognition that support for these communities is both a requirement and central tenet to the SFA program. TABLE 1. Educational attainment of Alaskans compared with U.S. average.21 Less than 9th grade Grades 9 to 12, no degree High school diploma Some college no degree Associate degree BA degree Graduate degree Age 25 years and over, AK 2.4%4.5%28.4%26.0%8.7%18.7%11.3% Age 25 years and over, US 4.8%5.9%26.3%19.3%8.8%21.2%13.8% 23 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE At the same time, AHFC has a variety of program experience that has established its meth- odology for customer acquisition. AHFC developed and administered the U.S. Treasury’s COVID-19 Emergency Rental Assistance and Homeowner Assistance Fund Programs whereby AHFC provided the critical infrastructure for all Alaskans to check their eligibility apply through a single portal. The process pooled resources from Anchorage, Alaska’s largest city, and tribal entities resulting in an efficient application process for Alaskans and allowed AHFC and its partners to quickly evaluate applications and issue payments. This effort led to a national award in 2022 for management innovation by National Council of State Housing Agencies, and first place communications awards in the categories of community relations and special elec- tronic and printed promotional materials by Alaska’s Public Relations Society of America. AHFC received a 2022 Sterling Achievement Award for Homelessness by the Council of State Community Development Agencies for its Alaska Housing Rent Relief program. This program distributed more than $262 million in rent relief funds across the state and was one of only a handful of states to provide rent relief to all eligible applicants, meeting distribution thresholds set by U.S. Treasury. AHFC reallocated remaining funds to its innovative Housing Stabilization and Recovery effort, working with 22 nonprofit partners in 20 key communities across the state to enroll over 2,600 households into the program, utilizing extensive street outreach, shelter visits and referrals from nonprofit organizations has helped to move clients through the stabili- zation effort. Both AEA and AHFC have long-standing connections to disadvantaged communities, and the state’s Solar for All program will benefit from this experience, even as it brings in new partners to augment and further its goals of reaching low-income and disadvantaged households. The program partners will utilize existing and extensive working relationships with Alaska’s 14 Regional Housing Authorities to build awareness in their communities and gather participants in regions where eligibility and competitiveness align. FIGURE 8: https://www.ahfc.us/newsroom/alaska-housing-rent-relief-weekly-program-update 24 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE While demand in Alaska is much greater than available resources, including through Solar for All, the partners understand that it isn’t possible to reach all households across the state alone, and that delivering outreach and program information to intended beneficiaries will require partners who can help with customer outreach and acquisition. Due to Alaska’s challenges, limited install capacity and the smaller scope of its proposed Solar for All than other states, the outreach and customer acquisition will need to be targeted to ensure participation is equitable with the Justice 40 and CEJST principles. For residential solar, AHFC will engage and provide funding to non-profit “Solarize” campaigns in specific CEJST identified disadvantaged communities to provide homeowner education and participant aggregation. Alaska has had several successful Solarize campaigns performed by local non-profits at the neighborhood level that leveraged communal action and coordination to bring down install prices. AHFC will utilize that knowledge and passion to ensure participation from urban CEJST communities. AHFC will work with its Weatherization Assistance Program partners that provide services to low-income households throughout the state to identify quality candidates. Weatherization partners are already admitting participants, income qualifying them, and improving houses across the state. AHFC wants to leverage that on the ground and work to identify households that are good candi- dates and enter them in the programs. Educating and Engaging Communities on Solar Energy Benefits AEA and partners have delivered clean energy education to Alaskans for decades, and regularly provide resources to stakeholders that includes the benefits of state programs. Most recently, the Governor has initiated and hosted Alaska’s Sustainable Energy Conference, a rapidly growing opportunity to provide education, outreach, and community engagement. AEA conducts outreach to PCE communities throughout the year, and its Circuit Rider program delivers direct support and engagement. At the same time, AHFC has demonstrated an effective strategy for community education and engagement through its recent rent relief program, where it reached 26,000 house- holds and distributed $262 million, as depicted in Figure 9. AHFC’s video series on its rent relief program was highly successful, and tools such as this can be employed to advance community education and engagement. Culturally Appropriate and Responsive Outreach and Marketing Strategies This project has many strengths, starting with Alaska’s existing well-developed cross-industry and interdepartmental cooperation between partners that can act quickly and deliver quality training and services to overcome barriers and conduct responsive outreach to disadvantaged communi- ties. This project joins experienced leadership, trainers, strategic partners, and employers who understand the geographic, climate, technological, and cultural nuance of Alaska and are currently delivering programs, projects, and training to Alaska communities and households across the state. One effective strategy is to engage community leaders and organizations as trusted intermediaries. These individuals and groups can bridge the gap between the solar program and the community, providing insights into culturally sensitive messaging and helping build trust. Hosting commu- nity workshops and information sessions in familiar and accessible locations, such as community centers or places of worship, can also facilitate engagement. Additionally, using culturally relevant imagery and stories in marketing materials can resonate more deeply with the target audience. Highlighting how solar energy aligns with cultural values, such as sustainability or self-sufficiency, can make the program more appealing. 25 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Furthermore, creating partnerships with local organizations and businesses that are already embedded in the community can enhance outreach efforts. These partners can help promote the program and facilitate community engagement. Overall, culturally appropriate and responsive outreach and marketing for solar programs involve a holistic approach that respects cultural diver- sity, fosters trust, and addresses the unique needs and preferences of each community, ultimately promoting greater participation and adoption of solar energy solutions. Accounting for Diversity in Community Engagement The project team recognizes the value of a meaningful and targeted approach to advancing diver- sity, equity, inclusion, and accessibility. Alaska’s program partners include solarize campaigns, regional housing authorities, and weatherization providers that have extensive experience working with low-income and disadvantaged communities. The program team will consult with these and others to ensure engagement with different types of communities, including those with limited English proficiency, and where different types of residential buildings occur. The following is a description of the methodology the team will implement in project design and implementation. i. Equity: Project partners have shared commitments to 1) build a diverse workforce, supported by equitable operations and policies, and establish an informed culture that delivers authentic inclu- sivity; 2) promote economic opportunity for Alaskans through investments, including working with businesses owned by Black, Indigenous, People of Color, women, and others who have been historically and/or are currently marginalized; 3) utilize the viewpoints of those who reside in the communities and who are likely to be affected by the outcomes of the project; and 4) invest in the protection of marginalized communities from environmental hazards. ii. Diversity: Project partners have shared commitments to 1) a workforce that is talented, diverse, and committed to fostering a safe, fair, and inclusive workplace; 2) ensure all voices, regardless of social identity or social demographics, are heard and their views influence project decisions; 3) work with stakeholder groups to aid in communication with the community and project personnel. iii. Inclusion: Project partners have shared commitments to 1) include the diverse perspectives within this project’s scope and deployment; 2) leverage investments and increase pathways to opportunity for minority-owned and disadvantaged business enterprises, and for individuals who face systemic barriers; 3) participate in meaningful engagement with communities that are diverse and underrepresented in the creation and implementation of the programs and projects that impact the daily lives of their communities by creating more transparent, inclusive, and on-going consul- tation and collaboration process; 4) ensure the project includes practices based on community engagement to avoid harm to frontline and vulnerable; and 5) provide training to staff to promote inclusion internally and externally. iv. Accessibility: Project partners have share commitments to 1) strengthen accountability policies and procedures, create a more accessible and disability-inclusive workplace, and foster a greater respect for religious diversity; 2) ensure that reasonable accommodations are handled with tact and care to provide community members as well as employees the opportunity to fully participate in project activities; 3) develop and implement a process to increase awareness of accessibility tools and disability inclusion; 4) review and evaluate disability inclusion policies and practices in crisis and emergency management including, but not limited to, planning and response for pandemics, disasters, and evacuations in the domestic context; 5) examine options to enhance technological accessibility; and 6) increase awareness of religious accommodations. 26 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Inclusion of Low-Income and Disadvantaged Communities in Program Design and Operations AEA and AHFC serve low-income and disadvantaged communities as the state’s energy and housing authorities. This program is responsive to the experience that respective staff have in identifying and working to meet the needs of disadvantaged residents and communities. To best involve low-income and disadvantaged communities in the design and delivery of AEA’s solar energy program, a comprehensive and community-centric approach is crucial. AEA will initiate a collaborative process by conducting outreach efforts to understand the unique needs, preferences, and challenges of these communities through surveys, focus groups, and community meetings. AEA will establish strong partnerships with local community organizations that have existing trust and influence within these communities. These partnerships can help bridge the gap between the program and the community and facilitate culturally sensitive engagement. Project partners will engage community members in decision-making processes, empowering them to shape the program’s design, goals, and priorities. AEA will offer educational resources and training programs to ensure that residents are well-informed about solar technology and its benefits. Finally, AEA will maintain an open and ongoing dialogue with the communities, creating feed- back mechanisms to continuously refine the program based on their input. This approach ensures that the program is not only accessible but also truly responsive to the unique needs and aspira- tions of low-income and disadvantaged communities, fostering equitable access and community ownership of solar energy solutions. Community Participation in Program and Project Design AEA and AHFC held a preliminary stakeholder engagement session on August 16, 2023 as part of the project development process, with more than 30 organizations represented. This stakeholder engagement event was the first of many planned events. AEA and AHFC will deliver timely and continuous public involvement opportunities consistent with the program goals. The project team will facilitate a series of informational and engagement events across the state, encompassing both in-person and virtual formats. Outreach efforts will utilize various platforms and outreach tools. The public involvement objective is to increase Alaskans’ awareness of the program and gather public input on the administration of the funds. Public involvement will provide transparency in implementation and increase understanding of and enthusiasm for solar energy. At the preliminary stakeholder engagement session, project surveys were distributed to stake- holders to solicit feedback on the proposed program. Three areas emerged as important to participants: workforce development, maintenance and operations, and diversity and inclu- sion. AEA has built these focus areas into the program design. AEA will convene an advisory committee that will include community stakeholder organizations, such as housing authorities, utilities, Alaska Native regional and village corporations, local governments, and consumer groups. This committee will meet quarterly. Serving and Meaningfully Involving Alaska Native Communities The majority of communities in Alaska contain Alaska Native village statistical areas (ANVSAs), which are defined by the U.S. Census statistical geographic entities representing the permanent and/or seasonal residences for Alaska Natives who are members of, or receiving governmental services from, the defining Alaska Native village (ANV) located within the region and vicinity of the ANV’s historic and/or traditional location. The White House considers all Tribal lands to be disadvantaged, and the project team recognizes that the majority of its program funding will fall within these communities. 27 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE AEA and AHFC have decades of experience serving and meaningfully involving Alaska Native communities. Through the Renewable Energy Fund (REF), AEA has administered nearly $190 million in grant funding to Tribal entities for development of clean energy proj- ects throughout the State. AEA will build on this extensive network to engage with Alaska Native communities and collaboratively implement projects that address the unique needs and challenges faced in Rural Alaska. In addition to its Weatherization Assistance Program, AHFC administers approximately $3 million every year to Alaska’s Regional Housing Authorities through its state funded Supplemental Housing Development Grant program that supple- ments Native American Housing & Self-Determination Act funding whose uses are statutorily limited. As such, housing development work in many Alaska Native communities advances by allowing regional housing authorities to leverage their HUD funding for infrastructure devel- opment and energy efficient improvements that would not be possible in isolation. AEA and AHFC are working with the Alaska Native Tribal Health Consortium (ANTHC) and Tanana Chiefs Conference (TCC) to coordinate their application under the Tribal Organization funding opportunity. This will ensure that Alaska’s programs are complementary and do not overlap in either communities served or workforce development areas, and ensuring AEA helps serve Alaska’s Tribes through all aspects of the Solar for All Program. 7. Program Planning Timeline and Workplan Narrative Planning and Implementation of Solar for All AEA’s planning and implementation of Solar for All includes a year for planning and four years for implementation. The Program Planning Workplan is included in Attachment D and describes the first year’s planning activities. The Implementation Workplan is included below as a GANTT chart with steps and milestones to implement the strategies and plans of the program. AEA will use the planning period to develop a Request for Applications, refine scoring criteria for applications, and perform extensive outreach and communication statewide. AEA will aim to solicit and evaluate one round of applications in the first year of planning. Due to the seasonality of construction in Alaska, AEA aims to award funds to construct the first community solar projects in summer 2025. AEA and AHFC will also explore the potential of bulk ordering panels to save project funds and expedite deployment. AEA will solicit applications for community solar projects on an annual basis, allowing time to evaluate and set up subgrant agreements on a timeline that allows projects to be planned for and constructed in the summer months. AEA will spend the first year planning and refining the program, and anticipates four rounds of applications for community solar projects with approximately four projects awarded each year (16 community projects in total). The main program that AHFC will create under the Solar for All will be a Subsidized Residential Rooftop Solar program for low-income and disadvantaged households. AHFC will further develop the program, upon award, during the year of planning, including working with installers and other stakeholders to overcome the relatively immature solar market and scale of potential need. Alaska has the 2nd highest electrical rates in the nation and is facing an uncertain energy future, with the Cook Inlet region’s natural gas production over the next 10 years in a highly uncertain state. This uncertainty has been especially felt in Alaska’s lower income households who have mostly been unable to access the benefits of solar energy. Traditionally a solar installation would have a payback period stretching 10 years or longer, which is a difficult debt for a low-income household in Alaska to take on. AHFC’s Residential Rooftop Program aims to bring the benefits of solar power directly to households most in need. Task/Milestone/No-Go Decisions Year 2 Year 3 Year 4 Year 5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 Meaningful Benefits 1.1 Project partners determine household savings through program delivery 1.2 Program identifies ownership models and resilience benefits 1.3 Community education and equity assessment 1.4 Partners actively involved in project M1 20% household savings to program beneficiaries M2 Low-income and disadvantaged households’ access to solar increased M3 Job creation and business development is documented NG Program unable to achieve 20% household savings. 2 Market Strategy 2.1 Community solar program evaluates potential and need 2.2 Residential solar program evaluates potential and need M1 Annual analysis and progress report for community solar M2 Annual analysis and progress report for residential solar NG Need met or potential unproven or limited 3 Financial Assistance 3.1 Call for community solar projects and project review 3.2 Call for residential solar program delivery partners 3.3 Project evaluation of grant compliance occurs 3.4 Additional methods for financial assistance identified M1 16 rural community solar projects selected and completed (4 per year) M2 400-500 households served with residential solar M3 All project funds expended NG Financial assistance determined not to be meet outcomes 4 Technical Assistance 4.1 Implement cohort approach for community solar. 4.2 Provide techno-economic evaluation of community solar. 4.3 Provide application assistance for community solar. 4.4 Implement workforce development plan. 4.5 Conduct residential solar assessments as needed 4.6 Ensure adequate installer support and training. M1 16 communities participate in cohort trainings and planning. M2 Workforce training for disadvantaged communities. M3 Installers available in each region. NG Workforce development isn’t able to attract adequate participation. 5 Equitable Access 5.1 Implement customer acquisition strategy. 5.2 Public outreach campaign on solar benefits. 5.3 Community engagement that accounts for diversity. M1 Stakeholder advisory committee mobilized. M2 Projects are positively benefiting disadvantaged communities. NG Inadequate participation of low-income or disadvantaged communities. 28 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE 29 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE AHFC’s Rooftop Solar program will be primarily providing Alaska’s grid-connected low-income and disadvantaged households with fully subsidized rooftop solar installations. A household will apply for the program and their income will be verified to ensure they are eligible to participate under the parameters of the program. They will be entered into the program and will receive a household Solar Assessment that will indicate if they are a good candidate to proceed based on their roof profile, status of their electrical system and if their utility bundle and payments ensures they will receive minimum 20% savings as required by the program guidelines. AHFC will create an “Enabling Upgrades” fund as part of the program so that low-income and disadvantaged house- holds that qualify for the program but whose household would need specific upgrades to ensure a successful solar installation can receive those upgrades. As the administrator of Department of Energy’s upcoming Home Rebate program, AHFC will further leverage the Beneficial Electrification point-of-sale rebates for households that need specific electrical upgrades and qualify under that program. Once the household has been determined to be income qualified and a good candidate for rooftop solar, they will be assigned to a Solar Installer. Once the installation is complete it will have to be inspected; in municipalities and cities that require and have electrical inspectors, this will be done by the Authority Having Jurisdiction (AHJ). In other locations a third- party professional inspector will perform inspections on the first 5 installations of a Solar Installer in the program and some percentage on an ongoing basis. AHFC will use the programming period to explore using its existing Building Monitoring Software (BMON) to monitor the performance of all the installations under the program to ensure their rooftop solar system is functioning properly and providing the household with maximum benefits. AHFC’s plan involves standardizing the solar installation packages to a 4 kW system for most households with allowances to be built in for +/- a certain number of panels for households where the standard installation size would not be a success. This standardization of the installs will simplify the permitting process, simplify and standardize the procurement process for both approved installers and procurement of panels and components, streamline the assessment for households entering the program, and allow for efficient approval and monitoring of installations. AHFC will use the planning period to design a grant program for Multi-Family Rooftop Solar. This program will address access to capital, regulatory barriers, capacity of housing owners, energy efficiency integration and tenant benefit and engagement. Specifications will be created to include master-metered and multi-metered buildings and ensure households in both buildings will receive 20% savings or an equivalent benefit. The program will include multi-family units that are HUD-supported, or where rental assistance is provided to privately owned multi-family buildings with rents not exceeding 30% of 80% of AMI for at least half the residential units and with an active affordability covenant from one of the approved federal or state housing assistance programs. AHFC will open an application period until the program is over or funding is expended. Applications will be scored on a variety of metrics, including economic or otherwise disad- vantaged Alaskans served by the building, benefits to tenants and how they will be guaranteed, amount of external or private funding included in their plan, cost per kW, etc. AHFC will identify partners such as ACEP, NREL and local installers to confirm the standard solar installation parameters during the planning period. This will be done to standardize the installations but not so detailed that it prefers one manufacturer or installer over others. After the specifications are finalized, AHFC will begin an open RFP process for Solar Installers across the state, with the goal of having one or two installers covering each urban area. An installer will need to agree to the program guidelines, be licensed, and insured. 30 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE AHFC will use its existing Weatherization Assistance Program network to identify households that have been through its weatherization process in the last five years that would be good candidates for rooftop Solar. As this is a new program being set up in the State, these initial homes will function as the initial pilot households while the program is being finalized and later opens up to more Alaskans. AHFC will create an Enabling Upgrades fund that will be used for households that are income qualified for the subsidized Rooftop solar program and would be good candidates for a solar installation but need a structural, electrical or envelope upgrade to ensure the installation is successful and provides the benefits as required. This could include structural reinforcing, tree removal, roofing (limited), electrical upgrades. To access the enabling upgrade fund, one of AHFC’s weatherization partners or Solar for All Solar Installers would have to identify the need through an initial solar assessment. Households needing upgrades to their existing electrical system will be encouraged to utilize the forthcoming DOE Beneficial Electrification Rebates that include point of sale rebates of $2,500 for electrical wiring and $4,000 for electrical panel and load center upgrades. AHFC will be administering these rebates for Alaska and will thread these benefits together to benefit low-income and disadvantaged households. Refining Program Plan during Planning Period AEA and AHFC have designated the first year (not more than 12 months) of its program plan to be a planning period. This will ensure that the partners establish the necessary relationships and processes identified in various components of this application. Critical to this will be the input from the program’s advisory committee, which will review the activities identified to deliver meaningful benefits, technical assistance, a market strategy, and an equitable involvement plan. AEA will conduct a feasibility study of solar potential relative to communities potentially eligible based on disadvantaged status. This will include updating the most recent assessments. AHFC will conduct a similar assessment in urban areas of Alaska, further refining its targeted approach to delivering residential solar. The most crucial element of the planning period will be stakeholder engagement, with a focus on further developing the program’s approach to inclusivity, diversity, equity, and access. Any named entity in this application should not be considered a subrecipient unless an MOA committing to coali- tion participation is included. AEA has included multiple organizations for reference as resources, anticipating that during the Planning Period any additional partners can be identified and formalized. Consideration of Other Resources for Planning Purposes AEA and AHFC will utilize this planning period to strengthen their capacity to deliver community and residential solar, utilizing best practices and leveraged resources from across the nation while also applying lessons learned to Alaska’s unique geographic and cultural conditions. AEA recognizes the value of DOE’s States Collaborative and National Community Solar Partnership’s direct expertise and capacity building services. AEA is an active member of NCSP and the project team will reach out to these and other programs upon award and participate in trainings and information sharing as available. AEA anticipates collaboration with other Solar for All awardees, including in Alaska where a Tribal award would be beneficial, but also in similarly situated states in Region 10. The State will also have completed its initial greenhouse gas emissions inventory funded by EPA’s Carbon Pollution Reduction Program and administered by Alaska’s DEC, and Alaska’s Priority Climate Action Plan should be complete. AEA’s Solar for All program will fit well within further development of Alaska’s Comprehensive Climate Action Plan development and the State will work in this first year to develop a structure for collaboration. 31 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE AEA and AHFC will further evaluate the potential for Alaska projects to benefit from EPA programs such as the National Clean Investment Fund and Clean Communities Investment Accelerator. This effort may include further developing the ability for other organizations in Alaska to benefit from or develop corresponding programs, including through Community Development Financial Institutions (CDFIs). Period of Performance This project’s period of performance is five years, with the first year an extensive planning and stakeholder engagement process designed to advance the development of AEA’s delivery of mean- ingful benefits, technical assistance, and effective financial assistance programs. All funds will be expended by the conclusion of the five-year award period. Program Administration Narrative 1. Budget Narrative Efficient and Cost-Effective Deployment of Funds AEA has applied for a reasonable level of Solar for All program funding, which based on its analysis makes targeted, meaningful progress toward meeting the need for community and residential solar. AEA and AHFC have partnered to deliver this program and evenly distributed the total $100 million request between AEA’s management of community solar and AHFC’s management for residential solar. AEA has budgeted $41,325,000 to directly fund community-owned solar proj- ects, and $5,061,663 to cover administrative costs, travel, supplies, and indirect costs. AHFC has budgeted $40 million to directly fund residential and multi-family projects, $3.5 million for an enabling upgrades fund, and $3 million for program administration. The remaining $7.1 million will be allocated for workforce development, technical assistance, and outreach activi- ties. This is an efficient allocation of funds between community and residential solar, allowing Alaska to meet different needs for different communities. Low-income households in rural Alaska will benefit most from community solar projects, while in more urban areas residential solar may be more feasible. Thus, Alaska’s approach is prudent and necessary to achieve the outcomes of the program. AEA and AHFC have budgeted $7.1 million for Technical Assistance, Workforce Development, and Community Outreach. These activities will be jointly funded and aim to benefit both the Residential and Community-based aspects of the program. Technical Assistance is budgeted at $2,365,102 over the five year period of performance and based off analog data and outreach to potential technical assistance partners. Workforce Development will be critical to ensuring a successful program and is healthily funded at $3,498,235. The potential avenues to direct these funds have been discussed in previous sections of the narrative. The overall goal is to leverage existing programs statewide to quickly and effectively create a solar workforce in Alaska. Outreach is budgeted at $1,250,000 and is a highly important aspect of this program. AEA and AHFC aim to partner with organizations throughout the state to get the word out about this program and recog- nize that the targeted communities and households will require a more dedicated and intensive outreach effort than previous grant opportunities administered. 32 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE The project budget total of $100 million includes and the following provides detail for relevant cost categories: • Personnel – AEA’s estimated personnel costs of $2,357,850. include a list of all staff positions by title, percentage of time assigned to the program, and total cost. While a portion of time will be spread across the agency, three program project managers will be the bulk of this expense category. Costs are estimated to increase by 4% annually. • Fringe – AEA’s fringe includes leave, employee insurance, retirement and unemployment bene- fits. Fringe rates range from 43.6-56.93%, and are based on actuals. • Travel – AEA has budgeted $36,770 for limited direct travel to communities for site visits. The majority of travel will occur by subawardees and has separately been accounted for within their budgets. • Equipment – No equipment is anticipated for this program. • Supplies – AEA has estimated a limited budget for office supplies and equipment under appro- priate thresholds, which includes office equipment for program staff. • Contractual – AEA has included community solar project awards under Contractual, as well as contractor support of $100,000, on an as-needed basis. – Community Solar Projects - $41.3 million will be available for project proponents to access for community solar, and to pay for implementation through contracted awards. • Construction – Construction costs are addressed under Other as part of subaward costs. • Other – This cost category includes printing for outreach, participant support costs, and subaward costs. Subrecipient budgets are estimated below: – Alaska Housing Finance Corporation (AHFC) – As AEA’s primary partner, the budget includes $46.5 million for delivery of residential solar. – Alaska Works Partnership (AWP) - $3.5 million is budgeted for AWP and others to coordinate and implement solar workforce development training. – Alaska Municipal League (AML) - $1.25 million will be available to AML and others to conduct equity and stakeholder engagement activities, including to work with communities for meaningful inclusion and benefits. – Alaska Center for Energy and Power (ACEP) - $2.4 million will be available to ACEP and others to used for technical assistance, which will include techno-economic analysis. • Indirect – AEA’s provisional indirect rate is calculated at 30% and is applied to all direct costs, including up to the first $25,000 of each subrecipient award. • Total – The total budget applies 84.8% of its budget to community and residential financial assistance. Where travel or supply needs overlap, AEA and AHFC will identify ways in which to avoid dupli- cation and make the most of available funds. AEA and AHFC will collaborate on their approach to technical assistance and workforce development, while recognizing that skill sets, subject matter expertise, and types provided might vary according to activity. The program is designed to meet the needs of both and to utilize funds efficiently without duplicating efforts. Achieving Target Minimum Funding Amounts for Financial Assistance AEA has designed its budget to maximize the amount of financial assistance that will be available for project deployment. AEA has exceeded the minimum expectation of at least 75% of funds and developed a budget that allocates 84.8% to community and residential solar financial assistance. 33 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE 2. Fiscal Stewardship Plan Ensuring Compliance with Grant Terms and Conditions AEA has mature staff and management systems in place to administer this award. AEA has a full suite of qualified individuals and a system of checks and balances in place. AEA’s Finance and Accounting departments manage the fiscal compliance and reporting requirements for grants and sub awards. Additionally, AEA staffs a grants department that includes a grants manager and a grant coordinator. Internal control procedures are in place for compliance reviews, budgetary controls, invoice approvals, periodic reporting both project status and financial. AEA hires an independent audit firm to report on compliance for each major federal program; report on internal control over compliance; and report on the Schedule of Expenditures of Federal Awards required by the Uniform Guidance. In AEA’s FY2022 Single Audit Report it was found that the Alaska Energy Authority complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2022. AHFC has a robust internal audit department that ensure all departments and programs comply with relevant laws, regulations, and policies and procedures. The primary purpose of the Internal Audit Department (IAD) is to assist AHFC with achieving the highest level of quality performance and excellence. Among other responsibilities, IAD provides compliance guidance to residential building owners/ property managers and developers. The agency also has a system for grantee financial and adminis- trative review that includes performance management. Description of Policies and Procedures AEA will administer program funds through reimbursable grants to selected community solar projects in Rural Alaska. Payments are made after a multi-step verification and review of submitted invoices and progress reports. AEA performs due diligence for all issued grants. All invoices and progress reports are subject to a multi-level internal review and approval process prior to reimbursement of funds. A Project Management Plan (PMP) will be written by the AEA project manager for each community solar project. The PMP will outline project objectives, known risks, reporting requirements, and specific scope and budget requirements. All PMPs will be reviewed by AEA’s Grants and Finance departments as well as the Program Manager and Executive Director. AEA policies and procedures are included online, including for Procurement, Governance, and Annual Reports and Audits. AHFC policies and procedure manuals are available for each program it operates; these are available here - https://www.ahfc.us/tenants/resources/manuals. AHFC engages an external auditor that performs compliance reviews (including site inspec- tions) of Low-Income Housing Tax Credit, Senior Citizens Development Fund (SCHDF), HOME Investment Partnership (HOME), and Neighborhood Stabilization (NSP) funded developments. Reviews are mandated by the Housing and Urban Development (HUD) and the Internal Revenue Service (IRS). Consumer Protection Plan The consumer protection plan will be finalized during the first year’s planning period and informed by the program’s advisory committee and subject matter experts. The following provides a summary of standard practices that have been used by project partners in the past. 34 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE The program team anticipates contracting with third party inspectors to perform initial inspection on the first five solar installation performed by solar installers working under the residential rooftop program, and similarly for at least two of the first community solar projects. Annual inspections will occur on a representative sample of project installations thereafter. AHFC is exploring ways to use its in-house open source BMON Building Monitoring Software to remotely monitor rooftop solar installations performance, with permission of the homeowner, and identify and correct any issues in a timely fashion without burdening the resident. Practices for Consumer Protection and Process for Screening Entities Any contracted support will be secured through a procurement process prior to implementation. The companies performing solar installation will need to be licensed and insured. All partners in the program will be required to agree to the guidelines and rules of the program including compliance with applicable consumer protection laws in the State of Alaska, fair lending laws, and federal consumer protection and consumer financial laws, including laws that prohibit unfair, deceptive, and abusive practices. AHFC has previously set up large phone banks to handle customer interaction, recently for the State Rebate Programs administered from 2008-2018, and the COVID-19 Emergency Rent Relief and Homeowner Assistance Fund programs, and likely will do the same for the forthcoming DOE Energy Rebate programs. AHFC has capacity and dedication to ensuring clients are heard and their concerns addressed. Client complaints will be monitored, tracked, and logged to ensure they are resolved in a timely fashion. There will be a procedure in which a program partner that receives too many valid and verified client complaints will be removed. AHFC’s Weatherization Assistance Program also has a well-established process in place for delivering success. The Weatherization program process starts when income eligible applicants apply with one of the weatherization service providers. If the applicant meets qualifying criteria, they are assigned a priority based on need. Weatherization service providers move through this list in order and schedule weatherization assessments. The weatherization service provider does an assessment of the home and creates a list of recommended energy efficiency, health, safety, and repair measures. These measures are prioritized and performed based on program guidelines, assessment, performance testing, professional expertise, and experience. AHFC performs quality control inspections on all its weatherization partners at regular intervals to ensure compliance with program requirements and successful outcomes for the households served. 3. Reporting Plan Executing Grant Reporting Requirements During the period of performance, AEA will prepare reports in compliance with program require- ments including SF-425 and SF-271, unless otherwise specified in the program award. The project team will utilize a data collection, tracking, and reporting system to manage and report perfor- mance measure data. Performance measures reflect system, program, activity, and individual-level data, and will feature sharing data across systems and organizations and gathering information on individuals served. A data management agreement will govern how organizational partners share data. The partners will utilize standard tools such as a spreadsheet to track data, and data will be aggregated across the reporting period and reported across individuals served, and not per individual, to protect identities. The project team will utilize a logic model to provide a graphic illustration of how the project’s planned activities will lead to the desired results. The program’s logic model will clearly identify the program goals, objectives, activities, and desired results; 35 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE clarify assumptions and relationships between the program or initiative’s efforts and expected outcomes; communicate key elements of the program; identify what to focus on in a program evaluation and guide assessment of underlying project assumptions and promotes self-correction. AEA will adapt our reporting requirements from grantees to comply with any additional require- ments set forth by the EPA when funds are awarded. Complying with EPA Program Performance Reporting Requirements AEA will comply with EPA’s established program performance reporting requirements consistent with and established in the terms and conditions of the grant award. AEA will establish procedures for doing so during the first year’s planning period, including to work closely with EPA to ensure appropriate methodologies and processes. Underlying Methodologies, Data, Inputs and Assumptions AEA implemented a robust analysis to determine potential program outputs and outcomes, utilizing historical and programmatic data along with various models that can be shared with EPA. AEA will report on these metrics on an ongoing basis. A brief summary is included here, for community solar: • AEA utilized the actuals of analogous projects in rural Alaska to determine average all-in construction cost of $10.57 per W for solar and separately $7,235 per kWh for storage. • To determine avoided tons of CO2, EPA’s Avoided Emissions and Generation Tool (AVERT) is used. • A capacity factor of 14% was applied to all project impact calculations, based on data supplied in Appendix F of the NOFO. 14% is likely on the high end of what AHFC and AEA would expect to get from a typical project, but used the EPA supplied value for consistency. • To calculate households impacted and household savings, AEA referenced the “PCE FY22 statistical report by community” published by AEA. Power Cost Equalization (PCE) represents disadvantaged communities that pay higher costs than an urban equivalent. • To determine representative energy numbers for communities, AEA filtered out regions with low solar productivity (Aleutians and Southeast Alaska), then filtered out smaller utilities (<1.5MM kWh/yr), and communities that already had renewables. • Based on analog data we can expect an average community project to have a capacity of 234kW plus 360kWh battery for $2.475 million. • Beyond this modeling, AEA anticipates that all rural, disadvantaged communities will be eligible for the program. Based on PCE data, a representative project community has the following characteristics: – Population: 634 | Avg number of residential customers: 219 – Annual Generated kWh: 4,671,110 – Avg residential rate: $0.48/kWh | Avg effective rate: $0.25/kWh – Avg fuel price: $3.30 | Avg kWh/month: 319 – Avg fuel cost per kWh: $0.29 • To determine household savings for community projects, AEA used the effective residential rate (including PCE subsidy) of its representative community and compared that to an expected residential rate with 100% of the proceeds from solar sold being evenly distributed back to the community. Some projects will allocate a portion of those funds towards an Operations and Maintenance budget for the asset. This allocation will vary from project to project, and commu- nities within the same region will be encouraged to coordinate and jointly fund an O&M position that serves multiple communities. Contracts will be written to ensure that a minimum amount of revenue be dispersed back to the community to meet the required 20% savings threshold. 36 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE For residential solar, the following assumptions were used: • Data provided by local installers and university partners at ACEP show an average all-in residen- tial rooftop solar project cost of $3.80/W, though this cost varies widely based on geography. • To determine avoided tons of CO2, EPA’s Avoided Emissions and Generation Tool (AVERT) is used. • To determine the number of residential households served, AEA uses the assumption that the standard array size will be 4kW. • To determine household savings, AEA used the averages of retail and wholesale electric rates from four local utilities - CEA, GVEA, HEA, and MEA. • According to ACEP’s net metering update, 68% of net metered electricity is fed back into the grid. AEA made the conservative assumption that all electricity is bought back at the wholesale rate. In reality, this varies from house to house. In Alaska, net metering is trued up monthly with any excess that month bought back at wholesale rate. AEA will work with EPA to ensure compliance with standardized reporting requirements, including to identify tools to support reporting. Integrating Program Evaluation Activities AEA will ensure that milestones are being met and that communities receive support necessary to track and report quarterly progress that includes surveying of stakeholders to determine the extent to which projects are on track to achieve beneficial outcomes for disadvantaged communities. Communities with little capacity will receive support to track and report without adding to their operational burdens. The project team has built into the performance periods a gap year during which extensive process review will identify any weaknesses in the program delivery. Project sponsors will be interviewed to learn about challenges and solutions, which will be applied to redevelopment of the program, as necessary, to strengthen implementation through the life of the rest of the project. The final year of the project will ensure that solar integration is completed in a timely and effec- tive manner, consistent with scope and objectives. The project team will complete its evaluation process with an in-person workshop that includes a comprehensive review of all projects, project delivery, stakeholder engagement, and community benefits. A summary of findings will be released when the project is completed, developed in collabora- tion with participating communities and project sponsors, and shared with those communities and the public at large. This approach will ensure that learning drives future performance. AEA will comply with EPA Order 1000.33 and make use of available guidance and tools to ensure accurate evaluate and reporting. As public agencies, both AEA and AHFC are subject to public records requests and will be transparent in their program development and implementation. Programmatic Capability and Environmental Results Past Performance: AEA is an independent and public corporation of the State of Alaska, est. 1976 and is governed by a board of directors with the mission to “reduce the cost of energy in Alaska.” AEA is the State Energy Office and lead agency for statewide energy policy and program development. AEA’s core programs work to diversify Alaska’s energy portfolio, lead energy planning and policy, invest in Alaska’s energy infrastructure, and provide rural Alaska with technical and community assistance. The impact of AEA’s programs extend to the construction of rural power generation and bulk fuel facilities, distribution systems and transmission lines, renewable energy asset construction and integration, and ad-hoc maintenance and improvement of aging infrastructure. Rural Electric Utility Workers continuously travel to rural communities to administer itinerant training to rural 37 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE utility operators, and diligently maintain an inventory and assessment record for nearly every rural powerhouse in the state by conducting comprehensive on-site assessments. This record informs the powerhouse construction schedule and ensures alignment with community needs. AEA is committed to advancing and sustaining rural power systems across rural Alaska, and commenced the construction of powerhouses for rural and tribal communities upon its inception in 1976. Since then, AEA has touched the power generation systems, and worked with stake- holders from nearly every community in the state to provide supply and demand energy services. In the past two years, AEA has overseen ten rural powerhouse upgrade projects at different stages of development in the communities of Akhiok, Napaskiak, Nikolai, Venetie, Rampart, Nelson Lagoon, Manokotak, Circle, Akiachak (DERA) and Arctic Village (DERA). AEA maintains a strong commitment to follow through on delivering energy improvements for communities and often seeks additional project funding beyond what is provided by the Denali Commission and the State. Recently, AEA sought funding on behalf of the communities of Napaskiak and Nelson Lagoon through the USDA High Cost of Energy program and the Aleutian Pribilof Island Community Development Association’s Infrastructure fund to support rural powerhouse construction projects. AEA was awarded over $3 million through these efforts. Relationships and partnerships are in place with all Alaska energy stakeholders, including small rural non-profits and utilities, large regional and village Alaska Native Corporations and tribal governments, conserva- tion organizations, municipal governments, and technology- or solution-oriented working groups. Many organizations contribute to the development and support of infrastructure in rural Alaska, such as DOT&PF, responsible for airport infrastructure, ANTHC, focused on water and sanitation, local school districts, who support K-12 public school facilities, among others. However, when it comes to rural energy infrastructure, AEA indisputably takes the leading role. As the market progresses toward a clean energy future, AEA’s efforts have adapted accordingly. Rural utilities and powerhouses that were once exclusively powered by diesel are now seeking to transition to solar energy solutions. This shift demands careful consideration. Diesel generators in rural communities are sensitive to load fluctuations, as they can impact the efficiency of the gensets, and excessive fluctuations can result in damage to the diesel generators, which serve as the backbone of the rural microgrid. Integrating renewables into diesel microgrids is a complex undertaking that requires the expertise of qualified and responsible entities with a track record like AEA’s of reliable energy infrastructure deployment across the state. AEA is engaged in all levels of consumer energy from project and resource identification, appro- priate design, and to financing and maintenance. Over decades of experience developing energy projects in Alaska, AEA has continuously improved its process, application of technology, and delivery of service. AEA integrates energy technology and advances in grid services into all program areas both on the supply- and demand-side. AEA will partner with AHFC, as the primary partner and subrecipient to manage the residential solar program. It is worth highlighting AHFC’s capabilities, with this in mind. AHFC is a quasi-state entity that makes mortgages accessible to Alaskans and provides affordable housing and energy efficiency programs. AHFC’s mission is to provide Alaskans access to safe, quality, affordable housing. AHFC delivers a variety of programs to meet this mission, including building code development. AHFC has administered several code process and programs since 1992 making the organization uniquely qualified to perform this project’s tasks. AHFC established the Building Energy Efficiency Standards (BEES) to promote the construction of energy efficient buildings. AHFC facilitates training and education for Energy Raters and Home Inspectors to become certified to sign off on BEES compli- ance. As an enforcement tool, AHFC has created a process for state inspectors to perform inspections 38 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE during construction of a new home with AHFC financing. Internal auditing and quality control poli- cies and procedures have been developed and followed to ensure compliance. Successful Completion and Management of Agreements AEA manages the Renewable Energy Fund, the Rural Power System Upgrade Program, the Power Cost Equalization Program, the Diesel Emission Reduction Act (DERA) Program, and various other Energy Efficiency and Conservation Programs. AEA has been at the forefront of supporting technology and process improvements that move Alaska communities toward renewable integration within existing power systems. AEA has managed its Renewable Energy Fund since 2008, and programs like Power Cost Equalization since 1985. AEA annually reviews the potential for microgrid projects to lower costs and reduce diesel consumption, including through the use of renewables. In addition to advancing renewable energy production for disadvantaged communities, AEA has experience with improving, upgrading, and building out rural microgrids, including through: • Renewable power generation creation and system integration (hydro, wind, or solar) • Modern distribution systems and controls • Battery Energy Storage Systems (BESS) • Modern and emission efficient diesel back-up powerhouse systems • SCADA controls between renewables and diesel back-ups AEA has successfully managed and completed over three-hundred grants in the last decade from many different agencies as well as private funds from the Volkswagen Environmental Mitigation Trust and Wells Fargo. AEA administers the DERA program to provide support for projects that protect human health and improve air quality by reducing harmful emissions from diesel engines. This program includes grants and rebates funded under the EPA’s DERA program. AEA was a successful applicant to the BUILD (USDOT) program in 2020 for the Alaska Cargo and Cold Storage Project. In 2022, the Department of Defense awarded AEA over $12 million to extend power to the Black Rapids training site near Delta Junction with an additional $3 million expected in 2024 to accommodate the installation of underground power lines.. AEA has thirty active awards from the Denali Commission, AEA’s current federal cognizant agency. These awards touch on every aspect of what the agency does. There are awards for design and construction of Rural Power System Upgrades (RPSU) and Bulk Fuel Upgrades (BFU); small renewable projects that will be integrated into a remote diesel power system; energy efficiency upgrades, Utility Clerk, Powerhouse Operator, and Bulk Fuel Operator training; small maintenance and improvements for both power systems and tank farms; as well as circuit rider technical assis- tance and on-site training. History of Meeting Reporting Requirements The wide array of current and past programs, and grant management experience, ensures that AEA is appropriately prepared to manage this project, including through a subaward and project delivery and assessment process. This is further outlined in Attachment F, but the following is a small sample of the many awards AEA manages from federal agencies: • Department of Energy – 2023 Preventing Outages and Enhancing the Resilience of the Electric Grid (Formula Grant to States) • Department of Defense – 2022 Black Rapids Line Extension • USDA High Energy Cost Grant – 2021 Napaskiak Rural Power System Upgrade • EPA – 2016-2022 State Clean Diesel Emission Reduction Act • Denali Commission – 2019 Nikolai RPSU 39 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE Experience and Plan for Achieving Outcomes AEA is the State’s primary agency responsible for lowering the cost of energy in Alaska. AEA has experienced staff and management systems in place to administer this Solar for All program, and the overall program management. AEA has a full suite of highly qualified indi- viduals, and a strong system of internal controls in place that facilitates meeting all compliance requirements. AEA’s financial and project management capabilities are demonstrated by receipt of unqualified audit opinions for both our annual Financial Statements and Federal Single Audit report, located on AEA’s website. AEA provides grants and loans for qualified energy infra- structure projects and owns energy infrastructure for the benefit of Alaskans. AEA has the legal authority to enter into a financial assistance relationship with the EPA, and is experienced with managing federal awards, including most recently the National Electric Vehicle Infrastructure (NEVI) deployment, an award of $52 million. Additionally, as an authority of the State, AEA produces an annual financial report. AEA will dutifully manage the project to ensure consistency of the interrelated community-level projects contributing to the proposed outcomes of the overall effort. AEA will maintain frequent communication with stakeholders through all stages of the project, establish project support infrastructure to ensure success, enforce appropriate standard project management practices and processes, and control for performance, scope, and budget. AEA will be responsible for initiation, reporting, monitoring and measuring project outcomes, and project close-out. AEA will work with the following partners (described further below) to implement this program and support community benefits. AEA and AHFC work closely together to achieve and manage project outcomes, and AHFC has the necessary experience and capacity to comple- ment AEA’s program. AEA will be responsible for program management, implementation, and reporting, as well as partner and stakeholder engagement. Additional roles have the following responsibilities performed by diverse team members: • Project development and identification – AEA will work with ACEP to identify feasible projects and to provide technical assistance to projects in need of development. • Stakeholder engagement – AEA will work with AML to develop a stakeholder engagement strategy that focuses on rural, disadvantaged communities and includes municipal and Tribal governments, and public and cooperative utilities. • Application support – AML will provide application support for project grantees, to overcome capacity barriers that might exist in disadvantaged communities. • Project review and analysis – AEA will convene a project review board comprised of project partners and technical experts to review projects for feasibility and impact. • Innovative financing – AEA will work with partners to develop and implement a process of private and public capital mobilization in support of project delivery. • Project deployment and support – AEA will work with AHFC and ACEP on effective ways to support project implementation, including through procurement and project management support. • Project evaluation – AEA will annually convene project partners to conduct a thorough analysis of projects both for their technical merit and community benefits. This will be a dedicated effort in year four of the project. • Reporting and compliance – AEA will expect quarterly reporting from all sub-awardees and provide technical assistance through ACEP and AML to ensure compliance. 40 ALASKA ENERGY AUTHORITY – SOLAR FOR ALL PROGRAM NARRATIVE There are multiple stages at which critical handoffs and interdependencies occur. • Project selection – Project team members will be involved in soliciting and identifying projects, reviewing projects for greatest feasibility and impact, and selecting awards. • Project management – Project team members will establish working relationships with project proponents and include technical assistance activities as part of project management, including workforce development, modeling and analysis, and project implementation support. • Benefits tracking – Project team members will work with recipients to establish systems to track technical and community benefits, which will include avoided diesel use, cost savings, and local and Tribal benefits. Relevant or Available Past Performance AEA and AHFC have demonstrated relevant past performance, provided above. Endnotes 1 https://www.seia.org/sites/default/files/2023-09/Alaska.pdf 2 https://irecusa.org/census-solar-jobs-by-state/ 3 https://www.solarpowerworldonline.com/wp-content/uploads/2022/04/Blue_Planet_Project_Shungnak.pdf 4 https://www.uaf.edu/acep/research/solar-technologies.php 5 https://www.nrel.gov/docs/fy23osti/84391.pdf 6 https://www.uaf.edu/acep/files/projects/EEM-01255_SolarDesignManual_5thEd201805.pdf 7 Circuit Rider Program (3 AAC 108.200 – 240) 8 https://www.energy.gov/diversity/community-benefit-agreement-cba-toolkit 9 https://awib.alaska.gov/pdf/WIOA_plan_2022-2023.pdf 10 The unemployment ranking ranks the lowest rate #1. 11 Anonymous. “Gauging the Economy.” Alaska Economic Trends, October 2022. 12 U.S. Bureau of Labor Statistics, Job Openings and Labor Turnover Survey, data.bls.gov; Dan Robinson, “Job Openings Near All-time High,” Alaska Economic Trends, August 2022. 13 Howard N Fullerton, Jr. “Labor force participation: 75 years of change, 1950–98 and 1998–2025.” Monthly Labor Review, December, 1999. 14 Workforce Reports. https://www.alaska.edu/research/wd/reports.php 15 Sarah Schwartz, “Early-College High School Students More Likely to Earn Postsecondary Degrees.” Education Week, September 17, 2019. 16 J. Edmunds, F. Unlu, E. Glennie, and N. Arshavsky. 2020. “What Happens When You Combine High School and College? The Impact of the Early College Model on Postsecondary Performance and Completion.” Educational Evaluation and Policy Analysis 42 (2): 257–278. 17 Improvements to college enrollment and graduation rates have been demonstrated for structured dual enrollment programs that emphasize courses leading to an associate degree and completion of the general education requirements for a baccalaureate degree. 18 Since 1976, when online data begin. Alaska DOL&WD, https://live.laborstats.alaska.gov/labforce/index.html 19 U.S. Census Bureau. American Community Survey. census.gov 20 American Community Survey questions offer “associate degree” as the first option for a college credential. Hence certificate holders without a higher degree are counted in the “some college no degree” category. 21 U.S. Census data, 5-year average of American Community Survey, 2015-2020. census.gov 22 The percentages are the number of Alaskans who attended college for the first time in-state relative to the total number of Alaskans who attended college for the first time. National Center for Education Statistics, Digest of Education Statistics, Table 309.10. https://nces.ed.gov/programs/digest/current_tables.asp Draft Sections of Statewide Energy Master Plan related to Priorities, Strategies and Actions Handout Includes: Section 4 - Energy Priorities • Priority A – Railbelt Transmission, Generation, and Storage • Priority B – Coastal Generation, Distribution, and Storage • Priority C – Rural Generation, Distribution, and Storage • Priority D – State Energy Data • Priority E – Incentives and Subsidies • Priority F – Statutes and Regulations Appendix II – Action Tracking Sheet Appendix III – Additional Action Detail Summary Alaska Energy Security Task Force Meeting October 3, 2023 STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN OCTOBER 2023 DRAFT DELIBERATIVE Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time.DRAFT TABLE OF CONTENTS Section I. Introduction Section 2. Planning Process Section 3. Energy in Alaska Section 4. Energy Priorities (Included in this Draft Package) Priority A. Railbelt Transmission, Generation, and Storage Priority B. Coastal Generation, Distribution, and Storage Priority C. Rural Generation, Distribution, and Storage Priority D. State Energy Data Priority E. Incentives and Subsidies Priority F. Statutes and Regulations Section 5. Next Steps Appendices Appendix I. Definitions Appendix II. Action Tracking Sheet (Included in this Draft Package) Appendix III. Additional Action Detail Summary Pages (Included in this Draft Package) Appendix IV. Energy Symposium Series Appendix V. Energy Data Report Appendix VI. Meeting Material Documentation Appendix VII. Public Comment Documentation STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN OCTOBER 2023 DRAFT DRAFT STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN10Section IV Energy Priorities STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE SECTION IV.ENERGY PRIORITIES DRAFT STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN 11Section IV. Energy Priorities STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE This section is divided into the following Energy Priorities: Railbelt Transmission, Generation, and Storage Coastal Generation, Distribution, and Storage Rural Generation, Distribution, and Storage State Energy Data Incentives and Subsidies Statutes and Regulations Priority A. Priority B. Priority C. Priority D. Priority E. Priority F. DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN12Section IV. Energy Priorities DRAFT DELIBERATIVEDRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE 13Section IV. Energy PrioritiesDRAFT DELIBERATIVE INTRODUCTIONThe Railbelt Generation, Transmission, and Storage (RGTS) Priority of the Alaska Energy Security Task Force was created to develop an energy plan that will move the Railbelt towards energy independence while lowering the cost to its residents over the long-term. In order to complete this plan, it was important to understand the current state of our energy portfolio. Since Statehood, the Railbelt utilities and their customers have benefited from the significant natural gas finds in the Cook Inlet. Over time, this basin has supported approximately 80% of the power generation, and a majority of the population hubs’ space and water heating needs. In order to develop our recommended plan, the RGTS determined the most efficient approach would be to establish long-term, mid-term, and short-term goals that reflect our desired outcomes here along the Railbelt. Here are the recommended goals:• Short-term: Minimize regret cost while providing reliable service. • Mid-term: Invest in infrastructure improvements to advance our long-term goal of energy diversification.• Long-term: Significantly diversify power generation with an emphasis on local, reliable, and affordable clean energy. The RGTS was motivated to seek transformational approaches to reach these goals that might provide electrical energy to residents at a target price of $0.10/kwh in the future. The RGTS reviewed numerous generation and transmission configurations and strategies from publicly available data but did not complete independent or internal cost estimates in developing action items and our strategy. The following Railbelt strategies and recommended action items are meant to support these high level goals. STRATEGIES: B-1 Unify Transmission Diversify Generation Increase Demand B-2 B-3 PLANNING PROCESS HIGHLIGHTS PLACEHOLDER FOR INFOGRAPHICS THAT DESCRIBE PUBLIC MEETINGS AND PARTICAPTION THAT HELPED IDENIFY ACTIONS AND STRATEGIES PRESENTED IN THIS SECTION DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN14Section IV. Energy Priorities DRAFT DELIBERATIVE Unify and convey all existing transmission assets along the Railbelt and Bradley Lake to AEA or a new non-for- profit regulated utility for the net book value. A-1.1 ACTIONS STRATEGY A-1: Unify Transmission Purpose:Accelerate upgrades to existing transmission from Bradley Lake to Fairbanks via Anchorage, and construct a second transmission line from Soldotna to Healy via Beluga enabling the long-term goals of improved resilience, reliability, and transfer capability between regions. This action would include unified ownership of the Railbelt transmission system and would minimize constraints on the system. Proceeds from the utility sales would help reduce debt owned by the utilities, eliminate wheeling charges, and create a postage stamp rate from Bradley to Fairbanks, thereby eliminating multiple tariffs in favor of one simplified tariff. Unified operation will lower system operating costs (rates), enable quicker interconnection of new generation sources, and reduce time to plan and construct new system components. Background:The “Railbelt” refers to the interconnected electric grid that stretches approximately 700 miles from Fairbanks through Anchorage to the Kenai Peninsula. About 70 percent of Alaska’s population is served by the Railbelt electric system. The Alaska Energy Authority (AEA) owns the Bradley Lake Hydroelectric Project, the largest hydroelectric plant in Alaska. Energized in 1991, Bradley Lake generates the lowest-cost electricity on the Railbelt and provides clean power to more than 550,000 Alaska residents. There is now a unique opportunity to leverage past investments in Bradley Lake. Through further federal, state, utility PLACEHOLDER IMAGE DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN 15Section IV. Energy PrioritiesDRAFT DELIBERATIVE and private sector investment in specific shovel-ready capital projects, Alaska can optimize Bradley Lake’s value without incurring significant additional costs to Alaskans. The Alaska Energy Authority (AEA), in partnership with the five Railbelt utilities, has identified several opportunities for transmission line upgrades and battery energy storage systems that will reduce existing constraints on the Railbelt grid by increasing the Kenai Peninsula’s transmission capacity to export power from Bradley Lake hydropower, while also allowing for the integration of additional renewable energy generation. The current system is in need of upgrades to facilitate a diverse fuel supply portfolio. Benefits:• Reduces transmission constraints on Railbelt grid, while also allowing for the quicker integration of additional renewable energy generation.• Provides system redundancy, resilience, and increases reliability.• Benefits utilities and ratepayers by sharing power throughout the region.• Reduces costs for consumers and promotes job creation.• Coordinates planning, financing, and construction of new infrastructure.• Augments and diversifies Environment, Social, and Governance investment portfolio holdings. Expected Results:This strategy will result in a more resilient and reliable transmission and electric grid system that will lower rates, help bring online clean energy, reduce costs for consumers, and promote job creation. “The “Railbelt” refers to the interconnected electric grid that stretches approximately 700 miles from Fairbanks through Anchorage to the Kenai Peninsula. About 70 percent of Alaska’s population is served by the Railbelt electric system.” PLACEHOLDER IMAGE PLACEHOLDER IMAGE DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN16Section IV. Energy Priorities DRAFT DELIBERATIVE Adopt a Clean Energy Standard with incentives to facilitate reaching diversification goals. Modify existing statute(s) requiring the commission to consider long term diversification goals when approving additional/new Railbelt power generation. Progress Known Energy Generation Diversification Projects to Go/No-Go Decision• Dixon Diversion • Susitna-Watana • AKLNG A-2.1 A-2.2 ACTIONS STRATEGY A-2: Diversify Generation Purpose:Encourage and coordinate the diversification of Railbelt generation assets through projects and policy that provide opportunities to maximize energy cost savings. Background:Today, 80-90% of the Railbelt’s energy (heat and power) is generated using Cook Inlet (CI) natural gas, a supply source which is forecasted to fall short of demand as soon as 2027. Alaska utilities may likely need to import Liquified Natural Gas (LNG) to meet short term supply needs and this is anticipated to increase the cost of energy and introduces potential energy security concerns. In order to ensure a secure, local supply of energy that is affordable and reliable, the Alaska Energy Security Task Force, (AESTF) Railbelt Subcommittee set a long term goal of significantly diversifying the Railbelt’s energy generation. Today, many proven and cost competitive electricity generation technologies exist and are ready for at-scale deployment across the Railbelt, and the state as a whole. Alternative technologies for central heat generation are not as ready to deploy and distributed heat generation solutions such as heat pumps point to electricity generation as their source. Based on this, the Railbelt Subcommittee recommends a near term focus on diversifying electricity generation. This will conserve natural gas for heat while increasing energy security with local and diverse electricity generation projects. LocationA-2.3 PLACEHOLDER IMAGE DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN 17Section IV. Energy PrioritiesDRAFT DELIBERATIVE To enable this strategy the Railbelt Subcommittee supports the state adopting a Clean Energy Standard which would set electricity diversification goals. These goals should be supported with incentives rather than penalties to ensure affordable, reliable power is delivered to rate- payers. The Railbelt Subcommittee also recommends modifying state statutes to provide the Regulatory Commission of Alaska (RCA) the ability to value generation diversification (in addition to price) when reviewing and approving contracts. The Railbelt Subcommittee did not complete comprehensive analysis or cost estimates for potential generation projects and ultimately all technologies should compete to bring the most affordable, diverse, reliable energy to the Railbelt. That said, there are projects which have previously been proposed or are currently being worked and the Subcommittee supports taking these projects through feasibility such that a “go/no-go” decision can be made. Alaska has several projects in various stages of development and permitting that could provide diversified renewable and clean power generation for Railbelt utilities including the Dixon Diversion project at Bradley Lake, and the potential mega-project at Susitna-Watana. Additionally, the Alaska LNG (AKLNG) project has the potential to open vast quantities of trapped North Slope natural gas for uses across the interior and south-central Alaska. The AKLNG is strategic in that it provides a local gas supply for heat and electricity base load for generations to come. Benefits:How can Alaskans encourage and promote diversification of power generation in the Railbelt and across Alaska to foster transition to reneable and clean energy generation sources to provide reliable, low cost energy for Alaskans. Expected Results:Greater diversification of power generation to provide reliable, lower cost electricity, heat, and transportation for Railbelt rate payers.PLACEHOLDER CALL OUT BOXPLACEHOLDER IMAGE DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN18Section IV. Energy Priorities DRAFT DELIBERATIVE Issuing an RFP to industry for a large load that would be provided at a guaranteed low energy price (the energy price could be tiered based on amount of load growth). A-3.1 ACTIONS Purpose:Significantly increase load to drive down energy rates. Background:All other things being equal, if the fixed infrastructure costs of a power grid are spread over more customers and greater energy loads, customers will end up paying less on a per-kWh basis. This strategy has been used in Iceland, for example, where a high volume of production and sales have created efficiencies and economies of scale. According to analysis provided by Holdmann and Gudleifsson (in preparation), Iceland’s total electric production and Alaska’s tracked very closely until the mid-1990s, as did the delivered cost for electric power. After that point in time, the trajectories diverged significantly both in terms of annual production and sales as Iceland actively courted and attracted large industry (aluminum smeltering) to its electric grid. This new industry increased Iceland’s energy demand by four-fold. Iceland’s cost of power delivered to the customer’s meter is now $0.7-$0.13 per kWh, as compared with $0.19-$0.26 for power from Alaska’s Railbelt grid. A similar approach could be undertaken on Alaska’s Railbelt to drive the cost of power down for all customers and spur continued economic growth. Examples of new, large customers on the Railbelt could include ore processing of locally-resourced materials as well as new fuel generation production facilities for the transportation industry (air carriers, shipping, etc.), among others. A key insight is that Iceland simultaneously sought out new industry and committed to lower than current energy costs to incentivize industry to select Iceland as the preferred location. Benefits:Incentivizing and attracting large industry customers to Alaska’s Railbelt to increase electricity production demand, following a similar model to Iceland, could help lower the cost per- kWh for all Railbelt customers. Expected Results:The Railbelt will significantly increase its load to drive down prices for all consumers and spur economic development overall. STRATEGY A-3: Increase Demand PLACEHOLDER IMAGE DRAFT PLACEHOLDER IMAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN 19Section IV. Energy PrioritiesDRAFT DELIBERATIVEDRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 20 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVEDRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 21Section IV. Energy PrioritiesDRAFT DELIBERATIVE INTRODUCTIONThe Coastal Generation, Distribution, and Storage Priority includes strategies and actions that support the overall Alaska Energy Security Task Force goal of identifying opportunities to lower the cost of energy in Alaska for Alaskans. The Coastal Subcommittee settled on four high-level strategies supported by twelve specific action recommendations focused on lowering energy costs for Alaskans living in coastal areas of the state. Strategies recommend Alaska and Federal policy updates to allow streamlined project identification, planning, funding/financing and permitting. The Market Initiatives strategy seeks to maximize use of existing energy generation and transmission assets and promote new renewable energy assets to lower energy costs for Alaskans and their industries. Finally, as hydro-power is one of the primary sources of energy generation for many coastal Alaskan communities, the Alaska Hydropower strategy recommends enhancing Alaska’s policies to fast-track hydropower for affordable, secure energy Alaskans expect by optimizing Alaska public policies and investments to promote and advance execution-ready hydropower projects to lower the cost of energy and to bolster community and regional energy security. STRATEGIES: B-1 Alaska Policy Recommendations State of Alaska Coordination with Federal Agencies and Federally Recognized Tribes Recommendations Alaska Hydropower Generation Recommendations Alaska Market Initiatives B-2 B-3 B-4 PLANNING PROCESS HIGHLIGHTS PLACEHOLDER FOR INFOGRAPHICS THAT DESCRIBE PUBLIC MEETINGS AND PARTICAPTION THAT HELPED IDENIFY ACTIONS AND STRATEGIES PRESENTED IN THIS SECTION DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 22 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Establish, require, assist, and Implement community Integrated Resource Plans (light) to forecast energy demand and generation for community and regional future energy needs and to lower energy costs. Strengthen Alaska’s Net Metering energy framework, tariffs, and regulations for Alaska’s diverse stakeholders to promote net metering renewable energy investments. Strengthen and Streamline the State of Alaska’s internal state regulatory and land use administrative processes to accelerate approval to advance strategic energy projects and transmission for regional energy security and lower energy costs. B-1.1 B-1.2 B-1.3 ACTIONS STRATEGY B-1: Alaska Policy Recommendations Purpose:Enhance Alaska’s departmental and regulatory policies to spur and sustain renewable energy and transmission development to cut energy costs and advance economic prosperity for Alaska. Background:Alaska policies, while unintended, can prevent, stall, or, in some cases, prohibit the permitting and necessary governmental authorizations to timely and optimally develop and advance renewable energy and transmission assets required to move Alaska forward from a developing state status to a first-world energy state that Alaskans deserve. While there is not one solution, the Administration can take many internal steps and actions to create a unity of effort among State agencies with disparate missions and objectives. An overarching Energy Plan that directionally provides State agencies the authority and motivation to help the Governor successfully implement that State Energy Plan and achieve recommended action is doable with a coordinated effort.PLACEHOLDER IMAGE DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 23STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE B-1.4 Alaska can transcend policies that have been focused on the past or regulatory mission and should directionally (as opposed to aspirational) incorporate the Governor’s directives to implement the State Energy Plan in concert with regulatory balance, protecting our environment while streamlining processes, procedures and producing results to lower the cost of energy for Alaskans. Regardless of whether the policy directive is called a “unity of purpose and effort” or an all-hands-on-deck policy, Alaskans are better served through introspection of how we can and should do better, with concentrated and collective efforts to do better in serving Alaskans achieve lower cost energy now and for future generations. Benefits: The proposed Alaska Policy Recommendations create multiple economic and societal benefits while providing Alaskans with administrative purpose and collective effort to find and exploit synergies to lower the energy cost for Alaskans in concert with Departmental missions and goals. Expected results: Strategically planned and matured by the Administration and AEA of the Task Force Alaska Policy Recommendations combined with efficient and well thought out implementation focused on light Integrated Resource Planning, reducing State of Alaska barriers and bottlenecks, optimizing federal funding for the strategic achievement of goals, tactical and practical implementation of can do, how we get to “yes” policies will reduce the cost of power for Alaskans today and leave an energy legacy for generations of Alaskans to follow. Strategize and Prioritize State of Alaska funding to match federal funding and federal financing to build and expand Transmission and Distribution lines in Alaska to bring Alaska on par with the US transmission systems for Alaskan energy security and lower energy costs. Establish and provide valuable energy planning and modeling metrics from State data sources, where available and requested (such as DMV electric vehicle registrations and Air Source Heat Pump (ASHP) installation) by individual communities. Recruit, Train, and Enhance Alaska workforce with technical skills and training for advancing beneficial electrification to lower Alaska energy costs and to sustain Alaska’s growing energy infrastructure. ACTIONS (CONT.) B-1.5 B-1.6 PLACEHOLDER IMAGEDRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 24 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Establish an Alaska/ federal Renewable Energy Policy Force to develop, collaborate, and prioritize State energy, plan, goals, and rights to optimally advance renewable energy and transmission on federal lands. State of Alaska partners and collaborates with Federally recognized Alaska tribes and federal agencies to develop mutually beneficial Energy Development and Transmission/ Distribution to advance the State Energy Plan to lower the cost of energy. B-2.1 B-2.2 ACTIONS STRATEGY B-2: State of Alaska Coordination with Federal Agencies and Federally Recognized Tribes Recommendations Purpose:Refine federal policy to bolster Alaska’s renewable energy and support tribes in securing affordable energy. Directionally (as opposed to aspirationally) advance Alaska’s Energy Plan priorities to promote and develop renewable energy generation and transmission assets through negotiating and influencing federal agencies for proactive federal energy development policy modifications and revisions and to collaborate and assist Alaska’s federally recognized tribes in obtaining lower cost energy in Alaska. Background:The State of Alaska has the highest disparity of power costs from one community or region to another. Some of America’s highest-cost energy communities amplify that these communities are in the Tongass and Chugach Forests lands controlled by the US Department of Agriculture (USDA) US Forest Service (USFS). Currently, there is limited or no State input or consultive rights provided by the State of Alaska to affect the federal policies of the federal government in a collaborative and constructive dialogue that lowers the cost of energy for Alaskans and reduces emissions and other national goals of energy security and lessening dependence on fossil fuels. RS 2477 (Revised Statute 2477) refers to a provision in the Mining Act of 1866, which allowed for the construction of highways across public lands not reserved for public uses. In simple terms, RS 2477 granted a “right-of-way” to build roadways and transmission lines over public land that provide access to renewable energy project areas. Section 4407 of Public Law 109-59 (Section 4407) of a 2005 federal transportation funding bill refers to a Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU). SAFETEA-LU was a PLACEHOLDER IMAGE DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 25STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE bill sponsored by the late Congressman Don Young and was signed into law by President George W. Bush in August 2005. Section 4407 provides as follows: Notwithstanding any other provision of law, the reciprocal rights-of-way and easements identified on the map numbered 92337 and dated June 15, 2005, were enacted into law. Section 4407 Rights of Way provides roadways and transmission line corridors over the Tongass National Forest, instrumental for the State of Alaska’s interests in providing access to renewable energy project areas and transmission lines. However, Tongass Forest Land Management Plans, Land Use Designations (LUD), and other federal regulations are at odds with the State exercising its rights. Coastal Alaska communities also want to lower energy, heating, and transportation costs. Federally Recognized Tribes actively explore energy solutions and are supported in tribal energy endeavors by federal resources mutually beneficial to the State of Alaska’s interests. Tribal goals align with the broader Alaska state mission of making energy more affordable for all residents. Additionally, many federally recognized tribes have designated staff working specifically on energy projects, often in collaboration with federal entities. By coordinating and collaborating, the State of Alaska, Federally Recognized Tribes, and our shared Alaskan communities can assist the wider Alaskan population by cooperatively developing and sharing efficient energy solutions. This joint party effort can enhance the creation, sharing, and use of energy across the State. Benefits: The development of state policies and goals to negotiate and carry out with federal agencies for developing cost-effective renewable energy and transmission lines on federal lands lowers energy costs for Alaskans while assisting federal agencies in meeting national clean energy goals through mutual State-Federal cooperation, respect, and understanding the proposed Alaska Policy Recommendations create multiple economic and societal benefits while providing Alaskans lower cost energy. The State of Alaska and federally recognized tribes have mutually shared goals to provide low-cost heating, electricity, and transportation to Alaskans in our Alaskan communities. By identifying and sharing information, plans, and initiatives and establishing a framework to advance energy generation, transmission, distribution, storage, and heating solutions, the State of Alaska and Tribes can optimize resources and benefits to lower the cost of energy and increase energy security for Alaskans. Expected Results:The State of Alaska, with careful and planned implementation of these recommendations, can gain common ground with federal agencies and tribes and advance and promote Alaska’s renewable energy development with cooperation and support from the federal government and Alaska’s 229 federally recognized tribes to achieve national purposes while reducing the energy cost of Alaskans. The expected results and outcomes from this cross-agency, inclusive tribal interest effort will lower Alaska’s energy costs and reduce the dependency on imported fuels, using local Alaska land and energy resources for the benefit of Alaska.PLACEHOLDER IMAGE DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 26 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Foster, Support, and Assist Hydropower development and their transmission in Alaska to lower energy costs, provide energy security, and spur economic growth, job creation, and prosperity for Alaska. B-3.1 ACTIONS STRATEGY B-3: Alaska Hydropower Generation Recommendations Purpose:Enhance Alaska’s policies to fast-track hydropower for affordable, secure energy Alaskans expect by optimizing Alaska public policies and investments to promote and advance execution-ready hydropower projects to lower the cost of energy and to bolster community and regional energy security that Alaskans deserve and expect. Background:The foundation of Alaska’s most cost-effective and affordable energy lies in its legacy hydropower infrastructure, some of which dates back decades or even a century. There is no cheaper energy form in Alaska than old hydropower, and Alaska cannot achieve old hydropower without proactively supporting and investing in new hydropower. Hydropower is a tried and proven Alaska energy resource, and with proper maintenance, these hydropower systems have a life expectancy of over 100 years. Once financing debt is paid, the hydropower project yields consistent, sustainable, renewable, and lowest-cost power, benefiting multiple generations of Alaskans and economic prosperity well into the future.PLACEHOLDER IMAGE DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 27STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Historically, Alaska’s economic vitality is due directly to its hydropower assets. Whether the small local hydropower systems that powered early mining and fishing sectors or the subsidized projects like Bradley Lake and Snettisham Hydro and the hydropower investments from the era of the Four Dam Pool, these assets have consistently provided low-cost energy, driving Alaska’s prosperity. In Alaska and across the US, the National Hydropower industry is expanding to include river hydrokinetics, tidal, and marine power projects as US hydropower projects. As these technologies evolve, Alaska’s extensive coastline and lengthy rivers — greater than all other states combined —leverage Alaska to capitalize on these innovations and benefit from these advancements to provide energy security and lower the energy cost for Alaska. Today, hydropower accounts for 29% of Alaska’s electricity. This reliable power source underpins vital sectors of the Alaskan economy: mining, fisheries, military, and tourism, ensuring energy security and economic stability for the state. Benefits:Hydropower in Alaska is not just an energy source; it is Alaska’s energy DNA. Historically, hydropower has consistently delivered the state’s most affordable power. By investing in hydroelectric infrastructure and related transmission, Alaska is not just tapping into a proven energy solution but securing Alaska’s energy future. This investment strategy, rooted in a track record over a century, offers unmatched cost-effectiveness in the long run and past most investment cycles. While the initial outlay is significant, the long lifecycle of hydropower — exceeding 100 years — ensures that Alaska is planting seeds for today’s needs and reaping energy dividends for future generations with sustainable, clean energy. Investing in hydropower assets is our Alaska commitment to Alaska’s proven energy model for a brighter, more affordable, energy-secure future for Alaska. Implementation Timeline: The Alaska Generation Strategy for fostering hydropower has a blend of Immediate for execution-ready hydropower and short-term, mid-term, and long-term tasks for hydropower in earlier analysis and development stages. Expected Results: The State of Alaska can take an active, willful, and calculated role in lowering the energy cost for Alaskans, energy security, and economic prosperity by effectively guiding hydropower development policy and investments in hydropower assets and related transmission infrastructure safeguarding Alaska’s energy future with an Alaskan tried and proven energy model.PLACEHOLDER IMAGE DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 28 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Integrate and Promote Heat Pump technology and systems (ASHP, SWHP, GSHP) as an Alternative Energy Resource in Coastal Alaska. Plan, finance, and support the execution of Shore power at Public and Private Cruise Docks to Sell Excess Energy to Cruise Ships. Beneficially electrify the Alaska Ferry Fleet to lower the cost of transportation, emissions, and assist in reducing the cost of power in coastal communities. Identify and support the colocation of industrial load (e.g. data servers) with Alaska hydropower facilities for synergies to lower energy costs. B-4.1 ACTIONS STRATEGY B-4: Alaska Market Initiatives Purpose:Maximize utilization of existing energy generation and transmission and promote new renewable energy assets to lower energy costs for Alaskans and their industries through market initiatives and expansion. Background:Energy generation and transmission assets, like power plants and electricity distribution grids, have significant upfront costs. For these assets to be cost-effective and viable, they need to be built at a particular scale, benefiting from what is known as “economies of scale,” the more significant the operation, the more cost-effective it becomes per unit of energy produced or transmitted. Market initiative and expansion of electricity is known as beneficial electrification. “Beneficial Electrification” refers to replacing direct fossil fuel use for heating and transportation with electricity to reduce overall emissions and energy costs while simultaneously delivering broader environmental and societal benefits. The primary aim is to shift end-use energy sources to cleaner, renewable electricity sources. Energy Generation and Transmission assets require minimally sufficient economies of scale to enable minimum viable generation projects and transmission to be built or expanded. Expanding energy markets through market initiatives that serve multiple goals… creates sufficient economies of scale to lower energy costs through demand creation for critical energy B-4.2 B-4.3 B-4.4 PLACEHOLDER IMAGE DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE 29STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE generation and transmission assets, thereby increasing affordability, reliability, energy security, and grid resilience that reduce the cost of energy through displacement of higher cost fuel sources and by creating new energy demand. These market initiatives also create family-wage-sustaining jobs in Alaska. Benefits:The proposed market initiatives create multiple economic and societal benefits while providing Alaskans lower cost energy. Implementation Timeline: The Alaska Market Initiative Action Items have a range of planning, development, financing, implementation, and operation implementation timelines extending from the immediate to the long-term horizon for Alaska’s Energy Plan. Expected Results: Strategically planned market initiative actions with tactical implementation focused on fully utilizing generation and transmission current and future assets will optimize State Alaska’s Energy plan to lower Alaskans’ energy costs (electric, heating, transportation). B-4.5 Identify, assist, and fund Battery Energy Storage Systems (BESS) and other Energy Storage Systems (ESS) for successful integration into Coastal communities to increase energy security, grid resilience and to lower energy costs. ACTIONS (CONT.)PLACEHOLDER IMAGE DRAFT PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE 30 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVEDRAFT 31 PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE Section IV. Energy PrioritiesDRAFT DELIBERATIVE INTRODUCTIONThe vast majority of Alaska’s rural communities have significantly higher cost of energy than more urbanized areas. This is primarily due to remote village locations having to rely on diesel powered generators supplying power for individual villages. The cost to purchase, transport and store diesel fuel drives these higher energy generation costs. The Rural Subcommittee identified five strategies target opportunities to help lower the cost of energy generation in rural Alaska. Increased access to capital and infrastructure investments by the state and federal government are two of these strategies. Lowering operational costs of existing energy generation also provide actions to pursue. The previous three strategies can be supported by increasing economies of scale, either by connecting communities or attracting industrial partners to increase demand, and better decision making concerning energy generation, storage, distribution based on access to better data is the final rural subcommittee strategy. Alaska’s rural residents deserve access to clean, affordable, lower cost energy; these strategies are aimed to move the state in this direction. PLANNING PROCESS HIGHLIGHTS PLACEHOLDER FOR INFOGRAPHICS THAT DESCRIBE PUBLIC MEETINGS AND PARTICAPTION THAT HELPED IDENIFY ACTIONS AND STRATEGIES PRESENTED IN THIS SECTION STRATEGIES: C-1 Increase Capital Availability Infrastructure Investment Lower Operational Costs Improve Economies of Scale Improve Data-Driven Decision Making C-2 C-3 C-4 C-5DRAFT 32 PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Identify a Funding or Financing Mechanism for Rural Communities including a “Local Match” for Federal Grants. Identify opportunities for Public Private Partnerships to finance/fund energy infrastructure projects in rural Alaska. State of Alaska commit to sufficient capital budget funding for energy projects in rural Alaska. C-1.1 C-1.2 C-1.3 ACTIONS STRATEGY C-1: Increase Capital Availability Purpose:Increase access to capital to provide additional funding/finance for project and infrastructure construction. Background:Small communities and developing regions to not have the economy required to generate the capital needed to build energy projects – e.g. hydro, SMR, transmission infrastructure Benefits:Alaskans need to reduce the cost and increase access to reliable energy in rural Alaska. Expected Results:Sufficient investment in energy projects/infrastructure to reduce the cost of energy in rural Alaska.PLACEHOLDER IMAGE DRAFT 33 PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Promote a regional planning approach to connected energy, transportation, and broadband infrastructure. Identify gaps by leveraging studies done by regional ANC corporations, Economic Development Districts, Denali Commission, and other organizations as well as state and federal agencies. Replace or appropriately displace community-focused aging infrastructure in rural communities of Alaska. IInvest in pilot projects using appropriate technologies that demonstrate a regional approach to supplying affordable and reliable power to multiple communities. C-2.1 C-2.2 C-2.3 ACTIONS STRATEGY C-2: Infrastructure Investment C-2.4 Purpose:Support existing infrastructure and add new infrastructure to provide Alaskans with reliable energy at reduced cost. Background:Replace aging and inefficient infrastructure to improve reliability and affordability. Invest in new infrastructure related to the production and transmittal of power to rural Alaska in conjunction with transportation and broadband infrastructure. Benefits:Make regionally connected infrastructure investments that improve reliability and affordability in rural Alaska. Expected Results: Investment in connected regional infrastructure for the community needs that lead to the most affordable and reliable energy which would in turn improve public health, welfare, and socio-economic conditions in rural Alaska.PLACEHOLDER IMAGE DRAFT 34 PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE C-2.5 C-2.6 C-2.7 ACTIONS (CONT.) Fund and Construct Opportunities to Connect Rural Communities through Transmission Lines and Other Shared Energy Projects. Invest in critical repairs and resilient infrastructure that may be at high risk to current and future natural hazards (wildfire, extreme cold, storms, etc.), to avoid energy disruptions and preserve continuity of operations. Invest in expanding the grid in rural areas. Evaluate micronuclear and other emerging/ underutilized technologies throughout the State of Alaska. C-2.8 PLACEHOLDER IMAGE DRAFT 35 PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Expand and Inventory technical assistance, training and workforce development to identify gaps, increase capability & capacity building activities for Training a Rural Energy Workforce. i.e. apprenticeship programs for energy production Identify Innovation in Logistics Transportation to Improve Supply Chain Reliability. Create and implement a community outreach and education program to combat NIMBYism in energy projects in rural areas. Grid modernization and automation C-3.1 C-3.2 C-3.3 ACTIONS STRATEGY C-3: Lower Operational Costs Purpose:Lower operational costs of power/electricity in rural Alaskan villages. Background:There is a need to lower operational costs to produce energy in rural Alaska. This can be done by increasing technical assistance in rural communities; lower maintenance costs; improve work force development opportunities for rural community residents; improve or develop transportation infrastructure beyond upgrading rural airports. Connecting rural communities to existing transmission/electric grids may be another option to lower operational costs. Benefits:Reduce the cost and increase access to reliable energy in rural Alaska. Expected Results:PLACEHOLDER IMAGE C-3.4DRAFT 36 PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Identify Economies of Scope/Scale to Provide Multi-Benefit Utility Projects. Identify Energy Anchor Tenants to Provide Economy of Scale for Rural Communities. Identify a Funding or Financing Mechanism for Rural Communities including a “Local Match” for Federal Grants. Identify and complete a regional pilot project to demonstrate economies of scale. Invest in rural beneficial electrification. C-4.1 C-4.2 C-4.3 ACTIONS STRATEGY C-4: Improve Economies of Scale Purpose:Reduce the cost of power and Improve reliability Background:By increasing the sale of power against fixed cost we can reduce the price per KWH. Benefits:Adequate access to reliable energy at lower cost to improve public health and welfare. Grow rural economies. Expected Results:Connect communities to each other and anchor tenants to improve the reliability and reduce the cost of energy which would in turn support public health and welfare and grow rural economies. C-4.4 C-4.5 PLACEHOLDER IMAGE DRAFT 37 PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Locate and catalog existing energy studies, and update and collect data necessary to make informed value decisions related to energy generation, distribution, transmission, and storage in rural Alaskan villages. Leverage critical local knowledge provided by residents in coordination with and complement ongoing and planned projects Explore and leverage existing and new data capture tools including artificial Intelligence tools to quickly analyze existing and new data collected in rural Alaska to provide potential energy solutions. C-5.1 C-5.2 C-5.3 ACTIONS STRATEGY C-5: Improve Data-Driven Decision Making Purpose:Improve access to relevant data necessary to make informed value decisions related to energy generation, distribution, transimission and storage in rural Alaskan villages. Background:Legacy data collection processes have resulted in limited or incomplete data concerning Alaska’s energy system, especially in rural Alaska. Current data analytic processes, provide an opportunity to improve baseline data access, processing, and archiving. There is no overarching data custodian within that state that collects, manages, and archives data necessary to plan, design and construct energy infrastructure in rural Alaska. This includes critical local knowledge provided by village residents. Benefits:Provide better economic outcomes, longterm cost/benefit analysis for rural Alaskan communities related to energy infrastructure. Expected Results:PLACEHOLDER IMAGE DRAFT PRIORITY D. STATE ENERGY DATA 38 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVEDRAFT PRIORITY D. STATE ENERGY DATA 39Section IV. Energy Priorities STRATEGIES: D-1 Establish a Data Department within the Alaska Energy Authority (AEA), using statute as necessary Establish an energy data governance committee that is responsible for setting minimum protocols for data collection, quality, storage, use, and access Fund data capacity Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation D-2 D-3 D-4 INTRODUCTIONThere are literally terabytes of energy data available in the State of Alaska. Currently this data is not centrally located or managed. The Data Subcommittee created a Technical Advisory committee to help them identify and clarify four strategies intended to help the state better collect, manage, and analyze energy data. Four strategies came from this effort. The first recommended Establishing a Data Department within the Alaska Energy Authority to oversee management of Alaska’s energy data. Second, Establish an energy data governance committee that is responsible for establishing minimum protocols for data collection, quality, storage, use, and access identifies the need for establishment of industry standard data governance protocols by an established data governance committee. The third strategy points to needed funding with the establishment of the above organizations, and the final strategy, Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation, focuses on validating and improving existing energy data, and collecting additional needed data to aid in future energy decision making. PLANNING PROCESS HIGHLIGHTS PLACEHOLDER FOR INFOGRAPHICS THAT DESCRIBE PUBLIC MEETINGS AND PARTICAPTION THAT HELPED IDENIFY ACTIONS AND STRATEGIES PRESENTED IN THIS SECTION DRAFT DELIBERATIVEDRAFT PRIORITY D. STATE ENERGY DATA 40 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities Institute or update statutory requirements for AEA Data Department. Fund, develop, and implement a technical and needs assessment. Fund, develop, and implement a capital asset plan. Develop and fund an operating and maintenance budget, to include the identification of potential funding sources and mechanisms. Appropriately staff the department based on the technical and needs assessment D-1.1 D-1.2 D-1.3 ACTIONS STRATEGY D-1: Establish a Data Department within the Alaska Energy Authority (AEA), using statute as necessary D-1.4 Purpose: To staff and properly equip a team dedicated to energy data management within the Alaska Energy Authority. Background:While a substantial amount of valuable energy data exists in aggregate, they are often inconsistent, inaccessible, and provided in formats which do not meet end-user needs. Existing data needs are thus being met by implementing unsustainable, short-term solutions such as adding additional responsibilities to existing staff, which often results in delays or needs going unmet. The Alaska Energy Authority is the state’s energy office and lead agency for statewide energy policy and program development. Benefits:This recommendation prioritizes, centralizes, and focuses the importance of energy data management in order to ensure the consistency and accessibility of energy data so it can better inform decision-making efforts on energy projects, program, and policy development. Housing a Data Department in AEA will ensure consistency and sustainability of state energy data management. Expected Results:The provision of consistent and accessible data further enabling data-informed decision-making on energy projects and policy across the state. Increased consistency of state data assets. D-1.5 PLACEHOLDER IMAGEDRAFT DELIBERATIVEDRAFT PRIORITY D. STATE ENERGY DATA 41STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy Priorities Form a technical advisory committee to draft recommendations on where the data governance committee should be established, supported, staffed, membership composition, scope of duties responsibilities, and other issues that may need to be addressed. Fund a long-term data governance strategy based on recommendations made by the Technical Advisory Committee. D-2.1 D-2.2 ACTIONS STRATEGY D-2: Establish an energy data governance committee that is responsible for setting minimum protocols for data collection, quality, storage, use, and access Purpose:Ensure that collection, quality, storage, use of, and access to electric, heat, and transportation energy data in Alaska meets industry standards, current protocols, and best practices. Background:Existing data can be inconsistent, inaccessible, and provided in formats which do not meet end-user needs. Security of, and ability to access, energy data are major concerns for public and private data users alike. The willingness to share, and the extent to which that data is shared, is significantly limited by concerns from such data providers regarding security, access, and usage. Benefits:Data-informed decision making is only as valid as the data on which the decision is based. The collection, quality, storage, use of, and access to energy data in Alaska should align with those industry best practices, standards, and current protocols so that all decisions are based on accurate and secure data. Expected Results:Energy data in Alaska meets and conforms with industry standards, protocols, and best practices. Increased participation of energy data stakeholders and end-users.PLACEHOLDER IMAGEDRAFT DELIBERATIVEDRAFT PRIORITY D. STATE ENERGY DATA 42 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities Establish dedicated data collection and analysis positions in state agencies that are responsible for collecting, analyzing, hosting, distributing data in formats that are accessible, and liaising with the AEA Data Department. Provide professional development and/ or skills training opportunities for staff and other agency partners as it relates to data collection and analysis. D-3.1 D-3.2 ACTIONS STRATEGY D-3: Fund data capacity Purpose: Establish dedicated data collection and analysis positions in state agencies that are responsible for collecting, analyzing, hosting, distributing data in formats that are accessible, and liaising with the AEA Data Department Background:MMany of the ongoing data-related efforts across State agencies are borne by individuals whose duties and responsibilities are not primarily data-focused. Benefits:Establishing positions within State agencies whose primary duties and responsibilities are focused on data-related activities/initiatives, using statutes as necessary. Expected Results:Increased collaboration, reduced duplication of efforts, ease of data access, and better-informed decision making.PLACEHOLDER IMAGEDRAFT DELIBERATIVEDRAFT PRIORITY D. STATE ENERGY DATA 43STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy Priorities Fund a gap analysis of energy data, including existing data, accessibility, quality, age, and what is and would be needed for data-informed decision making. Revitalize, fund, and maintain energy data platforms and services so as to ensure the long- term availability and accessibility of data. Conduct a data audit of the Regulatory Commission of Alaska (RCA) to include recommendations. Expand the Power Cost Equalization (PCE) report and the extent of such data reported. D-4.1 D-4.2 ACTIONS STRATEGY D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation Purpose:Fund a gap analysis of energy data, including existing data, accessibility, quality, age, and what form and character of data is and would be needed for data-informed decision making. Background:Existing data can be inconsistent, inaccessible, and provided in formats which do not meet end-user needs. Thermal and transportation datasets are found to be lacking. The term “Energy Data” has historically been limited to electricity data, meaning there are significant gaps in thermal and transportation energy data. Benefits:Expand the definition of “Energy Data” and those existing, to-be-compiled, and to-be-created underlying datasets to include thermal and transportation data to better capture the dynamic and interrelated nature of energy use in Alaska. Expected Results: More all-encompassing and informed decision-making for energy projects and policies in Alaska, across electric, heat, and transportation sectors. D-4.3 D-4.4PLACEHOLDER IMAGEDRAFT DELIBERATIVEDRAFT PRIORITY D. STATE ENERGY DATA 44 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities Expand the definition of “energy data” by adopting the TAC definition, ensuring the definition is inclusive of heat/thermal and transportation fuel data. Understand how heating and transportation fuel is delivered and used. Re-establish annual updates to the Alaska Energy Statistics report. D-4.6 D-4.7 ACTIONS (CONT.)PLACEHOLDER IMAGEPLACEHOLDERCALL OUT BOXD-4.5 DRAFT DELIBERATIVEDRAFT PLACEHOLDER IMAGE45STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVEDRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 46 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVEDRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 47Section IV. Energy PrioritiesDRAFT DELIBERATIVE STRATEGIES: E-1 Strengthen state-federal coordination and investment Decrease barriers to private sector investments Maintain residential subsidy focused on equity, while reducing need across communities Improve the economics of project development Evaluate and implement State policy, tax, and other incentives Increase State programmatic investments Respond to and implement evolving energy business models E-2 E-3 E-4 INTRODUCTIONThe Incentives and Subsidies subcommittee settled on three themes and created seven strategies to support securing affordable energy in Alaska. The first theme relates to strategies and actions that incentivize private sector investment. These strategies include Decrease Barriers to Private Sector Investment, Improve Economies of Project Development, and Respond to and implement evolving Energy Business Models. The second theme is oriented to state and federal policy and law that could be modified to support and accelerate investment in energy generation, transmission, and storage in Alaska. These strategies include Strengthen State-Federal Coordination and Investment, Evaluate and implement State policy, tax, and other incentives, and Increase State programmatic investments. Finally, the Incentives subcommittee acknowledges the need to continue existing subsidies offered by the state while some of the previous strategies are implemented. The final theme and strategy includes, Maintaining Residential subsidy focused on equity, while reducing the need across communities. PLANNING PROCESS HIGHLIGHTS PLACEHOLDER FOR INFOGRAPHICS THAT DESCRIBE PUBLIC MEETINGS AND PARTICAPTION THAT HELPED IDENIFY ACTIONS AND STRATEGIES PRESENTED IN THIS SECTION E-5 E-6 E-7DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 48 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Develop a funding and implementation toolkit for state/federal energy projects. Establish a clean energy and transmission line land use designation on state and federal lands. Establish a state and/ or federal Alaska Clean Energy and Transmission Line Fund or an Alaska Energy Transition Fund. Ensure that criteria for state and federal project investments are weighted toward affordability goals, among other priorities. Implement a state/ federal private sector investment energy coordinator (POC). Utilize DOE LPO Title 17 Clean Energy Financing Program and/or Tribal Energy Loan Guarantee Program. E-1.1 E-1.2 E-1.3 ACTIONS STRATEGY E-1: Strengthen state-federal coordination and investment E-1.4 E-1.5 Purpose:The AESTF recommends the establishment of a state/federal working group that identifies and works toward improved access on federal lands, funding in place to accelerate an affordable energy transition, and the ability to leverage investment opportunities between state and federal programs. Background:The State of Alaska has the highest disparity of power costs from one community or region to another. Some of America’s highest-cost energy communities have significant barriers in the form of federal lands, which comprise more than 60% of the state. Federal land use policy comes with significant hurdles and a limited ability to effect widespread access or change. A coordinated and targeted effort by state and federal agencies that focuses on improving access and removing barriers is critical to lowering the cost of energy in Alaska, even as it increases the potential to meet federal clean energy goals. Benefits:The increased capacity of the state to negotiate and execute priorities with willing federal agencies for developing cost-effective clean energy, transmission lines on federal lands, with dedicated funding in place to bring Alaska parity with the rest of the nation, will lower energy costs for Alaskans while assisting federal agencies in meeting national clean energy goals. This process will increase knowledge of available funding and implementation support for energy projects in Alaska. This action aligns with and should leverage current federal investment through IIJA and IRA. Expected Results:This process will increase knowledge of available funding and implementation support for energy projects in Alaska. This action aligns with and should leverage current federal investment through IIJA and IRA. E-1.6 PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 49STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Improve and further implement Commercial Property Assessed Clean Energy and Resilience (C-PACER) programs and evaluate the future adoption of an R-PACER program. Establish a standard integration tariff and reduction of interconnection and/or wheeling tariffs. Adopt a Renewable Portfolio Standard (RPS) followed by a Renewable Energy Credit (REC). Implement low- interest loan program (concessionary capital, like Power Project Loan Fund) that facilitates affordable energy development and infrastructure improvements. E-2.1 E-2.2 E-2.3 ACTIONS STRATEGY E-2: Decrease barriers to private sector investments E-2.4 Purpose:The AESTF recommends a strategic approach to policy and program development that stimulates and incentivizes private sector activity, including to make investments alongside private sector partners that result in coordinated and more efficient project delivery. Background:Federal and state investment is insufficient to address the scale necessary to effect widespread and meaningful transition toward lower-cost and –carbon energy. At the same time, removing barriers or reducing the burdens associated with private sector investments has the potential to increase Alaska’s ability to establish partnerships, and leverage private capital in the public interest. Benefits:Initiating a series of statutory changes and encouraging quicker adoption by communities and use by utilities and others will unlock private sector investment. Offsetting upfront costs and increasing the utilization of low-interest public capital will strengthen project economics while including strong public benefit criteria. Finally, this process envisions increasing the overall economy of scale, which will contribute to reducing barriers. Expected Results:PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 50 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Conduct pre- development permitting, surveying, engineering, and/or environmental within principal energy zones. Anticipate and plan for strategic demand increases, or pooled asset investments, including through project bundling and beneficial electrification. E-2.1 E-2.6 ACTIONS (CONT.)PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 51STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Ensure that PCE funds are available at the right scale over the correct time period. Implement a strategic approach to lowering costs according to highest use communities. Consider the development of a postage stamp rate alternative, where all Alaskans pay the same rate. Increase the use of community facilities allocation to lower State, Tribal, and local governments costs. Identify ways in which PCE can lower the cost of doing business, by evaluating residential costs beyond energy as part of the overall household burden. E-3.1 E-3.2 E-3.3 ACTIONS STRATEGY E-3: Maintain residential subsidy focused on equity, while reducing need across communities E-3.4 E-3.5 Purpose:The AESTF recommends the continued commitment by the State to ensuring residents have access to subsidy where and for as long as lower costs are not achieved, even as the State actively works to 1) consider alternative mechanisms for a fairer subsidy, 2) strategically deploys PCE funds to advance low-cost energy solution, and 3) expands the ability of PCE to lower costs across sectors within communities. Background:The value of PCE cannot be overstated – it has proven to be a lifeline to Alaskans who bear the brunt of high costs. This equitable distribution of State funding, relative to and based on project investment in some parts of the state, has lowered costs in communities where otherwise more residents may have chosen outmigration. However, PCE has not equalized costs in any way, and it remains true that this high-cost burden falls on some Alaskans and not others. At the same time, the overall goals of the state can encompass reducing the need for this subsidy by actually lowering costs in communities. Benefits: Working toward a flatter rate across Alaska improves the mobility of residents, increased economic opportunity, and overall improved quality of life for Alaskans. Expected Results:PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 52 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Ensure ability to offset debt that results in lower cost energy project development. Implement community- based IPPs that sell power to utility for PCE reimbursement. E-3.6 E-3.7 ACTIONS (CONT.)PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 53STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Establish a liability Trust for utilities, capitalized by the State with pooled contributions to protect against risk of wildfires or other impacts. Utilize FERC-defined open access on all State-owned/subsidized and RCA regulated utility transmission lines. Establish a green bank for financing of community scale energy efficiency projects. Ensure adequate workforce training and skills development alongside job creation goals of State. Ensuring efficiency of sunk costs and investments, while implementing financial tools (arbitrage, bonds, etc.) that facilitate decommissioning high- cost utilities and aging plant securitization E-4.1 E-4.2 E-4.3 ACTIONS STRATEGY E-4: Improve the economics of project development E-4.4 E-4.5 Purpose:The AESTF recommends a multi-pronged approach to reducing risk to utilities and project proponents, increasing the availability of financing mechanisms, and encouraging ancillary investments that will benefit the industry and economies of communities. Background:Alaska will always be a high-cost state, defined by the tyranny of geography, time, and distance. Access to markets, and at the tail-end of a global supply chain, there are clear competitive disadvantages within which utilities and project developers operate, even as ratepayers (or the State) bear the cost. There are ways, however, to lower the costs of project development, and state action can facilitate this. Benefits: Affordability rests on capex and opex, and both have avoidable and unavoidable layered costs. A strategic state approach can begin peeling away or mitigating avoidable costs to improve the economics of project development, and ultimately save ratepayers money. Expected Results:PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 54 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Implement pooling of RECs for system optimization and improving economy of scale. Reevaluate the role of anchor institutions and develop new models for economies of scale, such as through beneficial electrification. E-4.6 E-4.7 ACTIONS (CONT.)PLACEHOLDER GRAPHICDRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 55STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Conduct an energy incentives program study to determine capacity of State to make investments. Finalize and implement a statewide energy plan and policy, consistent with Task Force goals. Evaluate, track, and benchmark all State energy- related expenses for maximizing impact. Ensure availability of resources for investment, or the ability to forego revenue as part of incentive program. Implement State income tax exemption or credit on revenue produced from private investment in new generation and transmission. E-5.1 E-5.2 E-5.3 ACTIONS STRATEGY E-5: Evaluate and implement State policy, tax, and other incentives E-5.4 E-5.5 Purpose:The AESTF recommends an audit of all State energy-related expenditures to assess impact, identify gaps, and maximize the benefits of future effort, even as it further identifies available and necessary funding to address other actions of the AESTF. Background:Ultimately, what the State has most control of is its own policy, regulatory, and tax systems. The State’s capacity to contribute to lowering the cost of energy for Alaskans is immense, and intensity of effort is required to fully assess current activity and the potential need for new laws and practices that will incentivize change. Benefits: The majority of actions identified by the AESTF rest on the State’s ability to adopt statutory or regulatory changes or make necessary investments. Expected Results:PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 56 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Reevaluate current mandatory municipal exemptions to encourage increased adoption of local exemptions that align with updated goals to attract private investment. E-5.6 ACTIONS (CONT.)PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 57STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Increase the capacity for and streamlining of regulatory and permitting action within state agencies and at the federal level. Strengthen the ability of the State and utilities to address the maintenance and operation needs of Alaska power systems. Increase availability of resources for weatherization, energy efficiency, and building retrofits Ensure adequacy of staff resources at local and state level, including to provide technical assistance. Evaluate State and local procurement policies that align with affordable and clean energy adoption. E-6.1 E-6.2 E-6.3 ACTIONS STRATEGY E-6: Increase State programmatic investments E-6.4 E-6.5 Purpose:The AESTF recommends the evaluation of and changes to current programmatic investments such that 1) these programs have sufficient capacity and competency to act effectively in support of lowering energy costs in Alaska, and 2) that the braiding of programmatic intent results in streamlining action and reducing capex and opex costs. Background:Government programs may be developed to provide technical assistance or to serve as a resource to consumers, project proponents, and others. Program staff provide support and guidance as to how to utilize these tools. Programs may also try to provide direct services, such as improving energy efficiency, weatherization, community planning, or rate review and setting. Some programs are simply there to ensure compliance. Governments may spend significant resources on these programs. It is not clear that programs reduce the cost of energy, though they may have other benefits. Benefits: The ability of the state to achieve a moonshot goal requires a coordinated effort across agencies and through all programs that intersect with the goal. The state can consider every program through the lens of lowering energy costs for Alaskans, and refine its approaches to achieve that end. Expected Results:PLACEHOLDER IMAGE DRAFT PRIORITY E. INCENTIVES AND SUBSIDIES 58 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Increase the use of energy technology demonstration and deployment programs. Implement emerging tools like on-bill financing, net metering, etc. Mirror FERC safe harbor rule allowing for backfeeding of up to 15% of circuit capacity. Identify baseline and establish target for T&D capacity utilization of 90%. Explore locational marginal pricing (LMP). Implement utility rate incentives for time-of- use rates during periods of lower cost power. Consider Alaska version of FERC Order 2222 to open wholesale markets to broader participation by aggregators of customer resources. E-7.1 E-7.2 E-7.3 ACTIONS STRATEGY E-7: Respond to and implement evolving energy business models E-7.4 E-7.5 Purpose:The AESTF recommends the cost-benefit analysis of multiple tools that should lead to greater private sector investment and lower costs for ratepayers, and the development of an implementation strategy. Background:The pace and scale of change occurring globally and nationally has the potential to lower costs in Alaska, to the extent the state can incorporate new models of doing business. While not all tools may be as applicable here as elsewhere, it is worth investing time in increasing the suite of options that the state has at its disposal. In particular, these business models affect utility, ratepayer, and independent power producer relationships, even as they have the potential to lower costs for Alaskans. Benefits:Conventional tools have been used during a period of Alaska’s energy system development that was responsive to certain conditions and available resources that are now evolving, even as high costs have plagued the majority of Alaska communities. As part of a strategic pathway toward lower cost energy, the state’s investment in new business models and innovative tools that complement and build on current systems will be critical to Alaska’s future. Expected Results: E-7.6 E-7.7 PLACEHOLDER IMAGE DRAFT PLACEHOLDER IMAGE DRAFT PRIORITY F. STATUTES AND REGULATIONS DRAFT PRIORITY F. STATUTES AND REGULATIONS 61Section IV. Energy PrioritiesDRAFT DELIBERATIVE INTRODUCTIONThe Statutes and Regulations Subcommittee understands nearly all of the recommended actions from the other five subcommittees will require some form of statutory or regulatory modification or update. We are taking the approach of reviewing these recommended actions and consolidating those that are comparable or alike. We will then craft prioritized actions for the administration to progress forward in the coming legislative session as either new legislation or updates to existing draft legislation or recommended regulatory changes to the Alaska Administrative Code. STRATEGIES: F-1 F-2 F-3 PLANNING PROCESS HIGHLIGHTS PLACEHOLDER FOR INFOGRAPHICS THAT DESCRIBE PUBLIC MEETINGS AND PARTICAPTION THAT HELPED IDENIFY ACTIONS AND STRATEGIES PRESENTED IN THIS SECTION PLACEHOLDER STRATEGIES TO BE DETERMINED AFTER REVIEWING OTHER COMMITTEE STRATEGIES DRAFT PRIORITY F. STATUTES AND REGULATIONS 62 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Restructure the RCA with 3 commissioners and administrative law judges to streamline/ handle rate cases. Example states include: Iowa, Virginia, etc. Streamline permitting for energy projects Establish state funding to help with local match for federal grant cost share Continue to allow transmission and distribution lines to share DOT right-of-way. Evaluate similar states (such as Wyoming, North Dakota, etc.) for case studies and best practices regarding energy distribution, transmissions, and connectivity. Provide budgetary support for the Regulatory Commission of Alaska (RCA). F-1.1 F-1.2 F-1.3 ACTIONS STRATEGY F-1: Placeholder Strategy To Be Determined F-1.4 F-1.5 Purpose: Background: Benefits: Expected Results: F-1.6 PLACEHOLDER IMAGE DRAFT PRIORITY F. STATUTES AND REGULATIONS 63STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE Policies Currently Under Consideration APA Policy Position (For Consideration): • Clarify statute on wildfire liability • Prioritize state investment in electric infrastructure and leverage federal funding opportunities • Support reasonable and economic carbon reduction strategies that consider costs to consumers • Preserve Power Cost Equalization Endowment, using the Endowment only for its statutory purposes, ensuring all eligible communities can maximize the PCE program, and full funding the PCE program in FY 2023 • Alternative Uses for Coal Regulations CEDS Action (For Consideration) • Carbon and Sequestration Regulations • Hydrogen Roadmap and Regulations • Establish Alaska Hydrogen Hub DRAFT PRIORITY F. STATUTES AND REGULATIONS 64 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Crosswalk Table of Actions from other committees that have a relationship with multiple subcommittees, including Statutes and Regulations, that need further review Priority Strategy Action #Action Priority A. Railbelt Transmission, Generation, and Storage Priority B. Coastal Generation, Distribution, and Storage Priority C. Rural Generation, Distribution, and Storage Priority D. State Energy Data Priority E. Incentives and Subsidies Priority F. Statues and Regulations Priority A. Railbelt Transmission, Generation, and Storage Strategy A-2 Action A-2.2 Modify existing statute(s) requiring the commission to consider long term diversification goals when approving additional/new Railbelt power generation.✓✓ Priority A. Railbelt Transmission, Generation, and Storage Strategy A-2 Action A-2.3 Progress Known Energy Generation Diversification Projects to Go/No-Go Decision• Dixon Diversion• Susitna-Watana• AKLNG ✓✓ Priority A. Railbelt Transmission, Generation, and Storage Strategy A-2 Action A-2.1 Adopt a Clean Energy Standard with incentives to facilitate reaching di-versification goals.✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-1 Action B-1.1 Establish, require, assist, and Implement community Integrated Re-source Plans (light) to forecast energy demand and generation for community and regional future energy needs and to lower energy costs. ✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-1 Action B-1.2 Strengthen Alaska’s Net Metering energy framework, tariffs, and regu-lations for Alaska’s diverse stakeholders to promote net metering re-newable energy investments.✓✓✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-1 Action B-1.3 Strengthen and Streamline the State of Alaska’s internal state regulato-ry and land use administrative processes to accelerate approval to ad-vance strategic energy projects and transmission for regional energy security and lower energy costs. ✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-1 Action B-1.4 Strategize and Prioritize State of Alaska funding to match federal fund-ing and federal financing to build and expand Transmission and Distribu-tion lines in Alaska to bring Alaska on par with the US transmission sys-tems for Alaskan energy security and lower energy costs. ✓✓✓✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-1 Action C-1.6 Recruit, Train, and Enhance Alaska workforce with technical skills and training for advancing beneficial electrification to lower Alaska energy costs and to sustain Alaska’s growing energy infrastructure. ✓✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-2 Action B-2.1 Establish an Alaska/ federal Renewable Energy Policy Force to develop, collaborate, and prioritize State energy, plan, goals, and rights to opti-mally advance renewable energy and transmission on federal lands. ✓✓✓✓DRAFT PRIORITY F. STATUTES AND REGULATIONS 65STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE PriorityStrategyAction #Action Priority A. Railbelt Transmission, Generation, and Storage Priority B. Coastal Generation, Distribution, and Storage Priority C. Rural Generation, Distribution, and Storage Priority D. State Energy Data Priority E. Incentives and Subsidies Priority F. Statues and Regulations Priority A. Railbelt Transmission, Generation, and StorageStrategy A-2Action A-2.2Modify existing statute(s) requiring the commission to consider long term diversification goals when approving additional/new Railbelt power generation.✓✓ Priority A. Railbelt Transmission, Generation, and StorageStrategy A-2Action A-2.3 Progress Known Energy Generation Diversification Projects to Go/No-Go Decision• Dixon Diversion• Susitna-Watana• AKLNG ✓✓ Priority A. Railbelt Transmission, Generation, and StorageStrategy A-2Action A-2.1Adopt a Clean Energy Standard with incentives to facilitate reaching di-versification goals.✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-1Action B-1.1 Establish, require, assist, and Implement community Integrated Re-source Plans (light) to forecast energy demand and generation for community and regional future energy needs and to lower energy costs. ✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-1Action B-1.2Strengthen Alaska’s Net Metering energy framework, tariffs, and regu-lations for Alaska’s diverse stakeholders to promote net metering re-newable energy investments.✓✓✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-1Action B-1.3 Strengthen and Streamline the State of Alaska’s internal state regulato-ry and land use administrative processes to accelerate approval to ad-vance strategic energy projects and transmission for regional energy security and lower energy costs. ✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-1Action B-1.4 Strategize and Prioritize State of Alaska funding to match federal fund-ing and federal financing to build and expand Transmission and Distribu-tion lines in Alaska to bring Alaska on par with the US transmission sys-tems for Alaskan energy security and lower energy costs. ✓✓✓✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-1Action C-1.6 Recruit, Train, and Enhance Alaska workforce with technical skills and training for advancing beneficial electrification to lower Alaska energy costs and to sustain Alaska’s growing energy infrastructure. ✓✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-2Action B-2.1 Establish an Alaska/ federal Renewable Energy Policy Force to develop, collaborate, and prioritize State energy, plan, goals, and rights to opti-mally advance renewable energy and transmission on federal lands. ✓✓✓✓DRAFT PRIORITY F. STATUTES AND REGULATIONS 66 STATE OF ALASKA STATEWIDE ENERGY MASTER PLANSection IV. Energy Priorities DRAFT DELIBERATIVE Crosswalk Table of Actions from other committees that have a relationship with multiple subcommittees, including Statutes and Regulations, that need further review Priority Strategy Action #Action Priority A. Railbelt Transmission, Generation, and Storage Priority B. Coastal Generation, Distribution, and Storage Priority C. Rural Generation, Distribution, and Storage Priority D. State Energy Data Priority E. Incentives and Subsidies Priority F. Statues and Regulations Priority B. Coastal Generation, Distribution, and Storage Strategy B-2 Action B-2.2 State of Alaska partners and collaborates with Federally recognized Alaska tribes and federal agencies to develop mutually beneficial Energy Development and Transmission/Distribution to advance the State Energy Plan to lower the cost of energy. ✓✓✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-3 Action B-3.1 Foster, Support, and Assist Hydropower development and their trans-mission in Alaska to lower energy costs, provide energy security, and spur economic growth, job creation, and prosperity for Alaska. ✓✓✓ Priority B. Coastal Generation, Distribution, and Storage Strategy B-4 Action B-4.2 Plan, finance, and support the execution of Shore power at Public and Private Cruise Docks to Sell Excess Energy to Cruise Ships.✓✓ Priority C. Rural Generation, Distribution, and Storage Strategy C-1 Action C-1.1 Identify a Funding or Financing Mechanism for Rural Communities in-cluding a “Local Match” for Federal Grants.✓✓ Priority E. Incentives and Subsidies Strategy C-3 Action C-3.1 Expand and Inventory technical assistance, training and workforce development to identify gaps, increase capability & capacity building activi-ties for Training a Rural Energy Workforce. i.e. apprenticeship programs for energy production. ✓✓✓ Priority E. Incentives and Subsidies Strategy E-1 Action E-1.2 Establish a clean energy and transmission line land use designation on state and federal lands.✓✓ Priority E. Incentives and Subsidies Strategy E-1 Action E-1.3 Establish a state and/or federal Alaska Clean Energy and Transmission Line Fund or an Alaska Energy Transition Fund.✓✓ Priority E. Incentives and Subsidies Strategy E-4 Action E-4.4 Ensure adequate workforce training and skills development alongside job creation goals of State.✓✓DRAFT PRIORITY F. STATUTES AND REGULATIONS 67STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN Section IV. Energy PrioritiesDRAFT DELIBERATIVE PriorityStrategyAction #Action Priority A. Railbelt Transmission, Generation, and Storage Priority B. Coastal Generation, Distribution, and Storage Priority C. Rural Generation, Distribution, and Storage Priority D. State Energy Data Priority E. Incentives and Subsidies Priority F. Statues and Regulations Priority B. Coastal Generation, Distribution, and StorageStrategy B-2Action B-2.2 State of Alaska partners and collaborates with Federally recognized Alaska tribes and federal agencies to develop mutually beneficial Energy Development and Transmission/Distribution to advance the State Energy Plan to lower the cost of energy. ✓✓✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-3Action B-3.1 Foster, Support, and Assist Hydropower development and their trans-mission in Alaska to lower energy costs, provide energy security, and spur economic growth, job creation, and prosperity for Alaska. ✓✓✓ Priority B. Coastal Generation, Distribution, and StorageStrategy B-4Action B-4.2Plan, finance, and support the execution of Shore power at Public and Private Cruise Docks to Sell Excess Energy to Cruise Ships.✓✓ Priority C. Rural Generation, Distribution, and Storage Strategy C-1Action C-1.1Identify a Funding or Financing Mechanism for Rural Communities in-cluding a “Local Match” for Federal Grants.✓✓ Priority E. Incentives and SubsidiesStrategy C-3Action C-3.1 Expand and Inventory technical assistance, training and workforce development to identify gaps, increase capability & capacity building activi-ties for Training a Rural Energy Workforce. i.e. apprenticeship programs for energy production. ✓✓✓ Priority E. Incentives and SubsidiesStrategy E-1Action E-1.2Establish a clean energy and transmission line land use designation on state and federal lands.✓✓ Priority E. Incentives and SubsidiesStrategy E-1Action E-1.3Establish a state and/or federal Alaska Clean Energy and Transmission Line Fund or an Alaska Energy Transition Fund.✓✓ Priority E. Incentives and SubsidiesStrategy E-4Action E-4.4Ensure adequate workforce training and skills development alongside job creation goals of State.✓✓DRAFT APPENDIX II. ACTION TRACKING SHEET STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time.DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Strategy A-1: Unify Transmission Action A-1.1 Unify and convey all existing transmission assets along the Railbelt and Bradley Lake to AEA for new non-for-profit regulated utility for the net book value. Short (2 - 5 years)AEA Legislature; Dept of Revenue; Dept of Law; Railbelt Utilities New Strategy A-2: Diversify Generation Action A-2.1 Adopt a Clean Energy Standard with incentives to facilitate reaching diversification goals To ensure strong commitment and action to electricity generation diversification the Railbelt Subcommittee recommends the State adopt a Clean Energy Standard with incentives for new generation projects and for utilities when diversification goals are reached. The Railbelt Subcommittee recommends providing incentives for generation diversification rather than penalties to drive the right behaviors, action and outcomes for our State. 1. Direct Payment to Utilities for Achieving Diversification Targets 2. Augmentation of the Renewable Energy Fund (REF): 3. Augmentation of the Power Project Fund (PPF) Strategy A-2: Diversify Generation Action A-2.2 Modify existing statute(s) requiring the commission to consider long term diversification goals when approving additional/new Railbelt power generation. Strategy A-2: Diversify Generation Action A-2.3 Progress Known Energy Generation Diversification Projects to Go/No- Go Decision • Dixon Diversion • Susitna-Watana • AKLNG Strategy A-3: Increase Demand Action A-3.1 Issuing an RFP to industry for a large load that would be provided at a guaranteed low energy price (the energy price could be tiered based on amount of load growth). Priority A. Railbelt Transmission, Generation, and Storage - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Priority A. Railbelt Transmission, Generation, and Storage State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 1DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Strategy B-1: Alaska Policy Recommendatio ns Action B-1.1 Establish, require, assist, and Implement community Integrated Resource Plans (light)to forecast energy demand and generation for community and regional future energy needs and to lower energy costs. Identify future generation and demand for resource planning purposes to lower the energy cost for the communities and region. Establish Standardized Metrics Related to Power Generation Compared to Future Demand.Immediate (0 - 2 years) AEA RCA; Utilities; DCCED; communities; tribal entities; New Strategy B-1: Alaska Policy Recommendatio ns Action B-1.2 Strengthen Alaska’s Net Metering energy framework, tariffs, and regulations for Alaska’s diverse stakeholders to promote net metering renewable energy investments.Short (2 - 5 years) Tribes and native corporations; schools; Utilities; DCCED; AEA; RCA; Legislature New Strategy B-1: Alaska Policy Recommendatio ns Action B-1.3 Strengthen and Streamline the State of Alaska's internal state regulatory and land use administrative processes to accelerate approval to advance strategic energy projects and transmission for regional energy security and lower energy costs. Identify burdensome regulatory requirements at State Departments, with focus on hydro-electric power and other renewable energy development. Collaborate with appropriate state and regulatory agencies to promote solutions to streamline approvals, decrease costs, and expedite schedules. Immediate and short term Office of Governor, AEA Office of Project Management and Permitting (OPMP), DNR; DOT&PF; DEC; DFG; Dept of Law, New Strategy B-1: Alaska Policy Recommendatio ns Action B-1.4 Strategize and Prioritize State of Alaska funding to match federal funding and federal financing to build and expand Transmission and Distribution lines in Alaska to bring Alaska on par with the US transmission systems for Alaskan energy security and lower energy costs. Identify funding/financing sources a the federal, state and local level to expand transmission lines across Alaska. Prioritize innovative construction and product types, such as submarine transmission and underground transmission. Spectrum of timeframes based on local needs and initiatives Governors Office, AEA Congressional Delegation. Utilities; DCCED; AEA, AIDEA; local governments; tribal; state legislature; Governor's office New Strategy B-1: Alaska Policy Recommendatio ns Action B-1.5 Establish and provide valuable energy planning and modeling metrics from State data sources, where available and requested (such as DMV electric vehicle registrations and Air Source Heat Pump (ASHP) installation) by individual communities. Strategy B-1: Alaska Policy Recommendatio ns Action B-1.6 Recruit, Train, and Enhance Alaska workforce with technical skills and training for advancing beneficial electrification to lower Alaska energy costs and to sustain Alaska's growing energy infrastructure. Establish a workforce development program to educate, train, and retain skilled workers in electrification. Immediate (0 - 2 years) Dept. of Labor DOR, DCCED, University of Alaska, Labor Unions, AVTEC, Tribal Training Programs - (Tlingit Tribal Central Council), Yuut Elitnaurviat New Strategy B-2: State of Alaska Coordination with Federal Agencies and Federally Recognized Tribes Recommendatio ns Action B-2.1 Establish an Alaska/federal Renewable Energy Policy Force to develop, collaborate, and prioritize State energy, plan, goals, and rights to optimally advance renewable energy and transmission on federal lands. Priority B. Coastal Generation, Distribution, and Storage - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Priority B. Coastal Generation, Distribution, and Storage State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 1DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority B. Coastal Generation, Distribution, and Storage - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy B-2: State of Alaska Coordination with Federal Agencies and Federally Recognized Tribes Recommendatio ns Action B-2.2 State of Alaska partners and collaborates with Federally recognized Alaska tribes and federal agencies to develop mutually beneficial Energy Development and Transmission/Distribution to advance the State Energy Plan to lower the cost of energy. Coordinate and collaborate with federal land holding agencies to establish a renewable energy land use and Transmission use corridor Primacy on federal land allow Alaska renewable energy development on federal lands. Immediate, short term ongoing Governors Office, AEA Governors Office, AEA, DCCED; Legislature; DOT&PF; Dept of Law; Alaska Congressional Delegation, Denali Commission, Alaska Power Association New Strategy B-3: Alaska Hydropower Generation Recommendatio ns Action B-3.1 Foster, Support, and Assist Hydropower development and their transmission in Alaska to lower energy costs, provide energy security, and spur economic growth, job creation, and prosperity for Alaska. Build Execution ready Hydro Projects, Advance economically viable Hydro for energy security, spur economic growth and prosperity for Alaska. Immediate-Execution Ready, Short (2 - 5 years) [licensed] Long-term (10 years plus) [unlicensed]AEA AIDEA, Federal funding, DCCED, DOL, DNR, ADF&G, state legislature New Strategy B-4: Alaska Market Initiatives Action B-4.1 Integrate and Promote Heat Pump technology and systems (ASHP, SWHP, GSHP) as an Alternative Energy Resource in Coastal Alaska. Plan to promote heat pumps as an alternative energy/heat source in Coastal Alaska. Identify successful case studies for further implementation in Alaska (there is data available on heat pumps, e.g. Heat Pumps Center). Immediate Local Leadership, AEA DCCED; Legislature; Dept of Law; Utilities; AHFC; Community Development Organizations; Local Governments; Tribes New Strategy B-4: Alaska Market Initiatives Action B-4.2 Plan, finance, and support the execution of Shore power at Public and Private Cruise Docks to Sell Excess Energy to Cruise Ships Identify and execute shore power in Alaskan Ports and Harbors and make feasible. Identify funding sources, including Marine Passenger Fees and federal programs. Immediate-Execution ready, short term (2-5 years) AEA, Coastal Communities Dept of Law; DCCED; DOT&PF New Strategy B-4: Alaska Market Initiatives Action B-4.3 Beneficially electrify the Alaska Ferry Fleet to lower the cost of transportation and assist in reducing the cost of power in coastal communities. Establish plan to convert ferry fleet to electric or electric hybrid vessels, using BC Ferries as a case study for implementation. Identify key ferry routes in Alaska, and evaluate for feasibility and implementation. Work with AKDOTPF strategy and plans. Use electric demand forecasts to assist coastal region utilities and communities generation and transmission resource planning. Short (2 - 5 years)DOT&PF DCCED; Legislature; Dept of Law; Local utilities and IPPs New Strategy B-4: Alaska Market Initiatives Action B-4.4 Identify and support the colocation of industrial load (e.g. data servers) with Alaska hydropower facilities for synergies to lower energy costs Note: Emerging Opportunity - Subcommittee will review in detail in September 2023. Short (2 - 5 years) Private Industry or Utilities DCCED, DEC, AEA New Strategy B-4: Alaska Market Initiatives Action B-4.5 Identify, assist, and fund Battery Energy Storage Systems (BESS) and other Energy Storage Systems (ESS) for successful integration into Coastal communities to increase energy security, grid resilience and to lower energy costs. Identify successful ESS use in Alaska or other case studies beneficial for future use in Alaska communities. Explore all storage opportunities, including pump storage and battery energy. Evaluate opportunity to re-use or re-purpose existing infrastructure and stabilize grids. Integration of renewables. Acknowledge O&M of the systems. Immediate. Change to Immediate and Short term AEA, local communities B&V; AEA; utilities; AIEDA; local communities, DOT&PF New Priority B. Coastal Generation, Distribution, and Storage State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 2DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Strategy C-1: Increase Capital Availability Action C-1.1 Identify a Funding or Financing Mechanism for Rural Communities including a "Local Match" for Federal Grants. Identify local or state funding mechanisms to "bridge the gap" commonly found with federal grant funding - the local match component is often a prohibitive hurdle for rural communities to receive federal grant funding. Medium (5 - 10 years) DOT&PF; Utilities; DEC; ANTHC P3 Partners New Strategy C-1: Increase Capital Availability Action C-1.2 Identify opportunities for Public Private Partnerships to finance/fund energy infrastructure projects in rural Alaska. Strategy C-1: Increase Capital Availability Action C-1.3 State of Alaska commit to sufficient capital budget funding for energy projects in rural Alaska. Strategy C-2: Infrastructure Investment Action C-2.1 Promote a regional planning approach to connected energy, transportation, and broadband infrastructure. Strategy C-2: Infrastructure Investment Action C-2.2 Identify gaps by leveraging studies done by regional ANC corporations, Economic Development Districts, Denali Commission, and other organizations as well as state and federal agencies. Strategy C-2: Infrastructure Investment Action C-2.3 Replace or appropriately displace community-focused aging infrastructure in rural communities of Alaska. Strategy C-2: Infrastructure Investment Action C-2.4 Invest in pilot projects using appropriate technologies that demonstrate a regional approach to supplying affordable and reliable power to multiple communities. Strategy C-2: Infrastructure Investment Action C-2.5 Fund and Construct Opportunities to Connect Rural Communities through Transmission Lines and Other Shared Energy Projects. Where feasible, identify opportunities to connect rural communities through transmission lines and shared energy to enhance redundancy and connectivity. Focus on cost-effective solutions for connectivity. Expand transmission lines to connect outlying communities to the Railbelt (or other regional) grids wherever a cost- benefit analysis indicates a positive value. Where feasible, install renewable energy systems such as wind, tidal, geothermal, and solar to reduce power costs in rural areas. Upgrade rural energy infrastructure such as power houses and bulk fuel farms.Medium (5 - 10 years) AEA DOT&PF; Utilities; DEC; ANTHC P3 Partners New Priority C. Rural Generation, Distribution, and Storage - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Priority C. Rural Generation, Distribution, and Storage State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 1DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority C. Rural Generation, Distribution, and Storage - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy C-2: Infrastructure Investment Action C-2.6 Invest in critical repairs and resilient infrastructure that may be at high risk to current and future natural hazards (wildfire, extreme cold, storms, etc.), to avoid energy disruptions and preserve continuity of operations. Invest in resilient energy infrastructure with focus on most frequent/severe hazards, instead of focusing on repair after the damage or destruction occurs. Reference case studies and future opportunities with FEMA as a funding resource. Deploy next generation renewable energy solutions throughout rural Alaska as legacy systems reach end of useful life, accounting for maintenance and training costs.Medium (5 - 10 years)DOT&PF; Utilities; DEC; ANTHC New Strategy C-2: Infrastructure Investment Action C-2.7 Invest in expanding the grid in rural areas.Long-term (10 years plus)P3 Partners, Utilities Modified CEDs 2022 Plan Action Strategy C-2: Infrastructure Investment Action C-2.8 Evaluate micronuclear and other emerging/underutilized technologies throughout the State of Alaska. Invest in expanding the grid in rural areas in cost effective ways to connect micro nuclear as it is adopted and built in the next 10+ years. Strategy C-3: Lower Operational Costs Action C-3.1 Expand and Inventory technical assistance, training, and workforce development to identify gaps, and increase capability & capacity- building activities for Training a Rural Energy Workforce. i.e. apprenticeship programs for energy production Explore technical assistance such as: workforce training programs, financing mechanisms, grant support, and economic development. Immediate (0 - 2 years) DCCED DOL; DOR ,P3 Partners New Strategy C-3: Lower Operational Costs Action C-3.2 Identify Innovation in Logistics Transportation to Improve Supply Chain Reliability. Identify new innovations in transportation that may support/improve supply chain logistics and reliability in rural AK - follow up with DOT&PF. Prioritize continuity of operations, and enhance redundancy where feasible. Immediate (0 - 2 years) DCCED DOT&PF; Utilities; DEC; ANTHC P3 Partners New Strategy C-3: Lower Operational Costs Action C-3.3 Create and implement a community outreach and education program to combat NIMBYism in energy projects in rural areas. Identify opportunities to educate local communities about proposed or future energy projects. Focus on benefits, particularly related to affordability. Curate outreach to known controversial projects, such as hydro-power or mining. Identify past projects that have successfully navigated opposition mounted by local communities and environmental NGOs. Develop case studies and a suite of tools to engage with opposition. Recognize concerns from those who are opposed, and implement mitigation actions as appropriate. Engage early and often, incorporate visuals and avoid fear mongering. Medium (5 - 10 years) DOT&PF; Utilities; DEC; ANTHC P3 Partners New Strategy C-3: Lower Operational Costs Action C-3.4 Grid modernization and automation Priority C. Rural Generation, Distribution, and Storage State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 2DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority C. Rural Generation, Distribution, and Storage - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy C-4: Improve Economies of Scale Action C-4.1 Identify Economies of Scope/Scale to Provide Multi-Benefit Utility Projects. Identify development opportunities to be shared amongst multiple utilities. Expand transmission lines to connect outlying communities to the Railbelt (or other regional) grids wherever a cost-benefit analysis indicates a positive value. Develop energy projects in coordination with other utilities, such water, sewer, heat, communications (broadband, fiber) or other infrastructure projects (transportation). Share costs associated amongst participants to enhance affordability, and thus pass off affordability to the users. Medium (5 - 10 years) DCCED DOT&PF; Utilities; DEC; ANTHC P3 Partners New Strategy C-4: Improve Economies of Scale Action C-4.2 Identify Energy Anchor Tenants to Provide Economy of Scale for Rural Communities. Identify existing and potential energy anchor tenants who are willing to share costs on energy projects and development. Examples include fishing, mining, industrial tenants. Explore opportunities where anchor tenants can partner with other business and communities for mutually beneficial projects, and enhance affordability. Medium (5 - 10 years) DCCED DOT&PF; Utilities; DEC; ANTHC New Strategy C-4: Improve Economies of Scale Action C-4.3 Identify a Funding or Financing Mechanism for Rural Communities including a "Local Match" for Federal Grants. Strategy C-4: Improve Economies of Scale Action C-4.4 Identify and complete a regional pilot project to demonstrate economies of scale. Strategy C-4: Improve Economies of Scale Action C-4.5 Invest in rural beneficial electrification. Strategy C-5: Improve Data- Driven Decision Making Action C-5.1 Locate and catalog existing energy studies, and update and collect data necessary to make informed value decisions related to energy generation, distribution, transmission, and storage in rural Alaskan villages. Explore opportunities to enhance remote sensing and technology for energy infrastructure in rural/remote locations. Medium (5 - 10 years)New Strategy C-5: Improve Data- Driven Decision Making Action C-5.2 Leverage critical local knowledge provided by residents in coordination with and complement ongoing and planned projects. Strategy C-5: Improve Data- Driven Decision Making Action C-5.3 Explore and leverage existing and new data capture tools including artificial Intelligence tools to quickly analyze existing and new data collected in rural Alaska to provide potential energy solutions Priority C. Rural Generation, Distribution, and Storage State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 3DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Strategy D-1: Establish a Data Department within the Alaska Energy Authority (AEA), using statute as necessary Action D-1.1 Institute or update statutory requirements for AEA Data Department. Strategy D-1: Establish a Data Department within the Alaska Energy Authority (AEA), using statute as necessary Action D-1.2 Fund, develop, and implement a technical and needs assessment Immediate (0 - 2 years)New Strategy D-1: Establish a Data Department within the Alaska Energy Authority (AEA), using statute as necessary Action D-1.3 Fund, develop, and implement a capital asset plan New Strategy D-1: Establish a Data Department within the Alaska Energy Authority (AEA), using statute as necessary Action D-1.4 Develop and fund an operating and maintenance budget, to include the identification of potential funding sources and mechanisms New Priority D. State Energy Data - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Priority D. State Energy Data State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix - 1DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority D. State Energy Data - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy D-1: Establish a Data Department within the Alaska Energy Authority (AEA), using statute as necessary Action D-1.5 Appropriately staff the department based on the technical and needs assessment New Strategy D-2: Establish an energy data governance committee that is responsible for establishing minimum protocols for data collection, quality, storage, use, and access Action D-2.1 Form a technical advisory committee to draft recommendations on where the data governance committee should be established, supported, staffed, membership composition, scope of duties responsibilities, and other issues that may need to be addressed.Immediate (0 - 2 years)New Strategy D-2: Establish an energy data governance committee that is responsible for establishing minimum protocols for data collection, quality, storage, use, and access Action D-2.2 Fund a long-term data governance strategy based on recommendations made by the Technical Advisory Committee. New Strategy D-3: Fund data capacity Action D-3.1 Establish dedicated data collection and analysis positions in state agencies that are responsible for collecting, analyzing, hosting, distributing data in formats that are accessible, and liaising with the AEA Data Department Short (2 - 5 years)New Strategy D-3: Fund data capacity Action D-3.2 Provide professional development and/or skills training opportunities for staff and other agency partners as it relates to data collection and analysis New Priority D. State Energy Data State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix - 2DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority D. State Energy Data - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation. Action D-4.1 Fund a gap analysis of energy data, including existing data, accessibility, quality, age, and what is and would be needed for data- informed decision making.Short (2 - 5 years)New Strategy D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation. Action D-4.2 Revitalize, fund, and maintain energy data platforms and services that ensures the availability and accessibility of data New Strategy D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation. Action D-4.3 Conduct a data audit of the Regulatory Commission of Alaska (RCA), to include recommendations New Priority D. State Energy Data State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix - 3DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority D. State Energy Data - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation. Action D-4.4 Expand the Power Cost Equalization (PCE) report and extent of such data reported Strategy D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation. Action D-4.5 Expand the definition of “energy data” by adopting the TAC definition, ensuring the term is inclusive of heat/thermal and transportation fuel data Strategy D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation. Action D-4.6 Understand how heating and transportation fuel is delivered and used Priority D. State Energy Data State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix - 4DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority D. State Energy Data - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy D-4: Improve existing statewide energy data and collect new, needed data with respect to electricity, heat, and transportation. Action D-4.7 Re-establish annual updates to the Alaska Energy Statistics report Priority D. State Energy Data State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix - 5DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Strategy E-1: Strengthen state- federal coordination and investment Action E-1.1 Develop a funding and implementation toolkit for state/federal energy projects in Alaska Funding and implementation toolkit for energy projects in Alaska will include: resources, guidelines, case studies, and a funding tracker of opportunities for Alaskan communities, ANCs, State Agencies, Utilities, etc.Short (2 - 5 years)AEA DCCED; DOR; ACEP; State Legislature New Strategy E-1: Strengthen state- federal coordination and investment Action E-1.2 Establish a clean energy and transmission line land use designation on state and federal lands. Establish a renewable energy land use designation or transmission line land use designation in Chugach and Tongass Forest plans to allow small community renewable energy development and transmission line corridors on federal lands. Establish an Alaska- Federal Renewable Energy Working Group to develop, collaborate, and execute State-Federal policy that supports State energy goals and rights to advance renewable energy development and transmission lines on federal lands to lower the energy cost for Alaskans. This action item has a blend of Immediate and short-term tasks for implementation.Governors Office, AEA Governors Office, AEA, DCCED; Legislature; DOT Dept of Law; New Strategy E-1: Strengthen state- federal coordination and investment Action E-1.3 Establish a state and/or federal Alaska Clean Energy and Transmission Line Fund or an Alaska Energy Transition Fund Alaska has second world transmission and generation assets. Requires federal support to bring Alaska into this century with same level of service and transmission line capacity aligned with national standards.Medium (5 - 10 years) State Legislature DCCED; DOR; Dept of Law, AEA New Strategy E-1: Strengthen state- federal coordination and investment Action E-1.4 Ensure that criteria for state and federal project investments are weighted toward affordability goals, among other priorities. Implement statewide energy project evaluation process that takes into account low cost, local, clean, and lifecycle. Alaska could use the levelized cost of energy for infrastructure projects. Strategy E-1: Strengthen state- federal coordination and investment Action E-1.5 Implement a state/federal private sector investment energy coordinator (POC). Strategy E-1: Strengthen state- federal coordination and investment Action E-1.6 Utilize DOE LPO Title 17 Clean Energy Financing Program and/or Tribal Energy Loan Guarantee Program. Strategy E-2: Decrease barriers to private sector investments Action E-2.1 Improve and further implement Commercial Property Assessed Clean Energy and Resilience (C-PACER) programs and evaluate the future adoption of an R-PACER program. Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 1DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy E-2: Decrease barriers to private sector investments Action E-2.2 Establish a standard integration tariff and reduction of interconnection and/or wheeling tariffs Strategy E-2: Decrease barriers to private sector investments Action E-2.3 Adopt a Renewable Portfolio Standard (RPS) followed by a Renewable Energy Credit (REC) Strategy E-2: Decrease barriers to private sector investments Action E-2.4 Implement low-interest loan program (concessionary capital, like Power Project Loan Fund) that facilitates affordable energy development and infrastructure improvements. Strategy E-2: Decrease barriers to private sector investments Action E-2.5 Conduct pre-development permitting, surveying, engineering, and/or environmental within principal energy zones. Strategy E-2: Decrease barriers to private sector investments Action E-2.6 Anticipate and plan for strategic demand increases, or pooled asset investments, including through project bundling and beneficial electrification. Strategy E-3: Maintain Residential subsidy focused on equity, while reducing need across communities Action E-3.1 Ensure that PCE funds are available at the right scale over the correct time period. Increase analysis of potential benefits of PCE, to reduce disincentives for lowering energy costs.Short (2 - 5 years) Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 2DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy E-3: Maintain Residential subsidy focused on equity, while reducing need across communities Action E-3.2 Implement a strategic approach to lowering costs according to highest use communities. Strategy E-3: Maintain Residential subsidy focused on equity, while reducing need across communities Action E-3.3 Consider the development of a postage stamp rate alternative, where all Alaskans pay the same rate. Strategy E-3: Maintain Residential subsidy focused on equity, while reducing need across communities Action E-3.4 Increase the use of community facilities allocation to lower State, Tribal, and local governments costs. Strategy E-3: Maintain Residential subsidy focused on equity, while reducing need across communities Action E-3.5 Identify ways in which PCE can lower the cost of doing business, by evaluating residential costs beyond energy as part of the overall household burden. Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 3DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy E-3: Maintain Residential subsidy focused on equity, while reducing need across communities Action E-3.6 Ensure ability to offset debt that results in lower cost energy project development. Strategy E-3: Maintain Residential subsidy focused on equity, while reducing need across communities Action E-3.7 Implement community-based IPPs that sell power to utility for PCE reimbursement. Strategy E-4: Improve the economics of project development Action E-4.1 Establish a liability Trust for utilities, capitalized by the State with pooled contributions to protect against risk of wildfires or other impacts. Strategy E-4: Improve the economics of project development Action E-4.2 Utilize FERC-defined open access on all State-owned/subsidized and RCA regulated utility transmission lines. Transmission related fires can bankrupt utilities. Provide relief and risk exposure to Alaska utilities in return for FERC defined Open Access which would justify the public benefit for providing risk reduction and exposure to Alaska utilities.Medium (5 - 10 years) Dept of Law DCCED; AEA; Legislature New Strategy E-4: Improve the economics of project development Action E-4.3 Establish a green bank for financing of community scale energy efficiency projects. Establish a green bank to finance energy efficiency projects at the community scale in partnership with the private sector. Support initial capitalization by the State. Short (2 - 5 years)AHFC AEA From CEDs 2022 Plan (For Consideration) Strategy E-4: Improve the economics of project development Action E-4.4 Ensure adequate workforce training and skills development alongside job creation goals of State. Obtain federal grants under the IIJA to conduct workforce development, reskilling, and training, including as part of broad industry collaboration. Medium (5 - 10 years) From CEDs 2022 Plan (For Consideration) Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 4DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy E-4: Improve the economics of project development Action E-4.5 Ensuring efficiency of sunk costs and investments, while implementing financial tools (arbitrage, bonds, etc.) that facilitate decommissioning high-cost utilities and aging plant securitization. Strategy E-4: Improve the economics of project development Action E-4.6 Implement pooling of RECs for system optimization and improving economy of scale. Strategy E-4: Improve the economics of project development Action E-4.7 Reevaluate the role of anchor institutions and develop new models for economies of scale, such as through beneficial electrification. Strategy E-5: Evaluate and implement State policy, tax, and other incentives Action E-5.1 Conduct an energy incentives program study to determine capacity of State to make investments. Strategy E-5: Evaluate and implement State policy, tax, and other incentives Action E-5.2 Finalize and implement a statewide energy plan and policy, consistent with Task Force goals. Conduct and implement a statewide strategic plan for energy development.Short (2 - 5 years)AEA ACEP, Launch Alaska, REAP, Alaska Power Association In Progress Strategy E-5: Evaluate and implement State policy, tax, and other incentives Action E-5.3 Evaluate all State energy-related expenses for maximizing impact. Strategy E-5: Evaluate and implement State policy, tax, and other incentives Action E-5.4 Ensure availability of resources for investment, or the ability to forego revenue as part of incentive program. Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 5DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy E-5: Evaluate and implement State policy, tax, and other incentives Action E-5.5 Implement State income tax exemption or credit on revenue produced from private investment in new generation and transmission Strategy E-5: Evaluate and implement State policy, tax, and other incentives Action E-5.6 Reevaluate current mandatory municipal exemptions to encourage increased adoption of local exemptions that align with updated goals to attract private investment. Strategy E-6: Increase State Programmatic Investments Action E-6.1 Increase the capacity for and streamlining of regulatory and permitting action within state agencies and at the federal level. Streamlining the permitting process leads to cost savings for utilities and contributes to cost savings for constituents. Permitting timelines should match the timelines for the expenditure of the funds for grant opportunities. Address staff turnover in the permitting agencies that cause delays in permitting. Execute the State of Alaska's internal streamlining policy and interagency coordination to support and streamline internal state regulatory and land use requirements for Alaska projects, providing a unity of purpose and coordination to advance renewable energy projects to accelerate development, financing, permitting to lower the cost of energy for Alaskans. Medium (5 - 10 years) Office of Governor Office of Project Management and Permitting (OPMP), DNR; DOT&PF; DEC; DFG; Dept of Law New Strategy E-6: Increase State Programmatic Investments Action E-6.2 Strengthen the ability of the State and utilities to address the maintenance and operation needs of Alaska power systems. Strategy E-6: Increase State Programmatic Investments Action E-6.3 Increase availability of resources for weatherization, energy efficiency, and building retrofits. Strategy E-6: Increase State Programmatic Investments Action E-6.4 Ensure adequacy of staff resources at local and state level, including to provide technical assistance. Strategy E-6: Increase State Programmatic Investments Action E-6.5 Evaluate State and local procurement policies that align with affordable and clean energy adoption. Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 6DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy E-7: Respond to and implement evolving energy business models. Action E-7.1 Increase use of energy technology demonstration and deployment programs. Execute pilot and demonstration projects for energy technology that lowers energy costs and leads to commercialization, including through collaboration with entities such as AEA, Launch Alaska, and the National Laboratories. Short (2 - 5 years)AEA ACEP, Launch Alaska From CEDs 2022 Plan (For Consideration) Strategy E-7: Respond to and implement evolving energy business models. Action E-7.2 Implement emerging tools like on-bill financing, net metering, etc. AHFC Strategy E-7: Respond to and implement evolving energy business models. Action E-7.3 Mirror FERC safe harbor rule allowing for back feeding of up to 15% of circuit capacity. Strategy E-7: Respond to and implement evolving energy business models. Action E-7.4 Identify baseline and establish target for T&D capacity utilization of 90%. Strategy E-7: Respond to and implement evolving energy business models. Action E-7.5 Explore locational marginal pricing (LMP). Strategy E-7: Respond to and implement evolving energy business models. Action E-7.6 Implement utility rate incentives for time-of-use rates during periods of lower cost power. Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 7DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority E. Incentives and Subsidies - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 10/2/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Strategy E-7: Respond to and implement evolving energy business models. Action E-7.7 Consider Alaska version of FERC Order 2222 to open wholesale markets to broader participation by aggregators of customer resources. Priority E. Incentives and Subsidies State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 8DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Placeholder strategy to be determined. Action F-1.1 Restructure the RCA with 3 commissioners and administrative law judges to streamline/ handle rate cases. Example states include: Iowa, Virginia, etc. Legislation should be passed (similar to Iowa House File 577) which allows for advanced ratemaking principles Under this legislation, significant projects/improvements are reviewed and approved in advance so all parties have clarity on costs, return on equity, and approval before proceeding (versus traditional pay and pray methodology)Medium (5 - 10 years) DCCED AEA; Dept of Law; RCA; Legislature New Placeholder strategy to be determined. Action F-1.2 Streamline permitting for energy projects Streamlining the permitting process leads to cost savings for utilities and contributes to cost savings for constituents. Permitting timelines should match the timelines for the expenditure of the funds for grant opportunities. Address staff turnover in the permitting agencies that cause delays in permitting.Medium (5 - 10 years) Office of Governor Office of Project Management and Permitting (OPMP), DNR; DOT&PF; DEC; DFG; Dept of Law New Placeholder strategy to be determined. Action F-1.3 Establish state funding to help with local match for federal grant cost share Work with the utilities to understand the feasibility of meeting the local match requirements for various federal grants. Establish a fund to contribute to grant match requirements that may pose a challenge to potential grant recipients. In some cases, utilities may need to raise costs to come up with the local match amount, which negates some of the benefits of being awarded the grant.Medium (5 - 10 years) AEA Legislature; DCCED; OMB New Placeholder strategy to be determined. Action F-1.4 Continue to allow transmission and distribution lines to share DOT right-of-way Note: Need to coordinate with DOT and partners to understand issue to define a recommendation.Medium (5 - 10 years)New Placeholder strategy to be determined. Action F-1.5 Evaluate similar states (such as Wyoming, North Dakota, etc.) for case studies and best practices regarding energy distribution, transmissions, and connectivity. Investigate through energy commissioner organizations and inter- state governmental organizations. Short (2 - 5 years)ACEP AEA New Priority F. Statutes and Regulations Reform - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 9/18/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Priority F. Statutes and Regulations Reform State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 1DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority F. Statutes and Regulations Reform - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 9/18/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. Placeholder strategy to be determined. Action F-1.6 Provide budgetary support for the Regulatory Commission of Alaska (RCA) APA Policy Position (For Consideration)Clarify statute on wildfire liability Alaska’s electric utilities work hard to maintain their rights-of-way for transmission and distribution lines but have no control over vegetation that grows outside their rights-of-way. This creates a scenario in which trees or other vegetation outside the right-of-way -- but tall enough to fall into the right-of-way -- can cause damage, such as a wildfire. The Alaska legislature can protect electric ratepayers by making clear in statute that electric utilities can only be held liable for damage, death or personal injury from contact between vegetation and the utility’s facilities if the vegetation is located entirely within the boundaries of the utility’s right-of-way. The state can help mitigate fire risk by continuing to provide funding for the mitigation of spruce beetle-killed trees, which are a significant problem in many parts of the state. Alaskans already pay some of the highest costs for electricity in the country. Making Alaska utilities, and ultimately their customers, responsible for damages caused by vegetation outside of utility control will drive those costs even higher. This could raise the prospect of financial difficulty for utilities themselves, as has happened in California. Medium (5 - 10 years) Dept of Law DCCED; AEA; Legislature APA Policy Positions (For Consideration) Priority F. Statutes and Regulations Reform State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 2DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority F. Statutes and Regulations Reform - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 9/18/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. APA Policy Position (For Consideration) Prioritize state investment in electric infrastructure and leverage federal funding opportunities Electric infrastructure is the bedrock of the state’s economy and the operation of the daily lives of Alaskans. The Alaska legislature must leverage every federal dollar available that benefits infrastructure with a strong emphasis on electric infrastructure – generation, transmission, and distribution. The legislature should direct the appropriate state agencies to work with electric utilities statewide to determine where funding can best serve Alaskans through investment in electric infrastructure, including renewable energy technologies and digital communications infrastructure. Concurrently, the legislature should call on Congress to focus on funding for electric infrastructure when passing spending bills and when funding federal agency operations. Many areas of the United States continue to benefit from long running federal power marketing administrations (PMAs) that have brought low-cost power to vast reaches of the country. Alaska has not been afforded such federal programs. Through robust state and federal investment in electric systems, Alaska would strengthen its economic health during and following the COVID-19 pandemic. Short (2 - 5 years)Legislature; Dept of Law; OMB APA Policy Positions (For Consideration) Priority F. Statutes and Regulations Reform State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 3DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority F. Statutes and Regulations Reform - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 9/18/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. APA Policy Position (For Consideration) Support reasonable and economic carbon reduction strategies that consider costs to consumers Carbon reduction efforts, whether legislative or regulatory, must allow for a technology neutral approach to decreasing fossil fuel consumption. Integrating renewable generation is one method of lowering reliance on fossil fuels, in addition to demand side management, energy efficiency, dynamic demand, and beneficial electrification, among others. Collectively, they are proven pathways to achieving carbon reduction. Above all, safety, reliability, and affordability must be considered as carbon reduction efforts are undertaken. For many years, Alaska’s electric utilities have developed renewable generation assets and integrated renewable generation into their systems while exploring additional, economically feasible renewable generation. This integration, while partially driven by a goal to decrease carbon emissions, is also reliant on what is technologically and financially feasible at the various-sized electric utilities around the state. It must always be taken into consideration when creating new laws and regulations that ratepayers ultimately bear the costs of any new generation assets. All legislative or regulatory efforts that aim to reduce carbon emissions and increase renewable energy should carefully account for the cost impacts on Alaska electric consumers. Short (2 - 5 years)DEC; DCCED; Dept of Law: AEA APA Policy Positions (For Consideration) Priority F. Statutes and Regulations Reform State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 4DRAFT Strategy Number Action Name (e.g., Policy, Regulation, Program, Improvement, Activity) Action Description (100 words or less) Implementation Timeframe (Immediate, Short, Medium, Long-term) Lead Organization (Primary Organization Responsible to Implement) Partners & Collaborators (Supporting Secondary Organizations) Action Status (New, On-going, Withdrawn) Priority F. Statutes and Regulations Reform - Action Tracking Sheet Appendix II, State of Alaska Statewide Energy Master Plan (Draft as of 9/18/2023) Note: This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time. APA Policy Position (For Consideration) Preserve Power Cost Equalization Endowment, using the Endowment only for its statutory purposes, ensuring all eligible communities can maximize the PCE program, and full funding the PCE program in FY 2023 The Power Cost Equalization (PCE) Endowment must be preserved and maintained to provide certainty for 200 Alaska communities. The PCE program is a vital, lifeline program that makes it feasible for rural Alaskans to have access to affordable electric power and for rural communities to have affordable electricity for streetlights, water and sewer facilities, and other essential infrastructure. The Alaska Power Association urges the Legislature to fund the PCE program from PCE Endowment earnings at 100 percent for FY 2023. Until there is a permanent solution to the high cost of energy in rural Alaska, the PCE program must continue providing economic assistance to customers in areas of our state where the cost of electricity per kilowatt-hour can be three to five times higher than the cost in more urban areas. The state should also explore ways to address the diminishment of PCE for communities that have invested heavily in renewable electricity generation. Some communities that have lowered their reliance on fossil fuels by bringing on clean electric generation have seen lower PCE rates while still facing high electric rates. The state should allow for flexibility within the PCE program to accommodate communities that increase renewable generation but still face high electric costs. Short (2 - 5 years)AEA AEA; RCA; OMB: State Legislature APA Policy Positions (For Consideration) APA Policy Position (For Consideration)Alternative Uses for Coal Regulations Explore alternative uses for coal, such as gasification and hydrogen production.Long-term (10 years plus) University of Alaska, Mining companies From CEDs 2022 Plan (For Consideration) CEDS Action (For Consideration)Carbon and Sequestration Regulations Pursue carbon capture and sequestration to make existing resources cleaner.Long-term (10 years plus) From CEDs 2022 Plan (For Consideration) CEDS Action (For Consideration)Hydrogen Roadmap and Regulations Develop and implement Hydrogen Roadmap for Alaska. Long-term (10 years plus) UAF Governor’s Office, AGDC, University of Alaska Center for Economic Development, ACEP From CEDs 2022 Plan (For Consideration) CEDS Action (For Consideration)Establish Alaska Hydrogen Hub Support the establishment of an Alaska Hydrogen Hub and an Alaska Carbon Capture, Utilization and Storage (CCUS) Hub.Short (2 - 5 years) Governor’s Office AGDC:,Governor’s Office, Congressional delegation From CEDs 2022 Plan (For Consideration) Priority F. Statutes and Regulations Reform State of Alaska Statewide Energy Master Plan Draft as of 10/2/2023 Appendix II - 5DRAFT APPENDIX III. ADDITIONAL ACTION DETAIL SUMMARY PAGES OCTOBER 2023 STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN This is a draft, deliberative document for discussion purposes only. The preliminary action recommendations contained in this document have not been officially endorsed by the Alaska Energy Security Task Force at this time.DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 2 Action Detail Summary Pages Background:The “Railbelt” refers to the interconnected electric grid that stretches approximately 700 miles from Fairbanks through Anchorage to the Kenai Peninsula. About 70 percent of Alaska’s population is served by the Railbelt electric system. The Alaska Energy Authority (AEA) owns the Bradley Lake Hydroelectric Project, the largest hydroelectric plant in Alaska. Energized in 1991, Bradley Lake generates the lowest-cost electricity on the Railbelt and provides clean power to more than 550,000 Alaska residents. There is now a unique opportunity to leverage past investments in Bradley Lake. Through further federal, state, utility and private sector investment in specific shovel-ready capital projects, Alaska can optimize Bradley Lake’s value without incurring significant additional costs to Alaskans. The Alaska Energy Authority (AEA), in partnership with the five Railbelt utilities, has identified several opportunities for transmission line upgrades and battery energy storage systems that will reduce existing constraints on the Railbelt grid by increasing the Kenai Peninsula’s transmission capacity to export power from Bradley Lake hydropower, while also allowing for the integration of additional renewable energy generation. The current system is in need of upgrades to facilitate a diverse fuel supply portfolio. Benefits:• Reduces transmission constraints on Railbelt grid, while also allowing for the quicker integration of additional renewable energy generation.• Provides system redundancy, resilience, and increases reliability.• Benefits utilities and ratepayers by sharing power throughout the region.• Reduces costs for consumers and promotes job creation.• Coordinates planning, financing, and construction of new infrastructure.• Augments and diversifies Environment, Social, and Governance investment portfolio holdings. How Do We Get There?• Unify and convey all existing transmission assets along the Railbelt and Bradley Lake to AEA or a new non-for-profit regulated utility for the net book value.• Develop financing plan.• Develop transmission, operation, and control reform (potentially the Iceland model) with a regulated version of management committee. • Align ERO statute and regulations with transmission reform.• Complete design, permitting, and right-of-way acquisitions.• Execute construction and commissioning. Implementation Timeline: 2023 – 2035 Expected Results:This strategy will result in a more resilient and reliable transmission and electric grid system that will lower rates, help bring online clean energy, reduce costs for consumers, and promote job creation. STRATEGY A-1: UNIFY TRANSMISSION ACTION A-1.1: Unify and convey all existing transmission assets along the Railbelt and Bradley Lake to AEA or a new non-for-profit regulated utility for the net book value.DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 3 Background:Today, 80-90% of the Railbelt’s energy (heat and power) is generated using Cook Inlet (CI) natural gas, a supply source which is forecasted to fall short of demand as soon as 2027. Alaska utilities may likely need to import Liquified Natural Gas (LNG) to meet short term supply needs and this is anticipated to increase the cost of energy and introduces potential energy security concerns. In order to ensure a secure, local supply of energy that is affordable and reliable, the Alaska Energy Security Task Force, (AESTF) Railbelt Subcommittee set a long term goal of significantly diversifying the Railbelt’s energy generation. Today, many proven and cost competitive electricity generation technologies exist and are ready for at-scale deployment across the Railbelt, and the state as a whole. Alternative technologies for central heat generation are not as ready to deploy and distributed heat generation solutions such as heat pumps point to electricity generation as their source. Based on this, the Railbelt Subcommittee recommends a near term focus on diversifying electricity generation. This will conserve natural gas for heat while increasing energy security with local and diverse electricity generation projects. In order to ensure Alaska’s future energy mix is affordable, reliable and secure, it’s critical that diversification targets are set and positively reinforced. To ensure strong commitment and action to electricity generation diversification the Railbelt Subcommittee recommends the State adopt a Clean Energy Standard with incentives for new generation projects and for utilities when diversification goals are reached. The Railbelt Subcommittee considered both a Renewable Portfolio Standard and a Clean Energy Standard. Ultimately a Clean Energy Standard was preferred as it allows the widest range of generation technologies to compete driving affordability and gives Alaska the most options to diversify. Secondly, a Renewable Portfolio Standard policy typically includes penalties when targets are not met. Given Alaska’s co-op utility structure, these penalties would pass directly to co-op members and drive up electricity prices which is counterproductive to the AESTF objective of affordable energy. Penalties may also likely lead to utility staff spending time to request relief or negotiate penalties where issues are encountered with meeting diversification targets; tying up valuable utility staff time and distracting staff from deploying new generation projects. Based on this, the Railbelt Subcommittee recommends providing incentives for generation diversification rather than penalties to drive the right behaviours, action and outcomes for our State. The Railbelt Subcommittee recommends the following incentives be implemented with a Clean Energy Standard: 1. Direct Payment to Utilities for Achieving Diversification Targets: Ultimately, it is up to each individual utility to agree to terms with these different types of generation so that it can be included in their portfolio. To incentivize utilities to consider a variety of options, the State of Alaska can award each utility with a direct payment when diversification targets are reached. This direct payment rewards utilities for diversifying and will result in an immediate reduction of rates for consumers, aligning with the AESTF mission of affordable energy. 2. Augmentation of the Renewable Energy Fund (REF): To facilitate significant diversification of statewide electricity generation, with a partilcuar emphasis on the Railbelt, it is important to have many generation projects being developed as only a small fraction will succeed in being fully developed. Project development is inherently risky and carries the most uncertainty, particularly for generation technologies which have not been broadly deployed in Alaska. To encourage numerous and diverse generation project development, the State should augment the Renewable Energy Fund to provide matching funds for development expenses. The intent of this funding structure is that grant funds will be a small fraction of the total project cost but will be awarded at a time when the project is most vulnerable. This will increase the number of projects being developed and accelerate the diversification of the Railbelt electricity generation. STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.1: Adopt a Clean Energy Standard with incentives to facilitate reaching diversification goals DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 4 Action Detail Summary Pages 3. Augmentation of the Power Project Fund (PPF): New generation projects can also face obstacles with securing competitive debt terms for projects in Alaska given it’s remoteness and that for many technologies is seen as a nascent market. Debt interest rate and term (duration) significanty affect project economics and ultimately the energy price paid by consumers. Providing a reliable debt source for generation projects which diversify the Railbelt’s power generation will increase the number of successful projects, reduce the energy cost to consumers and earn the state a modest return. Given the funding scale of these projects, it’s important that this capital support from the state is structured as a loan and not a grant. This ensures responsible project spending while generating a return for the state. Benefits:Diversify statewide, with a particular emphasis on Railbelt Electricity Generation• Conserve CI natural gas supply for heating and base load to integrate new generation sources• Provide secure electricity supply through locally built generation projects• Enable affordable energy across the state• Increase energy reiliability where no one source dominates or threatens overall supply• Economic development with local projects How Do We Get There?Institute a Clean Energy Standard with Incentives to facilitate reaching diversification goals• Clearly state Railbelt generation diversification percentages and target dates• Adopt the following incentive program to drive diversification: 1. Direct Payment to Utilities for Meeting Diversification Targets:• All direct payments to a Utility from the State of Alaska are a direct pass through to energy consumers• Establish a $/% diversification value and diversification percentages at which payouts are received• Payout will be made if diversification percentage is achieved by target date• Direct payment from the State will be used by the utility to directly lower member costs, effectively lowering the cost of electricity• Ideally the incentive payment would be illustrated on member bill so public can see the benefit of utility diversification 2. Augment the Renewable Energy Fund to:• Provide up to 50/50 matching funds for projects which diversify the community or regional generation mix. • The projects must demonstrate how they’re providing affordable energy that is reliable and local• Matching funds will be used for project development costs only • Allocate annual funding for this program such that funding is secure and can be efficiently deployed. Increase the reward cycle (e.g. 2x/yr) to enable new project ideas to move forward with development at a faster pace than the current annual REF award process. • Increased operational funding for AEA to accomodate increased administrative workload, including but not limited to elements such as additional staff or consultants to assist in program and/or application streamlining. 3. Augment the Power Project Fund to: • Provide loans, for all development phases, for projects greater than 10MW in size• For projects greater than 10MW increase the approval thresholds for AEA Board and Legislative approval such that it is commensurate with utility scale projects• Adequately capitalize the PPF program to support utility scale generation projects• Provide operational funding staffing to efficiently and timely process increased volume of loan applications. STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.1 (CONT.): Adopt a Clean Energy Standard with incentives to facilitate reaching diversification goals DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 5 Implementation Timeline: Implement policy change in 2023/2024 legislative session Expected Results:• Diverse electricity generation projects being built over the next 10-15 years• Accelerated diversification timeline• Lower cost power from new generation projects, ultimately flowing down in the form of reduced rates for ratepayers across varying time domains.• Economic development across those funded communities, including the Railbelt. STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.1 (CONT.): Adopt a Clean Energy Standard with incentives to facilitate reaching diversification goals DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 6 Action Detail Summary Pages Background:The general powers and duties of the RCA are defined in Alaska Statute 42.05.141. Specifically, it is tasked with the power to “appear personally or by counsel and represent the interests and welfare of the state in all matters and proceedings involving a public utility[.]” The Railbelt Generation, Distribution, Transmission, and Storage Subcommittee (RGDTSS) has determined that the state should be working toward a long-term goal of diversifying power generation with an emphasis on local supply, reliability, and affordability. In support of this goal, the RGDTSS recommends the legislature amend AS 42.05.141 to broaden the RCA’s scope of considerations and ensure it has the ability to consider projects related to power generation. Benefits:• The amended statute provides the RCA with more definition on what truly is in the best “interest and welfare of the state” beyond just setting reasonable rates and promoting conservation. • Pushes the Railbelt utilities towards diversification of power generation. How Do We Get There? • Amend AS 42.05.141 (c) add new subpart (d) and renumber existing subpart (d) as follows: (c) In the establishment of electric service rates under this chapter the commission shall promote the conservation and diversification of resources used in the generation of electric energy. (d) When considering whether the establishment or approval of electric service rates under this chapter is in the public interest the commission shall (1) recognize the public benefits of allowing a utility to negotiate different pricing mechanisms with different suppliers and to maintain a diversified portfolio of resource contracts to protect customers from the risks of inadequate supply or excessive cost that may arise from a single pricing mechanism; and (2) consider whether a utility could meet its responsibility to the public in a timely manner and without undue risk to the public if the commission fails to approve a rate or a contract proposed by a utility. (e) When considering whether the approval of a rate or a gas supply contract proposed by a utility to provide a realable supply of gas for a reasonable price is in the public interest, the commission shall…[.] Implementation Timeline: Implement timeline is in the 2023/2024 Legislative Session. Expected Results:This structured execution list offers a clear roadmap of the proposed steps to promote the Action to lower the energy cost for Alaskans for future generations. STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.2: Modify existing statute(s) requiring the Regulatory Commission of Alaska (RCA) to consider long term diversification goals when approving additional/new Railbelt power generation.DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 7 Background:The Alaska Energy Authority (AEA) owns the Bradley Lake Hydroelectric Project (Bradley Lake), which has been a low-cost source of electricity for the Railbelt and 550,000 Alaskans for more than 30 years. The 120-megawatt (MW) facility generates about 10 percent of the total annual power used by Railbelt electric utilities at some of the lowest-cost energy in the state. The “Railbelt” refers to the interconnected electric grid that stretches approximately 700 miles from Fairbanks through Anchorage to the Kenai Peninsula. About 70 percent of Alaska’s population is served by the Railbelt electric system. The proposed Dixon Diversion Project would boost the energy potential of Bradley Lake, the largest hydroelectric plant in Alaska. The project would be located five miles southwest of Bradley Lake dam, approximately 27 miles northeast of Homer on the Kenai Peninsula, and divert water from Dixon Glacier, increasing the annual energy production of Bradley Lake by 50 percent — or the equivalent of 24,000-30,000 homes. Bradley Lake currently electrifies the equivalent of 54,000 homes. Benefits:• Increases Bradley Lake’s energy production capacity by 50 percent by leveraging existing generation assets.• Enhances Alaska’s energy security by increasing renewable penetration and grid stability, improving resilience to fuel price fluctuations and supply side disruptions, and regulating other renewable energy.• Fosters economic development through job creation. • Promotes environmental sustainability.• Power Sharing Agreements with Railbelt Utilities provide stable long-term returns through revenue stability and market risk mitigation.• Produces a substantial amount of renewable energy that will reduce greenhouse gas emissions and combat climate change.• Augment and diversify Environment, Social, and Governance investment portfolio holdings.• All land is owned by the State of Alaska How Do We Get There?AEA is currently conducting feasibility studies to assess the potential of increasing hydroelectric power generation at Bradley Lake. These studies include engineering studies (feasibility, hydrological, geological) and environmental studies (fisheries, water quality, and geomorphophology). The Dixon Diversion Project would expand Bradley Lake by capturing outflow from the Dixon Glacier and conveying it to Bradley Lake for generation. The main project components include:• Small diversion dam and intake below the Dixon Glacier,• Gravity flow 4.7 mile tunnel to Bradley Lake, and• Raise of Bradley dam to lake level by 14 feet. Implementation Timeline: 2023 – 2025: Engineering and Environmental Studies2026 – 2027: Federal Energy Regulatory Commission (FERC) License Amendment2028 – 2032: Construction Expected Results:The increased storage would provide Bradley Lake with an additional 55,000 megawatt-hours of “battery storage.” STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.3: Additional details on Dixon Diversion Project DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 8 Action Detail Summary Pages Background:The Susitna-Watana project has been on hold since 2017. Considerable expenditures were made to develop and license the project in the 1980s and from 2010 to 2017. The project is a viable alternative to meet the State’s goal of 80 percent sustainable power by 2040. Once the project is licensed the State has a 10-year window before construction must begin. This should afford sufficient time for the State to determine the most advantageous approach to build the project. Alaska has a strong track record of developing successful hydroelectric projects that provide clean, reliable energy across the state. Hydroelectric power is Alaska’s largest source of renewable energy, supplying about 27 percent of the state’s electrical energy in an average water year. Dozens of hydro projects provide power to Alaskans, including the 120-megawatt Alaska Energy Authority-owned Bradley Lake project near Homer, which supplies 10 percent of the Railbelt’s electrical energy. The “Railbelt” refers to the interconnected electric grid that stretches approximately 700 miles from Fairbanks through Anchorage to the Kenai Peninsula. About 70 percent of Alaska’s population is served by the Railbelt electric system. AEA has completed a feasibility level design and was approximately two-thirds of the way through the Federal Energy Regulatory Commission (FERC) Integrated Licensing Process when it was paused by the previous administration. To proceed, the FERC licensing process would need to be completed at a cost of $50-100 million. The anticipated construction cost is $5.6 billion ($2014). Financing type and level are not yet finalized, but AEA’s financial consultant recommended Rural Utilities Service (USDA) and government obligation bonds or by the private sector, financial modeling indicated the lowest long term cost of energy compared with other fuel sources. Benefits:The proposed Susitna-Watana Hydroelectric Project is a large hydro project that would provide long-term stable power for generations of Alaskans. The project would result in approximately 70 percent of the power generated in the Railbelt originating from renewable sources, up from the current 15 percent — a nearly four-fold increase. As part of the project, transmission lines will be connected to the existing Railbelt transmission system providing a more secure transmission system, and an access road will be constructed. The Susitna-Watana Hydroelectric Project will help provide reliable power for future generations of Alaskans, diversify Alaska’s energy portfolio, and accelerate the transition to renewable energy. How Do We Get There?1. Update the Project Management Plan with specific focus on the approach, budget, and schedule to complete licensing activities. 2. Update construction cost and project economics 3. Meet with FERC staff to determine the licensing approach and studies necessary for FERC to conduct their National Environmental Policy Act (NEPA) process and make a licensing decision. 4. Go/no go decision for final FERC licensing. STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.3: Additional details on Susitna-Watana DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 9 STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.3 (CONT.): Additional details on Susitna-Watana Implementation Timeline: Update the Project Management Plan regarding approach, budget, and schedule, including updating construction cost and project economics before a decision is made to complete FERC license.• Preparation, Planning, Collaboration, and Environmental Studies 2-3 years• FERC Review & Determination 2 years• Project Execution Phase && Construction Phase 9-11 years• Operational Phase 100 years Expected Results:Based on the economic studies conducted a decade ago, the project remained a viable alternative with a levelized power cost of about 6.5 cents per kWh. Based on this information and the amount of power the project would generate annually, the project remains a viable alternative to meeting the Energy Security Tasks Forces goals. The State should undertake the tasks outlined above to successfully license the project. Once the project is licensed, the State has options to complete the project.DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 10 Action Detail Summary Pages Background:The Alaska Utilities Group June 28, 2023 Phase 1 Assessment Cook Inlet Gas Supply Project estimated that 2021 natural gas consumption from the Cook Inlet was comprised of approximately 49 BCF (67%) for heating requirements and 24 BCF (33%) for electrical generation. Forecasts for continued gas consumption for electrical generation are flat or decreasing by 5 BCF/yr. Assuming natural gas remains the space heating fuel of choice on the Railbelt, the largest distributor for natural gas for space heating on the Railbelt projects no decline in demand over the next 20 years. Without a change in this fuel source, natural gas will remain a necessary energy source on the Railbelt. The Utilities Group Study determined that the median case gas supply shortage in the Cook Inlet is projected to be 8 BCF/yr beginning in 2028 and growing to 52 BCF/yr in 2040. In the short term, in order to meet the expected supply gas shortfall in 2027-2028, a decision to pursue LNG imports will likely need to be made in late 2023. In the long term, the study found that a gas pipeline from the North Slope could meet the projected demand most economically. Benefits:The 2023 contract price for natural gas from the Cook Inlet is approximately $8/Mcf. Imported gas is forecast to cost approximately $12/Mcf. Incremental supply potentially available from augmented Cook Inlet production is forecast to be generally at or above the imported gas cost. Gas prices from the proposed AK LNG project are estimated at $4.40/Mcf., while a smaller subsidized State-owned pipeline might deliver $9.10/Mcf. Alaska is presently near the bottom compared to other states in terms of economic growth. Out migration from rural Alaska is rampant due to the lack of economic opportunities. Importing LNG into our resource rich state may be necessary in the short term but would be contrary to the goals of energy security over the long term. The availability of a local and long term fuel source to support affordable and reliable baseload power generation throughout the Railbelt would provide stability for economic development and a platform around which further diversification of generation could confidently occur. Railbelt businesses and residents would enjoy predictability for their space heating requirements. Availability of natural gas from a pipeline could allow substantial new projects, such as the Donlin Gold Project in western Alaska, to help defray the cost of building gas pipeline infrastructure, and associated transmission and distribution, into western Alaska. How Do We Get There?Alaska needs to advance on two parallel tracks: (1) Advance the AKLNG project (permitting, design, financial), including Alaska using its financial strength as necessary to support the negotiation of commercial terms that could lead to a positive project decision; and (2) Resume planning on the in-state “bullet” pipeline so that a backup plan is in place to support Alaska’s need for natural gas if the AKLNG project does not proceed. Implementation Timeline: Alaska must keep its options open for support of our economy over the next decades. While imports of LNG may occur in the short term, doing so over the long term or long past 2030 would be regrettable, would do little to boost our local economy. Expected Results:Unlocking Alaska’s stranded natural gas and monetizing these assets will provide long term energy security, and positive economic benefit for all Alaskans, but should not be done so at the expense of diversifying the overall energy generation mix. STRATEGY A-2: DIVERSIFY GENERATION ACTION A-2.3: Additional details on AKLNG.DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 11 Background/Benefits:All other things being equal, if the fixed infrastructure costs of a power grid are spread over more customers and greater energy loads, customers will end up paying less on a per-kWh basis. This strategy has been used in Iceland, for example, where a high volume of production and sales have created efficiencies and economies of scale. According to analysis provided by Holdmann and Gudleifsson (in preparation), Iceland’s total electric production and Alaska’s tracked very closely until the mid-1990s, as did the delivered cost for electric power. After that point in time, the trajectories diverged significantly both in terms of annual production and sales as Iceland actively courted and attracted large industry (aluminum smeltering) to its electric grid. This new industry increased Iceland’s energy demand by four-fold. Iceland’s cost of power delivered to the customer’s meter is now $0.7-$0.13 per kWh, as compared with $0.19-$0.26 for power from Alaska’s Railbelt grid. A similar approach could be undertaken on Alaska’s Railbelt to drive the cost of power down for all customers and spur continued economic growth. Examples of new, large customers on the Railbelt could include ore processing of locally-resourced materials as well as new fuel generation production facilities for the transportation industry (air carriers, shipping, etc.), among others. A key insight is that Iceland simultaneously sought out new industry and committed to lower than current energy costs to incentivize industry to select Iceland as the preferred location. How Do We Get There?This strategy assumes that necessary transmission capacity and reliability upgrades are completed to handle increased loads. To facilitate and incentivize substantial load growth, three possible actions were identified, including (1) issuing an RFP to industry for a large load that would be provided at a guaranteed low energy price (the energy price could be tiered based on amount of load growth), (2) providing tax credits or similar offsets for proposed large load customers to reach attractive power rates, and (3) identifying sites along the Railbelt which are already built to handle load growth. (1) Upon sufficient analysis of rates achievable by large load additions to the Railbelt, an RFP could be issued by a coordinating Railbelt entity, utility, or the State guaranteeing a rate for power in exchange for the load addition to the grid. Such an approach would eliminate risk for a potential large industrial customer and also ensure load growth for the Railbelt. Long term rate stability would promote industry investment and aggregation of demand side resources. (2) Alternatively, if a potential industrial customer could not add enough load to the grid to guarantee a satisfactorily low rate, the State could offset the difference with a tax credit or similar vehicle. Again, this approach would help eliminate risk for the new industrial customer and attract economic investment in the state. The tax credit amount would be informed by the estimated savings to utility co-op members due to the load growth associated with the new industrial customer. (3) In concert with the above actions, it is important to identify areas on the Railbelt that are well-suited to large load growth in the short term, without necessarily waiting for transmission upgrades. Identification of these sites would help potential large industrial customers hone in on realistic locations and spur investment. In addition to specific sites, there may be larger geographic areas that can accommodate rapid growth of distributed loads, such as electric vehicles and heat pumps. These “load-friendly” areas could be further enhanced by management of of the distributed loads (“load as a resource”) so they can strengthen, not strain, the grid.growth. One risk of these actions is potential cost overruns in the buildout of any required generation for increased loads, the contingencies and responsible parties for which would need to be considered carefully. However, this risk must be viewed in context because cost overruns from new infrastructure would likely be even more problematic without load growth. STRATEGY A-3: INCREASE DEMAND ACTION A-3.1: Significantly increase load to drive down energy rates.DRAFT PRIORITY A. RAILBELT TRANSMISSION, GENERATION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 12 Action Detail Summary Pages Implementation Timeline: 1. Identify areas within the Railbelt which are well-suited for load growth (minimal to no upgrades or new generation needed): 1-2 years 2. Establish incentivized industry/anchor tenant rates: 1-2 years. 3. Issue state-led RFP for new industry articulating $/kWh rate scale based on load growth amount or state tax incentives to offset energy cost for new industrial customers based on load growth savings to co-op members: 2-5 years Expected Results:The Railbelt will significantly increase its load to drive down prices for all consumers and spur economic development overall. STRATEGY A-3: INCREASE DEMAND ACTION A-3.1 (CONT.): Issuing an RFP to industry for a large load that would be provided at a guaranteed low energy price (the energy price could be tiered based on amount of load growth).DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 13 STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.1: Establish, require, assist, and implement community Integrated Resource Plans (light) to forecast energy demand and generation for community and regional future energy needs to lower energy costs. Background:Integrated Resource Plans (IRP) and their associated forecasts of demand, generation, transmission, and distribution with public input are a tried and proven electrical industry methodology to coalesce State and community energy goals openly and transparently. Large utilities with regulatory oversight can engage in extensive plans that require deeply engaging studies. On the other hand, a lighter integrated resource planning analysis based on the collaboration of community energy needs is a cost-effective approach to local strategic and tactical energy planning required to move toward lower energy costs. All communities engaged in future supply uncertainty, rising demand for heat pumps, conversion from fossil fuel use to lower-cost renewables, and electrified transportation benefit from intelligent and collaborative planning from utilities, communities, non-utility generators, and the public. The critical component in this process is public participation, as it provides an opportunity to educate the public, build support and constituencies required to advance renewable energy projects and transmission, and ultimately focus on lowering the energy cost for Alaskans. According to the Pacific Northwest National Laboratory (PNNL), Over 35 US states require utilities to file IRPs or equivalent planning yearly or up to once every four years. These requirements are imposed either through regulation or legislation. The US Department of Energy (DOE), in its 2016 publication, “Sustainable Energy Solutions for Rural Alaska, provided a recommendation for Alaska Utility resource planning to identify a utility’s least-cost path over time. These efforts are sometimes called “least-cost integrated resource plans” or simply “integrated resource planning” (IRP) when the scope of the resource decisions include demand-side considerations. The DOE publication explained that the IRPs typically include scenario planning and consideration of uncertainty. IRPs are also typically high-level plans frequently with time horizons of 20 years that look at a broad array of resource choices. However, they may include specific project-related and transmission analysis in the near term (i.e., 1-5 years).DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 14 Action Detail Summary Pages STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.1 (CONT.): Establish, require, assist, and implement community Integrated Resource Plans (light) to forecast energy demand and generation for community and regional future energy needs to lower energy costs. Benefits:The State of Alaska can optimize State resources (and parlay federal resources) by establishing, requiring, assistng and implementing and Integrated Resource Plan Light (IRPL) for every utility in Alaska that requires a periodic update to ensure that local and grassroots energy planning is occurring collaboratively at the local Alaskan level with utilities, tribes, non-utility operators, community leadership, NGO’s and the Alaska public so that there is a unified focus and format to ensure that no community is left behind in Alaska’s transition to lower cost and self-sustaining energy for current and future generations of the affected community. How Do We Get There? Establish an Alaska-based IRPL, easy-to-implement model and format. Upon acceptance of the RCA, request each regulated Alaska utility to guide on with minimally established requirements based on prudent IRP practices. This model and format can be initiated and supervised by the Alaska Energy Authority and collaborated with the Regulatory of Alaska and Attorney General Office, Regulatory Affairs & Public Advocacy Section (RAPA). Municipal utilities and other non-regulated electrical utilities in Alaska can also adopt Alaska’s IRPL model. While large Alaska utilities can use this model, the use of the IRPL would not detract from the RCA authority to impose a more robust IRP on Alaska’s sophisticated electrical utilities, and the IRPL can serve as an interim or an update adjustment to a utilities existing and perhaps more robust IRP. AEA and any state of Alaska generation and transmission funding can use the IRPL to determine the viability and economic justification of the public IRPL as a requirement to obtain state funding. RCA can be a repository for the public record and public dissemination of all Alaska utility load and generation forecasting so that other communities and interested parties can learn and adapt from other communities’ planning efforts. AEA and other state agencies can provide resources and technical assistance to assist Alaskan utilities and communities. AEA can require IRPL as a prerequisite for future assistance, aid, and funding as an incentive to collaboratively participate together to analyze the community energy needs, demands, and agreed-upon solutions to lower the energy cost for the affected community. An IRPL also certifies that a utility and a community are wisely and responsibly planning to conserve PCE burdens and preserving PCE trust funds by optimizing appropriate energy solutions on a community-by-community basis.AEA, the Denali Commission, and other state agencies can assist a community with implementing the solutions and results from a community IRPL. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:This Action item, IRPL, with its implementation steps, offers a fundamental milestone required to methodically transition to premeditated energy planning in an open, objective, and transparent process that will lead, if properly implemented and conducted, to lower cost energy and energy security for Alaskans.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 15 STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.2: Strengthen Alaska’s Net Metering energy framework, tariffs, and regulations for Alaska’s diverse stakeholders to promote net metering investments to provide grid resiliency and energy security and lower the energy cost for Alaskans. Background:Net Metering is a billing arrangement for owners of renewable energy systems. Under Net Metering, excess electricity generated by an Alaskan customer’s renewable energy system is sent back to the utility grid, offsetting the electricity the customer draws from the grid when their system isn’t producing electricity. Net Metering of private energy systems plays an integral role in the ongoing transition to more sustainable and flexible power grids and lowers the costs of power for Alaskans. Benefits:An advanced Net Metering statutory and regulatory framework for Alaskans can optimize mutually beneficial benefits from an advanced net metering program to act as a linchpin for a sustainable, resilient, and economically advantageous energy future in the islanded grid and transmission interconnected Alaska communities to provide a diverse energy portfolio that invigorates and sustains private and public investment, provides energy security and grid resiliency benefits while lowering the energy costs for Alaskans. How Do We Get There? Investigate, evaluate, recommend, and update/modify changes to Alaska’s net metering laws and regulations for Best Management Practices (BMP) based on other successful State net metering programs. Encourage the Alaska Energy Authority (AEA), Alaska Housing and Finance Corporation (AHFC), Denali Commission, and other agencies to assist and finance community, tribal, business, and residential net metering investments in Alaska to improve grid stability and resilience and lower energy costs. Policy Framework and Regulation:Develop through the Governor’s office, AEA, and Regulatory Commission of Alaska (RCA) a clear, supportive regulatory framework that invigorates and favors net Metering incorporating vigorous net metering models and best management practices (BMP). Provide resources, leadership, and agency assignments and oversight to ensure the resulting regulatory framework provides long-term clarity and certainty to private/public investors, community energy security, and utilities. Infrastructure Development:Invest and finance grid infrastructure for residential, business, community renewables, and grid distribution systems to handle increased distributed energy resources and increase energy security through AHFC, AEA, AIDEA, Tribal and federal funding to facilitate grid interconnectivity for renewable energy sources. Develop and promote short and long-term energy storage solutions, such as battery systems, to address the intermittent nature of community and residential renewable sources like solar and wind. Incentivization and Financial Support: Develop and offer a breadbasket of incentives such as tax credits, rebates, or grants for individuals and businesses that invest in renewable energy systems. Set up a competitive feed-in tariff for excess energy fed into the grid. Work to develop State Agency and federal programs to provide zero or low-interest loans or financial incentives for energy storage solutions. Develop and structure incentives to assist higher PCE cost communities and the PCE program. Outreach and Stakeholder Collaboration:Create platforms for dialogue between utility companies, private investors, and government agencies. Incentivize and encourage utilities to develop advanced net metering models that benefit from distributed generation rather than viewing it as a threat.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 16 Action Detail Summary Pages STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.2 (CONT.): Plan, finance, and support the execution of Shore power at Public and Private Cruise Docks to Sell Excess Energy to Cruise Ships. Engage with Native tribes and corporations to ensure their perspectives and needs are incorporated. Encourage and direct State of Alaska (SOA) agencies and utilities to partner with Alaska university programs and renewable energy Non-Governmental Organizations (NGO), boroughs, and city governments to integrate renewable energy net metering in development planning for localized energy security, emergency planning, and sustained energy operations with natural disasters. Develop state code and design criteria using prudent utility practices for net Metering. Consider state procurement agreements for integration hardware and controls selection and purchase. Technology and Innovation:Promote research and development in renewable energy net metering regimes tailored to Alaskan conditions.Support innovation in grid management tools and technologies using best management systems to efficiently and effectively handle distributed energy. Collaborate with tech companies to integrate advanced consumer energy management systems, such as smart meters and home energy management systems, that assist utilities and overall grid management. Monitoring and Feedback Mechanisms:State of Alaska: Stand up or administer/assign a dedicated agency or body to monitor utility progress and impacts of the net metering program and make suggestions to recalibrate and use adaptive management to gain incremental effectiveness of net metering regimes. Continuously gather net metering and utility participant feedback and iterate on the program’s design and incentives. Publish annual reports for AEA, AIDEA, RCA, the Governor, the Legislature, and the public to highlight achievements, challenges, and next steps. Implementation Timeline: This action item has a blend of Immediate, short-term, mid-term, and long-term (follow-up, review, and recalibration as necessary) tasks for implementation. Expected Results:The net metering roadmap places Alaska at the pinnacle of energy innovation and leadership while empowering net metering participants and utilities to collaboratively advance the state of Net Metering in Alaska as a public interest good. This strategy and tactics empower Alaskans to amplify private and public investments, fortify grid stability, strengthen grid resilience, and slash energy expenses. Embracing this Action Item, Alaska is assisting in meeting Alaska’s energy demands and security while ensuring Net Metering advances are addressed collaboratively, openly, transparently, sustainably, and economically, ensuring a sustainable and cost-effective energy future that reduces the energy cost for Alaskans.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 17 STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.3: Strengthen and Streamline the State of Alaska’s internal state regulatory and land use administrative processes to accelerate approval to advance strategic energy projects and transmission for regional energy security and lower energy costs. Background:The State of Alaska has multiple departments with diverse missions and responsibilities. Developing energy projects in Alaska requires developer coordination with competing agencies with differing priorities and willingness to assist a project developer. This lack of unity of effort can lead to chaos and time delays in permitting and executing energy projects and transmission with differing state agencies. There is a need for a navigation coordinator and assistance for Alaska communities and Alaska renewable energy developers to coordinate among the differing State Agency requirements. Benefits:The development of State policies and oversight that produce a coordinated and affirmative mindset for developing cost-effective renewable energy and transmission lines in Alaska lowers energy costs for Alaskans while also assisting developers in their pursuit with federal agencies in meeting national clean energy goals through mutual cooperation, respect, and understanding. How Do We Get There? Establish an Alaska Energy Authority (AEA)-sponsored in-state working group/oversight body between the Governor’s Office, AEA, and State agencies to find common ground and purpose to streamline renewable energy, transmission, and energy project interconnection permitting, regulations, and State of Alaska authorizations. The focus and mindset are to “promote” and develop sustainable energy projects and related transmission lines to accelerate permit processing and get to “yes” renewable energy development to lower costs and increase energy security for Alaskans. Each State agency and department conducts a critical internal review to identify permitting and authorization bottlenecks that impede or slow down renewable energy development and then develop internal agency courses of action and corrections necessary to fulfill the overarching directive to lower the cost of power for Alaskans. Each State agency assigns a Change Officer duty and responsibility for implementing and executing departmental administrative changes based on permitting review/audit and course of action analysis. Develop an energy development interdepartmental liaison between Commissioners and delegated staff to coordinate and accelerate renewable energy project and transmission development. Identify state laws or regulations that impede or block renewable energy and transmission development and make recommendations to change statutes and regulations for the Governor and legislative leadership to accelerate energy development, transmission, and interconnections to lower the cost of energy for Alaskans and Alaska industry.Create directional versus aspirational intentions to deliver results for Alaska’s citizens desiring the lowest long-term and sustainable energy costs. DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 18 Action Detail Summary Pages STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.3 (CONT.): Strengthen and Streamline the State of Alaska’s internal state regulatory and land use administrative processes to accelerate approval to advance strategic energy projects and transmission for regional energy security and lower energy costs. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:The State of Alaska, with careful and planned execution, can advance and promote Alaska’s renewable energy development with cooperation, support, and a unity of effort between State agencies to support and accelerate the growth of Alaska’s renewable energy resources for the maximum benefit of Alaskans, reducing energy costs and providing the energy security that Alaskans are entitled to from their State government leadership. This structured execution list offers a clear roadmap of the proposed policy initiatives and steps to promote the coordinated and cooperative development of energy resources between and among state agencies to provide a unity of effort to execute the State energy plan and lower the energy cost for Alaskans.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 19 STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.4: Strategize and Prioritize State of Alaska funding to match federal funding and federal financing to build and expand Transmission and Distribution Lines in Alaska to bring Alaska on par with the US transmission system for Alaskan energy security and lower energy costs. Background:Despite its vastness, covering 17.5% of the US landmass, Alaska’s transmission system is strikingly underdeveloped. With only 1,697 miles of high and low-voltage transmission lines, it represents less than 0.25% of the nation’s total transmission infrastructure. To put this transmission deficiency In perspective, the contiguous US boasts over 700,000 circuitous miles of these lines. Furthermore, Puerto Rico, a US territory, has 2,478 miles , while Wyoming—a state with a population size comparable to Alaska—has 4,300 miles . This subpar transmission network hampers the integration of renewable energy sources and poses challenges for military installations in ensuring transmission contingencies to support critical national security missions. Moreover, there’s an urgent need for Congressional funding action. For example, despite having Congressional authorization for $384 million for the Southeast Alaska Intertie , which aims to connect Metlakatla through Skagway, the promised funds have not been authorized. Alaska’s grid modernization is not just about powering homes and lowering costs; it’s crucial for national security, economic growth, and future energy resilience that Alaskans deserve. Regardless of any metric, stating that there is a transmission need in Alaska is an understatement. Benefits:Alaska must upgrade its outdated territorial grid system to a modern, 21st-century standard, incorporating N-1 contingencies. This transformation is crucial for integrating renewables and other new energy sources. Bringing Alaska on par with the rest of the nation with a first-world transmission grid will reduce energy costs and enhance energy security, laying a self-reliant solid energy foundation for Alaska’s future. How Do We Get There? Strategies and Tactical Steps for Advancing Action Develop and create a State of Alaska Power Transmission Fund under AEA to promote, secure and establish federal authorization and appropriations funding to develop an additional 3000 miles of transmission corridor for Alaska to move Alaska from pre-territorial grid system to a grid system that ignites development and integrates renewables, displaces more expensive diesel generation reducing energy costs. Create a system that allows AIDEA, AEA, and Federal funding to develop, design, build, execute, and operate additional regional transmission sections and lengths under a unified plan. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:Alaska must exponentially increase its haphazard and subgrade transmission system if Alaska is to develop and maintain its economic viability. Federal funding for a State of Alaska Power Transmission Fund State of Alaska Power Transmission Fund will enable the State to develop other State Energy Plan action items. Creating a robust transmission network in the Railbelt and Coastal areas is essential for Alaska to prosper economically. This structured execution list to develop a State of Alaska Power Transmission Fund offers a clear roadmap of the proposed steps to promote the Action to lower the energy cost for Alaskans while providing the means and funding to transform the dire transmission situation as it exists within Alaska today.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 20 Action Detail Summary Pages STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.5: Establish and provide valuable energy planning and modeling metrics from State data sources, where available and requested (such as DMV electric vehicle registrations and Air Source Heat Pump (ASHP) installation) by individual communities. Background:Alaska community energy planning ensures a stable and sustainable energy future, providing the optimum lowest cost power over time. For community leaders, citizens, and utilities to effectively plan growth, demand, and evolving market conditions, specific metrics are required to guide decisions continuously and track progress. Further, Alaska already has many data sets available, although this information is not readily boiled down and packaged for usefulness for community decision-makers or is not widely known. There is a demand and need for community data and metrics to make wiser community energy decisions, to prepare and request grant funding, and to position communities for greater energy self-reliance, energy security, and ultimately to lower the cost of energy-heating, electricity, and transportation. Some key indicators and metrics could assist local energy planning and decision-makers in no priority order. 1. Energy Consumption:• Total energy consumed per sector (e.g., residential, commercial, industrial).• Per capita energy consumption.• Forecasted energy consumption due to market condition changes-shore power, industrial loads, beneficial electrification in heating and transportation sectors. 2. Energy Production:• Total energy produced from various sources (e.g., solar, wind, fossil fuels).• The capacity factor of energy-producing installations (how often they produce energy compared to their maximum potential). 3. Energy Efficiency:• Energy saved due to efficiency measures.• Forecasted energy efficiency savings due to energy efficiency measures 4. Energy Import/Export:• Amount and type of energy and units imported/exported to or from an Alaska community or utility. • Dependency percentages on external energy sources that can be improved with local or regional energy resources or transmission.• Forecasted energy dependence reduction with the forecasted increase in local or regional renewable energy production to include impacts from beneficial electrification in heating and electric transportation. 5. Renewable Energy:• Percentage of total energy derived from renewable sources.• Installed capacity and generation from each renewable source (e.g., solar, wind).• Forecasted installed capacity and generation from each renewable source. 6. Carbon Emissions:• Total carbon emissions from energy production.• Carbon intensity (carbon emissions per unit of energy produced).• Forecasted Carbon Emission reductions from new carbon free energy sources or due from transformation from fossil fuels to renewable energy from beneficial electrification.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 21 STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.5 (CONT.): Establish and provide valuable energy planning and modeling metrics from State data sources, where available and requested (such as DMV electric vehicle registrations and Air Source Heat Pump (ASHP) installation) by individual communities. 7. Economic Metrics:• Cost of energy production per unit.• Economic benefits of energy projects (jobs created, GDP impact).• Forecased savings over life cycle of new generation and economic quantification of other benefits-emission reductons, fuel savings, etc. 8. Energy Resilience and Reliability:• Duration and frequency of power outages.• Energy storage capacity.• Forecasted energy storage capacity needs and economic and ESG quantification of benefits. 9. Energy Transition Goals:• Targets for renewable energy adoption.• Reduction targets for carbon emissions.• Forecasts for transition goals with data to support transition initiatives 10. Energy Sales, volume by customer sector and price Information• Transparent and accurate information provides objective fuel alternative calculations for collaborative community decision-making.• Forecasted sales based on beneficial electrification, shorepower, industrial load growth, and converting interruptible sales to conditional firm power. 11. Overhead of utility costs • Overhead cost data for comparison between similarly sized utilities to determine and approve managerial efficiencies. 12. Infrastructure Health• Age, condition, and capacity of energy infrastructure (e.g., power plants, transmission lines).• Forecasted infrastructure replacement and upgrades with new technology that provides operational control benefits and improves grid security and resilience. 13. Electric Vehicle number and percentage of community vehicle stock• Estimated annual power demand and consumption• Forecasted loads in 1 to 5 years. 14. Electric Vehicle public level 2 and level 3 charging stations• Estimated annual power demand and consumption• Forecasted loads in 1 to 5 years. 15. Heat Pumps• Total Number of Air Source Heat Pump units in a community or utility, annual installation growth, and percentage breakdown of building and housing units by fuel source. • Forecasted loads in 1 to 5 years. 16. Shorepower Installations• Total number of units, annual sales, and peak demand• Forecasted loads in 1 to 5 years.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 22 Action Detail Summary Pages STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.5 (CONT.): Establish and provide valuable energy planning and modeling metrics from State data sources, where available and requested (such as DMV electric vehicle registrations and Air Source Heat Pump (ASHP) installation) by individual communities. There is a cost to producing, maintaining, and updating information. Therefore, a cost-benefit analysis would need to occur to determine the net value of each data metric. However, as data-driven decision makes progress and we mature Alaska community energy decision-making from black box data to transparent and open information scenario, data is required for planning, decision making and also enabling Alaska communities to be armed with data when competing against communities from other States in competitive federal infrastructure, energy, and emission reduction grants. Lastly, this recommendation does not include the requirement or decision bar that Alaska or communities must have perfect data or complete data to make decisions. Too much unuseful data or requirement to have impossible-to-achieve data has historically plagued some communities and energy decisions, or opposition will use stall-by-study tactics to impede energy development and transmission build-out required to elevate Alaska on an energy security level with the rest of the country. In other words, let us not fall into the trap that the enemy of good is the requirement for perfect or complete information. Benefits:Alaska can help make wise local energy planning decisions, forecasting demand and supply and using data to apply for grants and assistance requiring data-driven applications. All of these actions enable community leaders with utilities and public input to plan for a community’s energy needs while working toward the lowest energy cost. How Do We Get There? In general, “how we get there” is to support the recommendations from the Data Subcommittee of the AESTF with the insistence that the viewpoint, practical delivery, and service from data is customer-focused, being the Alaska community and decision-makers. Data should be “community customer-driven” and community-centric in its approach and philosophy of conducting and maintaining data to help and propel Alaskan communities using data in a practical and common sense approach to drive energy affordability, reliability, and resilience for Alaskans now and for the future. Establish a Data Department within the Alaska Energy Authority (AEA) with regulatory authority to request and receive data from any electrical utility in Alaska that is issued a Regulatory Commission of Alaska (RCA) Certificate of Public Convenience and Necessity (CPCN). Establish an energy data governance committee that is responsible for establishing minimum protocols for data collection, quality, storage, use, and access that is “customer focused” on delivering data to customers for practical and cost-effective decision-making that propels and not slows the development of energy projects, solutions, and transmission systems. Fund data capacity on a cost/benefit and the biggest bang for the buck approach to maximize data benefits at the lowest cost. Improve existing energy data and collect new, needed data. Consider that if a utility and/or community desires state support from PCE and grant applications, it volunteers to judiciously supply requested data as required to ensure maximum participation in the production and use of energy data for the benefit of all Alaskans. DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 23 STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.5 (CONT.): Establish and provide valuable energy planning and modeling metrics from State data sources, where available and requested (such as DMV electric vehicle registrations and Air Source Heat Pump (ASHP) installation) by individual communities. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation as suggested by the Data Subcommittee of the Alaska State Energy Task Force. Expected Results:The expected results from this roadmap are for the State funded AEA Data department, as suggested and articulated by the Data Subcommittee mission is to provide customer-relevant information, metrics, and data that assist Alaska communities and utilities in making practical and wise energy decisions that lower the cost of energy, provide energy security and increase resilience for Alaska communities and electrical utilities.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 24 Action Detail Summary Pages STRATEGY B-1: ALASKA POLICY RECOMMENDATIONS ACTION B-1.6: Recruit, Train, and Enhance Alaska workforce with technical training for advancing beneficial electrification to lower Alaska energy costs and sustain Alaska’s growing energy infrastructure. Background:Alaska has entered an unprecedented demand for apprentices and skilled electrical trade workers that are critically necessary to build out and achieve the required generation, transmission, distribution, storage, and commercial/residential wiring essential for Alaska to migrate from higher-cost fuel sources to lower-cost fuel sources. Various agencies, labor organizations, and contractors operate many training and apprenticeship programs to meet the training needs of Alaskans without an inventory of forecasted demand. When there’s a shortage of workers, it disrupts the balance of supply and demand. This scarcity means Alaskans must pay higher wages to attract the limited available labor. As companies spend more on recruitment and possibly higher wages, these increased costs inflate energy project costs and raise energy costs. Additionally, in energy generation and transmission systems, where contracts are awarded to the lowest bidder, companies must increase their bid amounts to cover the higher labor expenses and contingency risks in obtaining qualified employees to perform the work. This phenomenon can lead to higher prices for Alaska generation and transmission, construction delays, and potential quality declines. Worker shortages have immediate impacts; they ripple through the entire Alaska economy, driving up energy and transmission costs and potentially slowing growth. Benefits:Alaska can achieve its labor and workforce training requirements through a unity of effort with multi-year “forward planning” to engage Alaskans to successfully enter critical job skills in the electrical trades to build out the infrastructure needed to assist Alaskans in lowering the cost of energy with a self-reliant and local Alaskan workforce. With its unique challenges and vast geographic expanse, Alaska requires an innovative approach to workforce development, particularly in critical sectors like electrical trades. Meeting the state’s labor and workforce training needs necessitates a holistic, long-term strategy from secondary to post-secondary and trade schools. How Do We Get There? Conduct an objective Alaska inventory demand and forecasting for critical skilled jobs with a multi-year forecast and then develop a plan to recruit, train, and place Alaskans to meet Alaska’s needs for these critical skill sets. Calibrate and coordinate with Alaska Dept. of Labor, Intl. Brotherhood of Electrical Workers (IBEW), other organized labor, Alaska Vocational Technical Center (AVTEC), Associated General Contractor of Alaska (AGC) , Alaska Safety Alliance to optimize resources and coordinate together to maximize results to ensure that Alaska’s labor market has the skilled workers necessary to achieve results on time and on budget. Engage trades and secondary school systems in developing advanced secondary education, enabling a seamless transition from secondary education to successful building trades job placement. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:By harnessing Alaska’s own resources and prioritizing its people, especially the coastal and rural communities, the state can build a self-reliant workforce ready for its unique challenges and opportunities that are essential in helping Alaskans lower the cost of energy, producing energy generation, transmission, and energy security for our communities and maintaining grid resilience.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 25 STRATEGY B-2: STATE OF ALASKA COORDINATION WITH FEDERAL AGENCIES AND FEDERALLY RECOGNIZED TRIBES RECOMMENDATIONS ACTION B-2.1: Establish an Alaska/Federal Renewable Energy Policy Force to develop, collaborate, and prioritize State energy, plan, goals, and rights to optimally advance renewable energy transmission lines on federal lands. Background:The State of Alaska has the highest disparity of power costs from one community or region to another. Some of America’s highest-cost energy communities amplify that these communities are in the Tongass and Chugach Forests lands controlled by the US Department of Agriculture (USDA) US Forest Service (USFS). Currently, there is limited or no State input or consultive rights provided by the State of Alaska to affect the federal policies of the federal government in a collaborative and constructive dialogue that lowers the cost of energy for Alaskans and reduces emissions and other national goals of energy security and lessening dependence on fossil fuels. RS 2477 (Revised Statute 2477) refers to a provision in the Mining Act of 1866, which allowed for the construction of highways across public lands not reserved for public uses. In simple terms, RS 2477 granted a “right-of-way” to build roadways and transmission lines over public land that provide access to renewable energy project areas. Section 4407 of Public Law 109-59 (Section 4407) of a 2005 federal transportation funding bill refers to a Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU). SAFETEA-LU was a bill sponsored by the late Congressman Don Young and was signed into law by President George W. Bush in August 2005. Section 4407 provides as follows: Notwithstanding any other provision of law, the reciprocal rights-of-way and easements identified on the map numbered 92337 and dated June 15, 2005, were enacted into law. Section 4407 Rights of Way provides roadways and transmission line corridors over the Tongass National Forest, instrumental for the State of Alaska’s interests in providing access to renewable energy project areas and transmission lines. However, Tongass Forest Land Management Plans, Land Use Designations (LUD), and other federal regulations are at odds with the State exercising its rights. Benefits:The development of state policies and goals to negotiate and execute with federal agencies for developing cost-effective renewable energy and transmission lines on federal lands lowers energy costs for Alaskans while assisting federal agencies in meeting national clean energy goals through mutual State-Federal cooperation, respect, and understanding. How Do We Get There? Establish an Alaska-Federal Renewable Energy Working Group between the Governor’s Office, Attorney General, Alaska Energy Authority, Alaska Department Commissioners, the USDA Forest Service and US Dept. of Interior (DOI) landholding agencies, and the US Department of Energy (DOE) and USDA Rural Utilities Services officials that promote energy development in Alaska to find common ground to develop renewable energy projects and related transmission lines to collaboratively and successfully open up Alaska federal lands for Alaska renewable energy development and transmission execution. Utilize the creation of an Alaskan-Federal Renewable Energy working group to Develop, Draft, and Execute mutually approved agreements between the authority of the Governor and the Executive Orders of the President of the United States and initiate binding Congressional legislation and Alaska legislation as needed for asserting the State of Alaska consultive and input rights on the development of federal lands for the purpose of renewable energy development and transmission siting authorities. This collaboration aims to ensure Alaska’s consultative rights in renewable energy projects on federal lands and to shape necessary legislation.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 26 Action Detail Summary Pages ACTION B-2.1 (CONT.): Establish an Alaska/Federal Renewable Energy Policy Force to develop, collaborate, and prioritize State energy, plan, goals, and rights to optimally advance renewable energy transmission lines on federal lands. Seek, negotiate, and obtain through agreement or through initiated federal legislation State primacy on existing and potentially new renewable energy Power Site Classification Sites (PSC) found on federal lands in Alaska identified in established Bureau of Land Management Public Land Orders and aimed for greater access to these PSC for development. https://archive.org/details/powersiteclassif02geol/mode/2up Seek, negotiate, and obtain through agreement or through initiated federal legislation a Renewable Energy Land Use Designation (RELUD) and Transmission Line Land Use Designation(TLUD) that overlay and have priority over all other Land Use Designations in the Tongass and Chugach Forest Land Use Management Plans. Negotiate with federal agencies and obtain State Primacy over RS 2477. A component of actions to accomplish through an Alaska-Federal Renewable Energy working group is to gain State primacy and control all Alaska RS 2477 Rights of Way located on or near federal lands to facilitate access to and from renewable energy sources for development. Seek to have State primacy on all RS 2477 trails and roadways in Alaska located on federal lands to facilitate access to and from renewable energy sites for development. https://www.blm.gov/sites/default/files/docs/2022-05/PDF_AK_State_of_Alaska_RS2477_BLM_AK_RAC_May_2022_James_H_Walker.pdf Enlist support from the Alaska Congressional Delegation to introduce legislation to have Alaska and other affected States gain state primacy over RS 2477 Rights of Way located in their respective states. A component of actions to accomplish through an Alaska-Federal Renewable Energy working group is to gain State authority over Section 4407 easements in Southeast Alaska or near federal lands to facilitate access to and from renewable energy sources for development. These easements were created pursuant to a land exchange ratified by Congress in Section 4407 of a 2005 federal transportation funding bill. https://dot.alaska.gov/sereg/projects/sitka_katlianbayroad/assets/Section_4407_Easement.pdf Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:The State of Alaska, with careful and planned execution, can Advance and Promote Alaska’s renewable energy development with cooperation and support from the federal government to achieve national purposes while reducing the energy cost of Alaskans. The expected results will lower Alaska’s energy costs and reduce the dependency on imported fuels, using local Alaska land and energy resources. This structured execution list offers a clear roadmap of the proposed policy initiatives and steps to promote the coordinated and cooperative development of energy resources on federal lands to achieve lower costs and meet national goals for reducing emissions. STRATEGY B-2: STATE OF ALASKA COORDINATION WITH FEDERAL AGENCIES AND FEDERALLY RECOGNIZED TRIBES RECOMMENDATIONS DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 27 ACTION B-2.2: The State of Alaska partners and collaborates with Federally recognized Alaska Tribes and federal agencies to develop mutually beneficial Energy Development and Transmission/ Distribution to advance the State Energy Plan to lower the cost of energy. Background:Coastal Alaska communities are keen on lowering their energy, heating, and transportation costs through collaboration of State, Tribal, and federal resources. Federally Recognized Tribes actively explore energy solutions and are supported in tribal energy endeavors by federal resources. Tribal goals align with the broader Alaska state mission of making energy more affordable for all residents. Furthermore, many federally recognized tribes have designated staff working specifically on energy projects, often in collaboration with federal entities. By working together, the State of Alaska, Federally Recognized Tribes, and our shared Alaskan communities can assist the wider Alaskan population by cooperatively developing and sharing efficient energy solutions. This joint effort can enhance the creation, sharing, and use of energy across the State. Additionally, recent legislative changes in the Inflation Reduction Act actively seek to fund energy developments with tribal entities, which could provide lower-cost energy benefits and local energy resilience in many areas of Alaska. Federal agencies, specifically the US Department of Energy (DOE) and the US Department of Agriculture, Rural Utilities Services (USDA-RUS) have rural and tribal-centric programs that can advance the State of Alaska’s goals to develop energy infrastructure and reduce energy costs for Alaskans. Benefits:The State of Alaska, specific federal agencies, and federally recognized tribes have mutually shared goals to provide low-cost heating, electricity, and transportation to Alaskans and Alaskan communities. By identifying and sharing information, plans, and initiatives and then establishing a framework to cohesively advance energy generation, transmission, distribution, storage, and heating solutions, the State of Alaska, federal agencies, and Alaska Tribes can optimize resources and benefits to lower the cost of energy and increase energy security for Alaskans. How Do We Get There? Establish a working group of regional tribes interested in or working on energy solutions to lower the cost of energy with State of Alaska officials, Alaska Energy Authority (AEA), the Governor’s Office, and the Denali Commission. The working group would identify areas of mutual assistance to advance locally sustainable energy developments and transmission projects by strategically and tactically optimizing federal and tribal funds to achieve mutual energy goals of lower-cost and self-sustaining energy systems. Identify and attract federal tribal energy program participation, technical assistance, and financing to work with state agencies to streamline permitting, regulatory processing, and funding to advance projects and transmission to lower energy costs and provide community energy security. The US government has specific energy assistance programs for tribal entities to partner with the State of Alaska, Communities, and public/private developers of generation and transmission that work together with a unity of purpose and effort to assist in lowering the cost of energy for Alaskans. If deemed viable and valuable, create a Fed State Navigator role or duties assigned to an existing position to assist rural and tribal entities in navigating the State permitting processes to develop and construct local renewable energy and transmission projects using tribal and federal funding with State assistance. STRATEGY B-2: STATE OF ALASKA COORDINATION WITH FEDERAL AGENCIES AND FEDERALLY RECOGNIZED TRIBES RECOMMENDATIONS DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 28 Action Detail Summary Pages ACTION B-2.2 (CONT.): The State of Alaska partners and collaborates with Federally recognized Alaska Tribes and federal agencies to develop mutually beneficial Energy Development and Transmission/ Distribution to advance the State Energy Plan to lower the cost of energy. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:This Action item, with its implementation steps, offers a roadmap to gain common ground, synergies, and practical outcomes for Alaska communities with overlapping interests of federally recognized tribes to achieve the mutually beneficial goal of lowering the cost of energy for Alaskans. STRATEGY B-2: STATE OF ALASKA COORDINATION WITH FEDERAL AGENCIES AND FEDERALLY RECOGNIZED TRIBES RECOMMENDATIONS DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 29 STRATEGY B-3: ALASKA HYDROPOWER GENERATION RECOMMENDATIONS ACTION B-3.1: Foster, Support, and Assist Hydropower development and transmission in Alaska to lower energy costs, provide energy security, and spur economic growth, job creation, and prosperity for Alaska. Background:The foundation of Alaska’s most cost-effective energy lies in its legacy hydropower infrastructure, some of which dates back decades or even a century. With proper maintenance, these hydropower systems have a life expectancy of over 100 years. Once the hydropower project’s initial debts are settled, they yield consistent, renewable, and lowest-cost power, benefiting multiple generations of Alaskans and commerce today and well into the future. Historically, Alaska’s economic vitality is due directly to its hydropower assets. Whether the small local hydropower systems that powered early mining and fishing sectors or the subsidized projects like Bradley Lake and Snettisham Hydro and the hydropower investments from the era of the Four Dam Pool, these assets have consistently provided low-cost energy, driving Alaska’s prosperity. Both in Alaska and across the U.S., the National Hydropower industry is expanding to include river hydrokinetics, tidal, and marine power projects as hydropower projects. As these technologies evolve, Alaska’s extensive coastline and lengthy rivers — greater than all other states combined — position it to capitalize on these innovations and benefit from these advancements to provide energy security and lower the energy cost for Alaska. Today, hydropower accounts for 29% of Alaska’s electricity. This reliable power source underpins vital sectors of the Alaskan economy: mining, fisheries, military, and tourism, ensuring energy security and economic stability for the state. Benefits:Hydropower in Alaska is not just an energy source; it’s our Alaska energy DNA. Historically, hydropower has consistently delivered the state’s most affordable power. By investing in hydroelectric infrastructure, we’re not just tapping into a proven energy solution but securing Alaska’s energy future. This investment strategy, rooted in a track record over a century, offers unmatched cost-effectiveness in the long run and past most investment cycles. While the initial outlay is significant, the long lifecycle of hydropower — exceeding 100 years — ensures that Alaska is planting seeds for today’s needs and also reaping benefits for future generations with sustainable, clean energy. Investing in hydropower is our Alaska commitment to Alaska’s proven energy model, where hydropower assets exist for a brighter, more affordable, energy-secure future for Alaska. How Do We Get There? Evaluate and execute adaptive investment practices from the Bradley Lake and Four Dam Pool model and combine them with some of the prudent practices of BC Hydro to create a public-private State of Alaska corporation to develop, invest, own, and oversee operations of new hydropower facilities in Alaska. Provide and fund AEA the authority to identify and invest in regional hydropower and hydropower transmission and distribution assets for the public benefit. Encourage utilities to financially participate in ownership and long-term offtake arrangements to provide energy security and growth in service areas or to allow utilities to service new large industrial loads-mining and cruise industry shore power. Combine federal tax incentives, grants, and loan programs to optimize lower-cost financing and equity costs to lower the cost of power now and over the life of the assets. Establish a State of Alaska Power Fund to own and operate Alaska hydropower assets that can provide regional benefits.Establish State of Alaska administered and supervised investment mechanisms and equity ownership for utility, tribal, and local community investments, combining local equity with federal financing through existing or new federal programs.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 30 Action Detail Summary Pages STRATEGY B-3: ALASKA HYDROPOWER GENERATION RECOMMENDATIONS ACTION B-3.1 (CONT.): Foster, Support, and Assist Hydropower development and transmission in Alaska to lower energy costs, provide energy security, and spur economic growth, job creation, and prosperity for Alaska. Seek federal legislation to provide funding for a State of Alaska Power Fund to help Alaska provide energy security for Alaska military bases and installations for the benefit of Alaska support for Alaska-based military and Coast Guard operations for national security. Identify, support, and fund to build local and regional hydropower to serve Alaska communities and multiple transmission interconnected communities at economies of scale, providing lower-cost power. Alaska Energy Authority (AEA) and Alaska Industrial Development and Export Authority (AIDEA) financially support through existing programs and investments any executable-ready hydropower project (permitted/licensed, designed, economically feasible) that will provide lower-cost electricity over the project’s life. Identify, seek, and support the construction of hydropower assets to export power to provide economies of scale for hydropower projects to lower the energy cost for Alaskans by selling export power to finance and economically enhance a hydropower project’s economic viability. Develop and support economically and with regulatory approval intertie connections and transmission corridors to strategically place transmission to interconnect current and future transmission to provide transmission corridors to known and undeveloped hydropower locations. Establish a State/Federal Power board, through Congressional legislation, to cooperatively have the Federal government land owners actively assist the State of Alaska in developing hydropower assets on federal lands. Review, refine, and amend Sec. 42.45.350. Licensing for water-power development projects and enacting state regulatory control over small hydropower development with Alaska interdepartmental coordination to support hydropower projects with abbreviated regulatory permitting. Governors Office and AEA work with the Congressional delegation to craft legislation to ensure that FERC-exempt or state-licensed hydropower projects qualify for all eligible federal Production Tax Credits (PTC) and Investment Tax Credits (ITC). The Governor’s Office and AEA work with Alaska’s Congressional delegation to craft and support legislation identifying hydropower as a renewable carbon-free energy source for all federal legislative, regulatory, taxation, incentive, and national security purposes. AEA provides an option for Renewable Energy Credit (REC) participation through a statewide pool. This pooling approach aims to achieve economies of scale when selling RECs. By doing so, both state-owned and other hydropower projects can maximize the value of Alaska’s hydropower RECs. The ultimate goal is to reduce the cost of electricity for Alaskans. These action steps have statewide applicability for other regions of Alaska where critically important hydropower development assets exist. Implementation Timeline: This action item has a blend of Immediate for execution-ready hydropower and short-term, mid-term, and long-term tasks for hydropower in earlier analysis and development stages. Expected Results:This structured execution list offers a clear roadmap of the proposed steps to promote the Action to lower the energy cost for Alaskans for future generations.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 31 Background:Heat pumps are widely used in Northern Europe, with over 90% market penetration. They efficiently provide affordable heating even at temperatures as low as 13˚ F, lowering the costs in these arctic, subarctic, and temperate regions. Source EHPA-European Heat Pump Market and Statistics 2023 Several communities of Alaska are experiencing a significant transformation from more expensive fossil fuel heating sources to lower-cost heat pumps, saving Alaska households. Benefits:How can Alaskans and Alaskan communities capture the lessons learned from Northern Europe, Canada, and Maine in ensuring that Alaskans gain from these successes and promote the same opportunities to lower their energy costs and improve their quality of life by spending less of their income on home heating? How Do We Get There?Strategies and Tactical Steps for Advancing Heat Pump Adoption in Alaska:a. Collaborate Internationally: Partner with the European Heat Pump Association https://www.ehpa.org/ and the International Energy Administration Heat Pump Centre https://heatpumpingtechnologies.org/about/heat-pump-centre/ to leverage models and programs that have successfully increased heat pump adoption. Collaborate with Provinces of Canada that have heat pump adoption programs b. Collaborate with Maine State Housing Authority and Efficiency Maine to learn of their programs to adapt and adopt a tailored State of Alaska heat pump program with the following suggestions c. Homeowner Financing: Offer zero or low-interest loans to homeowners through AHFC and related programs, enabling Alaskans to transition to cost-effective heat pump heating systems. d. Business and Public Facility Financing: Provide zero or low-interest loans via AHFC and other state organizations for businesses, apartment complexes, schools, governmental buildings, and NGO facilities to adopt heat pumps. This effort aims to reduce heating expenses for these entities, ultimately benefiting Alaskans. e. Community Heating Solutions: Allocate funds for community District Heating projects that utilize heat pumps, further decreasing energy expenses for Alaskan residents. f. Have AHFC publish and adopt for use the Juneau Commission of Sustainability fuel price calculator to assist communities and individual households with their annual fuel savings and use the savings to assist in financing for heat pump purchase and installations https://juneau.org › wp-content › uploads › 2019 › 06 › jcos_fuel_price_calculator-.xlsx g. Bulk Purchasing: Collaborate with top manufacturers and suppliers to buy heat pumps in bulk, ensuring Alaskans receive a discounted rate and, consequently, more affordable heating solutions. h. Workforce Training: Invest in workforce development initiatives with Alaska’s trade unions and contractor associations. High-quality training ensures high-quality heat pump installations across Alaskan communities. STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.1: Integrate and Promote Heat Pump technology and systems (ASHP, SWHP, GSHP) as an Alternative Energy Resource in Coastal Alaska.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 32 Action Detail Summary Pages STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.1 (CONT.): Integrate and Promote Heat Pump technology and systems (ASHP, SWHP, GSHP) as an Alternative Energy Resource in Coastal Alaska. i. Public Education: Partner with Alaskan non-profits such as Alaska Heat Smart and tribal organizations with heat pump programs to educate the public about heat pump benefits. This includes offering building assessments for heat pump suitability and providing unbiased advice and recommendations. j. Utility Billing Integration: Obtain RCA authorization allowing electrical utilities to introduce on-bill financing. This lets Alaskans conveniently pay off their heat pump loans directly through their utility bills, streamlining the repayment process for consumers and AHFC alike. k. RPACE-Residential Property Assessed Clean Energy. Consider State adoption of a streamlined, easy-for-consumer RPACE program. USDOE best practice guidelines: https://www.energy.gov/sites/prod/files/2016/11/f34/best-practice-guidelines-RPACE.pdf l. Federal Support: Pursue federal aid and funding to bolster State of Alaska initiatives and community projects. This support will drive the widespread adoption of heat pumps, ultimately reducing energy costs for Alaskans. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:The State of Alaska, with careful and planned execution, can Advance and Promote Heat Pump technology and systems (ASHP, SWHP, GSHP) as an Alternative Energy Resource in Coastal Alaska that is tried and proven in other arctic, sub-arctic, and temperate locations. The expected results will lower Alaskan’s heating costs and reduce the dependency on imported fuels, creating demand for the development of local energy resources to displace imported fuels. This structured execution list offers a clear roadmap of the proposed steps to promote the adoption of heat pumps in Alaska to lower the cost of heating in Alaska.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 33 Background:Alaska set the standard for cruise ship shore power in Juneau, a model now global. This system benefits cruise lines financially, extends their stay in Alaskan ports, and fortifies our coastal grids. All modern cruise ships, including those being built today, are shore-power compatible. Seward and Whittier, with their utilities, are now developing these facilities. Efficient shore power involves precise transmission infrastructure, substations, and quick-connect equipment for cruise ships requiring 3MW to 8MW each. For perspective, Juneau’s Franklin dock, with full shore power utilization, recorded over 6,000 MWh in a single cruise season. Such infrastructure investments uplift not just the cruise sector they also bolster community resilience and present affordable energy alternatives, enhancing community energy reliability and assisting the State and communities to reduce the cost of power for Alaskans. Benefits:By spearheading shore power, Alaska boosts its grid reliability, attracts local energy investments, and showcases greener, emission-free ports—enhancing its global appeal. The Alaska shore power task and purpose propels job growth and infrastructure enhancement, supports industries, augments energy resilience, and slashes energy bills for its residents. How Do We Get There? Alaska Energy Authority (AEA) provides technical oversight and assistance to communities, Independent Power Producers (IPP’s), and local utilities to develop a shore power electrification plan to provide shore power at all cruise dock facilities in Alaska. AEA and Alaska Industrial Development and Export Authority (AIDEA) support public-private transmission, distribution, and generation investments to execute shore power in Alaska communities using state head tax funding distributed and accountable to AEA. Dept of Commerce and Community Development (DCCED) AEA, and the Regulatory Commission of Alaska (RCA) encourage communities to develop shore power planning for future-proofing generation and distribution infrastructure to meet current and future demand, fully utilizing Alaska generation and transmission resources. AEA/AIDEA Develop a technology term sheet and outline for communities using known and established Alaska and worldwide shore power engineering and infrastructure firms established with tried and proven late generation (automated quicker connect and disconnect times) shore power distribution, BESS, and shore-to-ship connection infrastructure. EPS-Anchorage, WABTEC Stemman Technik, and other late shore power generation systems. State of Alaska engage with Alaska’s congressional delegation to modify federal transportation statutes and programs to include and support cruise marine vessel port funding on par with freight ports. State of Alaska, AEA Establish and encourage cruise line industry participation and support in statewide shore power planning. AEA/AIDEA Support by encouraging and funding power generation projects that support firm power generation for cruise line shore power during cruise season and supply winter load power in the off-season to bolster local energy resilience and security. Identify legislative and regulatory modifications to support shore power installations in coastal communities to support economic development. State, DCCED, and private companies combine Alaska tourism marketing programs to incorporate Alaska’s strategy to shore power Alaskan ports to assist in marketing Alaska as a clean port state destination. STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.2: Plan, finance, and support the execution of Shore power at Public and Private Cruise Docks to Sell Excess Energy to Cruise Ships.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 34 Action Detail Summary Pages STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.2 (CONT.): Plan, finance, and support the execution of Shore power at Public and Private Cruise Docks to Sell Excess Energy to Cruise Ships. AEA provides engineering systems to assist with pre-engineer systems to the extent possible to reduce purchase costs, gain consistency in systems, and incorporate local Battery Energy Storage Systems to enable local utilities to ramp up and provide quick connect and disconnect times using proven late-generation technologies used in fast connecting ports worldwide. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:The State of Alaska has the potential to take a leadership role in shore power development by executing a carefully planned strategy. By focusing on shore power, Alaska can expand the demand for renewable energy. This increased demand can then stimulate further growth and construction of the state’s renewable energy sources. The ultimate goal is for Alaska to be recognized globally as a leader in shore power implementation. Successful results have multiple benefits: higher revenues for utilities, encouraging investment in the energy generation and distribution infrastructure, enhancement of the State’s energy resilience, reliability, and capacity, and decreasing energy costs for the residents of Alaska. Additionally, dock electrification resources could provide electrical delivery from ship to shore emergency power to communities in the event of natural disasters providing an energy security back up for distressed communities.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 35 STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.3: Beneficially electrify the Alaska Ferry Fleet to lower cost of transportation, and emmissions and assist in reducing the cost of power in coastal communities. Background:Alaska Department of Transportation & Public Facilities (DOT&PF) and Southeast Conference (SEC) are partnering to conduct a Low Emission Ferry Research project. Alternative fuel powered, low-emission, and electric ferries could be a game-changer for Alaska’s Marine Highway System, as DOT&PF starts to replace AMHS’s aging fleet in upcoming years. Fuel efficient ferries could increase the range and capacity of the fleet, potentially increasing service to communities and reducing AMHS operating costs. Benefits:How can Alaskans, Alaskan communities, utilities, and independent power producers work together or independently to finance, execute, and operate Battery Energy Storage System (BESS) to integrate additional power supplies, assist in serving cruise ships, and stabilize local and regional transmission and distribution grids. How Do We Get There? Strategies and Tactical Steps for Advancing Action• Refine shoreside energy storage system sizing for expected future vessel schedules.• Prepare site plans for each port where a shore-side charging BESS is beneficial to meet current and future charging demands. Consider: Permitting difficulties; Floating vs. Shoreside.• Investigate the capacity of available hydro power and impacts to the community where it is expected to be the primary source for powering electric ferries. Evaluate the impact to local power costs from periods of constricted supply when diesel power plants must be utilized to supplement or replace hydro power.• Develop benefit calculation for avoided greenhouse gas emissions due to use of electric ferry routes powered by greenhouse gas neutral-generation electricity.• During Low/No Emission port and BESS design, consider incorporating electric motor vehicle (National Electric Vehicle Infrastructure Program – NEVI) charging stations. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation.• 3-5 years to secure funding from IIJA and other sources for specific ferry replacement projects.• 5-10 years to complete design and construction of IIJA-financed vessels. Expected Results:• Lower carbon emissions compared to conventional diesel-mechanical engines.• Increased electric utility revenues from purchase of electricity by BESS.• Purchase of electricity at less than peak-rates for lower cost energy to AMHS ferries.• BESS supported microgrids in AMHS communities.• More reliable ferry service to AMHS communities. This structured execution list offers a clear roadmap of the proposed steps to promote the Action to lower the energy cost for Alaskans.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 36 Action Detail Summary Pages STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.4: Identify and support the colocation of industrial loads (e.g., data servers) with Alaska Hydropower facilities for synergies to lower energy costs. Background:Alaskan entities and government agencies built many legacy Alaska hydropower projects in Coastal Alaska to serve industrial loads. Many of the legacy hydropower assets of Juneau were developed, constructed, and operated by mining interests to power mills and lower the cost of mining. This tried and proven model of building hydropower to subscribe the generation output to large mines and other industrial loads provides economies of scale to finance large hydropower and transmission investments by creating economies of scale. The hydropower development history of Alaska and the colocation of industrial loads offer valuable lessons learned for Alaska as Alaska leans forward to increasing its energy security, and resilience and achieving lower-cost energy. These legacy hydroelectric facilities built in the past now provide the lowest-cost wholesale power in Alaska, proving the long-term investment model through providing long-term energy dividends in some cases for over 100 years. The large customer concept whereby a hydropower project serves the Alaska industrial base, be it a military installation, a mine, a fish processing plant, or future industries like data service centers or even transferring a power consumptive industry (ferries, cruise ships, trains-such as electrifying the Alaska railroad) from diesel to electric provides the opportunity to colocate industrial loads near hydropower generation that can provide firm and conditionally firm power to establish lynchpin industry and employment in Coastal and Alaskan communities situated with hydropower resources. This concept is a tried and proven Alaska energy model based on historical development. Today, the added benefit of producing clean power to meet Environmental, Social, and Governance (ESG) further compels the attraction of industry to use Alaska hydropower. ESG refers to the three central factors in measuring an investment’s sustainability and societal impact on a company or business. These criteria are increasingly becoming crucial to investment decisions, as many investors recognize the long-term importance of sustainable operations for business success. In the context of investing, Socially conscious investors evaluate and screen investments for sustainability and ethical considerations using ESG metrics. Companies with strong ESG profiles may be deemed more future-ready and less risky in facing regulatory or reputational challenges. Colocating industrial loads with clean hydropower can competitively assist the State and investing companies in reducing regulatory and reputational risks. Additionally, hydropower offers another product form that can generate revenues to lower costs of energy: cold water. The cold outtake water from a hydroelectric facility is valuable for circulating cooling water for data servers that require chilled rooms to operate efficiently. Colocating future data server operations at or near hydropower locations is a recent phenomenon that offers lower-cost energy to operate the data servers and reduces server chilling costs necessary to operate data server centers at peak efficiency. Indeed, large industrial loads such as mines, data server centers, fish processing and freezing operations, and other large energy-consumptive industries provide the requisite economies of scale to finance and build hydropower opportunities in Alaska but also invigorate clean industrial development that not only creates and sustains family wage jobs but also provides the trajectory to lower energy costs through economies of scale. Benefits:Strategically collocating large industries, such as mines, fish processing plants, military bases, and data centers, near hydropower facilities is a game-changer for Alaska. It offers a dual benefit: fostering economic growth and ensuring cost-effective, sustainable energy for Alaskans. By leveraging the enduring 100-year lifecycle of hydropower, which has the lowest cost over time, Alaska can capitalize on its historic model of harnessing hydropower to drive industrial growth. This symbiotic relationship boosts Alaska’s economic prosperity, creating jobs and opportunities and guarantees the most affordable power for its residents. DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 37 STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.4 (CONT.): Identify and support the colocation of industrial loads (e.g., data servers) with Alaska Hydropower facilities for synergies to lower energy costs. How Do We Get There? 1. Unified Policy Development :• Policy-making entities: Governor’s Office, Department of Commerce and Community Economic Development (DCCED), Alaska Industrial Development and Export Authority (AIDEA), and Alaska Energy Authority (AEA) can collaborate to devise a policy promoting the recruitment and facilitation of industrial load development in Alaska to mate with future hydroelectric development. This collaboration of policy can leverage the historically successful Alaskan energy model to achieve multiple and synergistic Alaska benefits: local economic prosperity, energy security, job creation, and long-term reductions in energy costs.2. Promotion of Long-term Hydropower Resources:• DCCED, AIDEA, AEA, and RCA should advocate and actively recruit for developing enduring hydropower resources, emphasizing their anchoring by industrial loads. Through strategic industrial colocation, hydropower, and related transmission, Alaska can harness the compounded benefits and ensure lower-cost energy for its residents throughout the century-long lifecycle of hydropower assets.3. Legislative Action for Industry Attraction:• The Alaska legislature should enact laws and regulations incentivizing industries to align with Alaska’s hydropower potential. Legislative action would underscore the vast economic advantages and clean energy outcomes resulting from maximizing the use of existing hydropower and fostering the creation of new hydropower projects within the State to advance the stated multiple and synergistic Alaska benefits that this initiative inspires.4. Assistance and cooperative support for local initiatives and developments• DCCED, AIDEA, AEA, and RCA assist local communities and hydropower developers in local initiatives and development of optimizing hydropower assets and industrial loads to provide synergistic Alaska benefits, including lowering the energy cost for Alaskans. Governors office, DCCED, AIDEA, and AEA, develop a policy that supports the recruitment and attraction of industrial load development in Alaska using this proven Alaska energy model for multiple beneficial purposes: prosperity, energy security, job creation, and long-term lower energy costs. DCCED, AIDEA, AEA, and RCA support the development of long-term hydropower resources anchored by industrial loads and colocation/transmission of hydropower to achieve the synergistic benefits and obtain lower-cost energy for Alaskans over the 100-year life cycle of hydropower assets. Alaska legislature enacts legislation to attract industry and support the colocation of Alaska industrial development to subscribe to new hydropower generation economically, recognizing the substantial economic prosperity and clean energy emissions benefits of fully subscribing to current hydropower and developing and constructing new hydropower in Alaska. Implementation Timeline: This action item has a blend of Immediate to long-term tasks for implementation. Expected Results:This proposed roadmap enables Alaska to tactically accelerate the positive development of new hydropower assets by strategically positioning and transmitting clean hydropower energy to industrial loads. The economies of scale of industrial sales assist hydropower in meeting economic viability while paying down the debt to offer the lowest cost power over time. This tried and proven Alaska hydropower/industrial load model can repeat itself as Alaska looks to develop the next tranche of hydropower assets to meet Alaska’s energy needs to propel economic prosperity and achieve lower-cost energy for Alaska’s current and future generations. DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 38 Action Detail Summary Pages STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.5: Identify, Assist, and fund Battery Energy Storage Systems (BESS) and other Energy Storage Systems (ESS) for successful integration into Coastal communities to increase energy security, increase grid resilience, and lower energy costs. Background:BESS/ESS technology has advanced to the point that indicates significant potential savings for communities that are dependent on diesel power generation for electrical needs. Some new supercapacitor systems boast 97% efficiency and estimate up to 75% savings in diesel fuel consumption to provide equivalent power using BESS/ESS. US DOD is looking at exploiting this technology in Alaska. Other utilities have deployed other BESS technologies and energy storage works, promising to stabilize Alaska grid networks and microgrids. There are several BESS demonstration projects currently being tested in Alaska. BESS technology provides a potential opportunity to significantly lower the cost of power generation in some rural and coastal Alaskan communities. Background on Battery Energy Storage System (BESS):1. Functionality: Simply, BESS stores electrical energy for use at a later time. BESS is especially important for integrating intermittent forms of renewable energy and immediately supplying large quantities of energy in seconds or minutes (supplying power to cruise ships) while stabilizing grid operations. 2. Components: A BESS typically includes the following: Batteries: These are the actual storage units and can be of various types, such as lithium-ion, lead-acid, flow batteries, etc. Power Electronics: This includes inverters and converters, which help transform electricity from AC to DC (and vice versa) and control the flow of electricity. Control Systems: These manage the BESS’s operations, ensuring it charges and discharges at the correct times and maintains optimal performance. Thermal Management Systems: Maintaining a stable temperature is crucial for battery longevity and safety. 3. Types of Batteries: The most common type used in modern BESS installations is the lithium-ion battery due to its high energy density, long cycle life, and decreasing costs. However, other types, like flow and solid-state batteries, are being researched and deployed for specific applications. Advantages of Battery Energy Storage Systems (BESS): 1. Grid Stability and Reliability: BESS can absorb or release power quickly, helping to stabilize grids, especially when there’s intermittent renewable generation like solar or wind, and is especially useful in turning on and off large periodic loads like cruise ships. 2. Peak Shaving: Batteries can be charged during off-peak hours when demand (and often cost) is low and then discharged during peak demand times. BESS helps utilities and consumers reduce costs and can prevent the need for firing up expensive and potentially polluting “peaker” power plants or forego electric sales waiting for ramp-up times from other sources. 3. Integration of Renewables: Batteries make it easier to integrate renewable energy sources by storing excess energy when it’s available and releasing it when needed.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 39 STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.5 (CONT.): Identify, Assist, and fund Battery Energy Storage Systems (BESS) and other Energy Storage Systems (ESS) for successful integration into Coastal communities to increase energy security , increase grid resilience, and lower energy costs. 4. Microgrids & Energy Independence: In areas with unreliable grid connections or no connection at all, BESS can form the backbone of Coastal community grids that can operate independently and withstand outages. 5. Reduced Transmission and Distribution Investment: By placing BESS at strategic locations, utilities can delay or avoid expensive upgrades to transmission and distribution infrastructure. 6. Load Leveling: By storing energy during periods of low demand and releasing it during high demand, BESS can help level out the demand curve, ensuring a consistent power supply and reducing stress on the grid. 7. Backup & Emergency Power: BESS can serve as an emergency power source during outages, ensuring continuity in critical facilities like hospitals. 8. Support for Electric Vehicle (EV) Charging: As EV adoption grows, BESS can ensure that rapid charging stations get the power they need without causing strain on the local grid. 9. Economic Benefits: With the suitable RCA regulatory structures in place, BESS operations can pay for themselves by providing various grid services, from frequency regulation to capacity services. 10. Environmental Benefits: BESS can significantly reduce greenhouse gas emissions by enabling more renewable energy integration and reducing the need for fossil fuel-based peaker plants. Benefits:How can Alaskans and Alaskan communities, utilities, and independent power producers work together or independently to finance, execute, and operate Battery Energy Storage System to integrate additional power supplies, assist in serving cruise ships, and stabilize local and regional transmission and distribution grids, while lowering energy costs and improving their quality of life by spending less of their income on home energy costs and promoting local economic development? How Do We Get There?Strategies and Tactical Steps for Advancing BESS/ESS Adoption in Alaska: a. Gather data from modeling and from existing BESS/ESS demonstration projects in Alaska to determine actual diesel fuel savings, and power reliability to meet demand, maintenance, and operation costs. b. Gather proven performance data from BESS projects to prove out cost-saving claims. c. Funding: Support local community efforts to access to Energy Improvement in Alaska to include rural or Remote Areas grants through the US Dept of Energy, Office of Clean Energy Demonstrations (OCED). d. PPP: Encourage rural/coastal communities to pursue innovative financing vehicles to attract public-private-partnerships (PPP) and investment. e. Public Facility Financing: Offer zero or low-interest loans to communities through AHFC and related programs for power generation to purchase and install BESS/ESS systems to improve reliability and lower energy costs.DRAFT PRIORITY B. COASTAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 40 Action Detail Summary Pages STRATEGY B-4: ALASKA MARKET INITIATIVES ACTION B-4.5 (CONT.): Identify, Assist, and fund Battery Energy Storage Systems (BESS) and other Energy Storage Systems (ESS) for successful integration into Coastal communities to increase energy security, increase grid resilience, and lower energy costs. f. Bulk Purchasing: Encourage local communities in regions to pursue discounted contracts with BESS/ESS providers for multiple unit purchases. g. Workforce Training: Invest in workforce development initiatives with Alaska’s trade unions and contractor associations. High-quality training ensures high-quality BESS/ESS operation and maintenance across Alaskan communities. Implementation Timeline: This action item has a blend of Immediate and short-term tasks for implementation. Expected Results:Alaska’s Energy Revolution with BESS/ESS• Strategic Approach: Alaska can effectively deploy BESS/ESS, a proven energy solution in similar climates.• Multiple Gains: This leads to reduced power costs, decreased fossil fuel use, full utilization of energy resources by saving energy surpluses when available, and lower Greenhouse Gas (GHG) emissions.• Power Stability: Enhances energy reliability throughout Alaska in both interconnected and stranded grid systems.• Coastal Advantages: Enables coastal areas to support cruise ships and port growth. In essence: With careful planning, Alaska can capitalize on BESS/ESS for cleaner, cheaper, and more resilient power, benefiting railbelt, rural, and coastal communities. This structured execution list offers a clear roadmap of the proposed steps to promote the adoption of BESS/ESS in Alaska to lower the cost of heating in Alaska and improve local energy security and grid resilience, helping communities achieve task force goals of Affordability, Reliability, and Resilience.DRAFT PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 41 Background:Due to the remote nature of many Alaskan communities, many rural Alaskan communities must generate their own power for electricity and heat. Rural power generation in many cases is from diesel fueled generators. This vastly increases the cost of power in rural Alaska. Infrastructure investments that may help lower the cost for some rural Alaskan villages are building transmission lines from the Railbelt utility system to local villages, between local villages, or between local villages and private or public sector anchor tenants to grow economies of scale. This would allow villages connected to other power grids to enjoy power costs comparable to Railbelt residents. Benefits:Alaskans, Alaskan communities, utilities, and independent power producers work together or independently to finance, construct, and maintain transmission infrastructure tied to the Railbelt or other grids to ensure remote/rural Alaskan communities enjoy similar cost of power as Railbelt residents. How Do We Get There?Strategies and Tactical Steps for Advancing Action• Identify the appropriate organization(s) that will oversee the development and construction of the grid. Task 1 is to ensure that all impacted parties are onboard, and that the organization has appropriate authority.• Coordination and cooperation between energy sources and requirements of an integrated grid.• Consolidate the variety of interconnection proposals that have been performed to date and select those most technically feasible.• Estimate greenhouse gas reductions, fuel savings, and other direct savings. • Assemble the team to recommend approaches to accomplish technically feasible alternatives i.e., segmented versus consolidated grid system. • Investigate alternative financing options, including direct state investment, allocation of PCE funds, federal & state grants, subsidized loans, and P3 opportunities. • Identify priorities that bring maximum and immediate return. The savings that can be applied to the balance of the project.• Evaluate opportunities to co-develop energy infrastructure with transportation and other infrastructure developments Implementation Timeline: • Within 1 year have the organization identified and established. • Within 2 years: Have a technically feasible alternative identified. Implement design and engineering. Identify the most likely funding sources and environmental requirements.• By year 3: Obtain necessary permits. Develop schedule for construction activities (define scope). Procure qualified contractors.• By year 5: Authorize construction. Establish operating guidelines and responsibilities. STRATEGY C-2: INFRASTRUCTURE INVESTMENT ACTION C-2.5: Fund and Construct Opportunities to Connect Rural Communities through Transmission Lines and Other Shared Energy Projects.DRAFT PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 42 Action Detail Summary Pages STRATEGY C-2: INFRASTRUCTURE INVESTMENT ACTION C-2.5 (CONT.): Fund and Construct Opportunities to Connect Rural Communities through Transmission Lines and Other Shared Energy Projects. Expected Results:• Fuel cost savings from reduced diesel dependency. • Greenhouse gas reductions. • Reliability and resiliency benefits. • Spur local economic development and employment. • Expanded opportunities for distributed renewable resources. • Reduced dependency on PCE (could funds be reallocated i.e., M&O). • Measure and demonstrate the project as a template for other regions DRAFT PRIORITY C. RURAL GENERATION, DISTRIBUTION, AND STORAGE STATE OF ALASKA STATEWIDE ENERGY MASTER PLAN DRAFT DELIBERATIVE Action Detail Summary Pages Appendix III - 43 Background:Due to the remote nature of many Alaskan communities, there is potential for loss of power (electric/heat) without awareness outside of the community. Power loss may also reduce or prevent the ability to communicate outside of the community, threatening public health and life safety during temperature or climate extremes. Power plant automation, remote sensing equipment or use of growing drone technology, data management and artificial intelligence, and other emerging technologies provide the ability to automatically or remotely to avoid power system failures or outages, and alert power providers with notice of a failure to focus and accelerate recovery and restoration efforts. Benefits:Alaskans, Alaskan communities, utilities, and independent power producers work together or independently to finance, execute, and operate plant automation, remote sensing technology, unmanned aerial systems, data-driven preventative maintenance programs and other grid modernization enhancements to ensure remote/rural Alaskan communities are able to avoid or recover from power failures as expeditiously as possible, while improving reliability and reducing operating costs. How Do We Get There?• Enhance communications infrastructure and reliability. For example, ensure all new power conductors incorporate a fiber optic data and communications line. • Enhance manually operated power plants with automation and remote monitoring and control operations including necessary communications infrastructure upgrades i.e. fiber optic and other platforms. Prioritize critical functions including remote black start, emergency stop, economic dispatch, video monitoring, and fuel system monitoring capabilities.• Incorporate automation, remote monitoring and control, computer based data collection and storage predictive and preventative maintenance platforms, and communications upgrades into all new or replacement power plant projects. Implementation Timeline:• Within 1 year identify pilot communities and develop a modernization framework for those communities. Identify currently automated rural communities and capture lessons learned and best practices for guidance and knowledge-sharing to advise and streamline pilot deployments.• Year 2 – Perform feasibility assessments, identify and select pilot communities or energy systems for modernization. Aggregate funding sources that can be allocated to selected projects to be undertaken by the producers and project partners. Identify adjacent opportunities for infrastructure enhancements to share the costs and benefits of grid modernization (automation of community water and sewer treatment facilities, for example).• Years 3-5 deploy grid modernization enhancements to pilot community/communities and document and refine the process to serve as a template for additional communities. Each implementation should be continuous from inception to completion. Expected Results:• Improved grid reliability.• Faster response and restoration times for outages.• Improved operating efficiencies.• Improved operations and maintenance of rural system to reduce preventable or catastrophic failures.• Improved communications platforms that can be co-purposed to meet other community needs• Provide opportunities to cost-share for other community infrastructure modernization initiatives. STRATEGY C-3: LOWER OPERATIONAL COSTS ACTION C-3.4: Grid modernization and automation DRAFT PRIORITY F. STATUTES AND REGULATIONS REFORM STATE OF ALASKA STATEWIDE ENERGY MASTER PLANDRAFT DELIBERATIVEAppendix III - 44 Action Detail Summary Pages Background:The RCA is responsible for regulation of public utilities and pipeline carriers in Alaska. Most of the statutes and regulations that govern RCA authority were developed during a period of time when the electrical generation and transmission utilities in Alaska generally operated islanded systems primarily built around baseload generation. However, as Alaska has grown and the technology for generation, transmission, and storage has advanced, the responsibilities of the RCA have grown more complex. The Alaska Energy Security Task Force (AESTF) did not conduct a review sufficient to be able to recommend a comprehensive overhaul of the statutes or regulations that govern the RCA. Anectodely, it is understood that there are some improvements that could be made to facilitate more efficient utility regulation. It is also understood that the RCA is evaluating its own process and regulations to identify potential efficiencies. However, the AESTF did find that within all expected scenarios, the RCA must be provided sufficient budgetary support to be able to attract and retain the highly skilled technical, legal, and administrative staff necessary to help adjudicate the complex and rapidly increasing pace of decisions that are necessary in today’s to support Alaska’s continued access to affordable, reliable, and resilient energy. Benefits:Provide enhanced regulatory support to better facilitate proposed recommendations of the AESTF. How Do We Get There?Executive branch collaborate with RCA to incorporate staff budgetary recommendations into 2024 operating budget. Implementation Timeline: 2024 Alaska operating budget. Expected Results:Reduced casefile processing time by a highly skilled RCA will support Alaska’s transition to a more integrated and technologically advanced energy utility landscape. STRATEGY F-1: PLACEHOLDER STRATEGY TO BE DETERMINED ACTION F-1.6: Provide budgetary support for the Regulatory Commission of Alaska (RCA). DRAFT 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 MEMORANDUM DATE: October 11, 2023 TO: Curtis W. Thayer, Executive Director THROUGH: Audrey Alstrom, Director – Renewable Energy and Energy Efficiency FROM: Josi Hartley, Program Manager SUBJECT: Electric Vehicle Program Update National Electric Vehicle Infrastructure (NEVI) Formula Program Background: The Bipartisan Infrastructure Law (BIL) established the National Electric Vehicle Infrastructure (NEVI) formula funding program, allocating $52 million to Alaska over the next five years to build EV charging stations along highway corridors to create a nationwide network of electric vehicle (EV) chargers. The primary goal of this federal program is to deploy EV charging stations and create an interconnected network that facilitates data collection, accessibility and reliability. In this initiative, the Alaska Energy Authority (AEA) has taken a leadership role as the state's primary agency responsible for EV planning and implementation. Additionally, the State of Alaska Department of Transportation and Public Facilities (DOT&PF) has been designated as the recipient of FHWA Title 23 funds and plays a pivotal role in administering the NEVI program. Collaboration among AEA, DOT&PF, and the Federal Highway Administration (FHWA) occurs through bi-monthly meetings, where they discuss progress and coordinate tasks and responsibilities within the NEVI program. Request for Applications: On March 1, 2023, the Alaska Energy Authority (AEA) issued a Request for Applications (RFA) with the aim of installing NEVI-compliant Electric Vehicle Supply Equipment (EVSE) at a maximum of 14 sites located along the Alaska Alternative Fuel Corridor (AFC) between Anchorage and Fairbanks. This specific segment of roadway is noteworthy for its heavy traffic, connecting Alaska's two largest cities and offering access to various communities, parks, and other attractions. The projects' scope encompasses a wide range of tasks, including design, construction, software and hardware installation, operations, maintenance, and reporting. The RFA acceptance window extended for 60 days, with applications scheduled for submission by May 1, 2023. AEA subsequently received 34 applications for the 14 priority sites along the AFC (Figure 1). Alaska Energy Authority Page 2 of 5 Figure 1. NEVI RFA Applications by Location In June 2023, the evaluation committee convened, consisting of members from AEA, DOT&PF, and Michael Baker International. The committee conducted an assessment of project applications to rank the most suitable sites along the corridor, subsequently creating a final prioritized project list. This ranking considered both the available funding and the distribution of projects along the Alaska Alternative Fuel Corridor (AFC). A visual depiction of the selected EV charging sites along the corridor is below in Figure 2. Figure 2. NEVI AFC Awards Alaska Energy Authority Page 3 of 5 AEA and DOT&PF announced the first round of awards at the Alaska Infrastructure Development Symposium at the Hotel Captain Cook on September 25, 2023. Projects were selected in nine Alaska communities for a total investment of $8 million this round. The $6.4 million in federal NEVI funding will be matched with $1.6 million from private entities selected to install, own and operate the new EV charging stations. Post Selection Activities: AEA will maintain a close collaboration with DOT&PF to oversee the Design and Construction phases for the chosen sites. Following the selection process, the next steps involve the creation of Contract Agreements. During the fourth quarter of 2023, DOT&PF and AEA will engage in site host agreements with the selected site hosts. Additionally, DOT&PF's environmental team will conduct the NEPA environmental review. Upon the conclusion of the NEPA process, the final design and construction phases will commence. Construction activities for the selected sites are projected to take place from April 2024 through October 2025. NEVI Plan: The NEVI program mandates that states annually submit a NEVI Implementation Plan (referred to as "The Plan") to the Joint Office of Energy and Transportation (The Joint Office) and the Federal Highway Administration. This plan serves as the guiding document that outlines and regulates programmatic activities, which encompass the construction of EV infrastructure, public outreach and education, labor and workforce development initiatives, and more. On July 31, 2023, AEA and DOT&PF submitted the FY24 NEVI Implementation Plan, and FHWA officially approved it on September 29, 2023. This approval for the FY24 plan grants AEA and DOT&PF access to an additional $11.2 million in funding for NEVI Program activities and construction. Department of Energy: Vehicle Technologies Office In November 2023, AEA, in collaboration with various partners, submitted an application to the Department of Energy (DOE) with the purpose of installing charging stations and conducting outreach in rural Alaska. The grant partners consist of DOT&PF, Ahtna Corporation, Launch Alaska, Alaska Municipal League, Yellowstone-Teton Clean Cities Coalition, and the Alaska Center for Energy and Power. AEA was chosen as the recipient of an award under this program, amounting to $1.67 million, with an additional $330,000 contributed from the state and partner sources as a match. The total project budget for this initiative stands at $2 million. AEA will begin work on this award in Q4 2024. Charging and Fueling Infrastructure (CFI) Discretionary Grant Program The Bipartisan Infrastructure Law (BIL) has established the Charging and Fueling Infrastructure (CFI) Discretionary Grant Program under the US Department of Transportation, making available a substantial $2.5 billion in funding over the course of five years to a diverse range of applicants. Alaska Energy Authority Page 4 of 5 A Notice of Funding Opportunity was unveiled on March 14, designating $700 million from fiscal years 2022 and 2023 for this funding round. This financial support is earmarked for the deployment of EV charging and other alternative vehicle-fueling infrastructure projects in publicly accessible locations within both urban and rural communities, as well as along designated Alternative Fuel Corridors (AFCs). The BIL allocates the CFI Program funding evenly into two grant categories: the Community Program with $350 million and the Corridor Program with an equal amount of $350 million. AEA and DOT&PF have joined forces to submit an application for this program. Their project seeks to implement EV charging infrastructure in coastal communities situated along the Marine Highway System. The announcement of selections for the CFI program is anticipated by the close of 2023. Volkswagen Settlement EVSE Sites In 2018, Alaska became a beneficiary of $8.125 million from the Volkswagen Environmental Mitigation Trust (Trust). With Trust funds, the Department of Energy (DOE) State Energy Program (SEP) funds, and private matching funds from site hosts, AEA is installing 15 fast chargers and eight level two electric vehicle (EV) chargers at nine stations connecting Seward and Homer to Healy. Installation of EV chargers began in 2021. Operational Sites: • Homer: AJ’s Old Town Steakhouse and Tavern • Anchorage: Dimond Center • Cantwell, Jack River Inn • Chugiak: Three Bears Alaska • Healy: Three Bears Alaska • Trapper Creek: Three Bears Alaska • Seward: Seward Chamber of Commerce • Soldotna: Custom Seafoods Sites Under Construction: • Cooper Landing: Grizzly Ridge Alaska Energy Authority Page 5 of 5 Current Statewide EV Ownership as of September 30, 2023 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 MEMORANDUM TO: Alaska Energy Authority Board THRU: Curtis. W. Thayer, Executive Director FROM: Conner Erickson, AEA Planning Manager DATE: October 13th, 2023 RE: Renewable Energy Fund (REF) Update REF Round 16 (FY2025) Update AEA issued its Round 16 Request for Applications (RFA) on June 29, 2023 with a corresponding deadline for applications on August 29, 2023. As of the deadline, AEA received 29 applications for an aggregate REF grant request of $39.5 million, yielding an average request of $1.3 million per application received. In AEA’s initial stage 1 review, which as required per REF regulation 3 AAC 107.635 considers the eligiblity (both project and applicant) and completeness of an applicaiton, only a single application was found to be ineligible or incomplete, as it was received after the deadline of 4 p.m. on August 29, 2023. Owing to the rejection of this single application, the overall grant request amount was also reduced correspondingly by the ineligible amount of $1.73 million, to $37.8 million for the remaining 28 applications. AEA has now entered its Stage 2: Economic and Technical Feasibility review of the 28 remaining applications. All 28 projects have been assigned a project manager who will conduct a thorough technical review of the applications. Northern Economics, Inc. was competitively procured as a third-party contracted economist to conduct cost-benefit analyses of the remaining 28 applications, which will be incorporated in the Stage 2 evaluations. A Reimbursable Services Agreement (RSA) has also been excecuted with the State of Alaska Department of Natural Resources (DNR), for a review of the applications and their potential impacts to State-owned land and related resources. As conducted during the Stage 2 evaluation, any applications which score less than 40 points during Stage 2 will not proceed onto Stage 3 and will be issued a notice of rejection. Those rejected applications are allowed to appeal the rejection, should the appeal be provided within 10 days of issuance of the notice. Additionally, should AEA determine during Stage 2 that an application is not technically or economically feasible, or does not provide sufficient public benefit, such an application may also be rejected, even if it were to score above the 40 point threshold. Alaska Energy Authority Page 2 of 4 Those applications which move onto Stage 3: Project Ranking will be ranked according to certain criteria including cost of energy, applicant matching funds, project readiness, and others. These ranked applications and then presented to the Renewable Energy Fund Advisory Commitee (REFAC), as required by statute, whereby the REFAC may concur or advise on changes to the ranking and/or funding amounts, or suggest programmatic changes for future rounds. Upon conferring with the REFAC, AEA will then transmit its final Round 16 funding recommendations to the Legislature, no later than 10 days after the first day of the regular legislative session. AEA’s recommendations are then reviewed by the Legistature and the Governor for funding consideration. Any and all funding for REF Round 16 projects is at a the full discretion of the Legislature, and concurrence by the Governor. Funding for Round 16 applications will be made available as of July 1, 2024, or whatever effective date the Legislature approves for the State capital budget appropriation, should a retroactivity clause to July 1st not be included. Per AEA’s REF Round 16 schuedle, as provided in the attached, the REFAC meeting is anticipated for January 9/10 with a transmittal of AEA’s final recommendations to the Legislature planned for January 17th. Please see the attached documents for a summary of the 28 applications as received for Round 16, in addition to the current REF Round 16 schedule. Attachments • Attachment A: Summary of Received REF Round 16 Applications • Attachment B: Current REF Round 16 Schedule Alaska Energy Authority Page 3 of 4 Attachment A: Summary of REF Round 16 Received Applications by Energy Region and Technology Type Round 16 Received Applications by Energy Region Energy Region No. of Applications REF Funds Requested ($) Bering Straits 1 4,000,000$ Bristol Bay 5 7,166,471$ Lower Yukon Kuskokwim 6 4,609,666$ Northwest Arctic 1 4,000,000$ Railbelt 10 10,370,514$ Southeast 4 5,661,724$ Yukon-Koyukuk/Upper Tanana 1 2,008,113$ Total 28 37,816,488$ Round 16 Received Applications by Technology Technology No. of Applications REF Funds Requested ($) Biomass 3 2,607,514$ Hydro 8 8,505,236$ Natural Gas 1 150,000$ Solar 9 17,166,182$ Storage 4 6,362,350$ Transmission 2 2,738,979$ Wind 1 286,227$ Total 28 37,816,488$ Alaska Energy Authority Page 4 of 4 Attachment B: REF Round 16 Schedule Estimated REF Timeline - Rd 16 Line No.Item Start End 22 Stage 2 Review: AEA staff, assign contracted economists, DNR (incl. summary and map)10/2/2023 11/10/2023 23 QA/QC Contracted Economists (as needed)11/10/2023 11/15/2023 24 QA/QC DNR submittals (as needed)11/10/2023 11/15/2023 25 Meetings to discuss stage 2/3 scoring w/ recommendations 11/10/2023 11/28/2023 26 Draft non-recommendation letters for stage 2/3 11/28/2023 12/1/2023 27 Notify applicants who did not pass Stage 2/3 11/28/2023 12/1/2023 28 Stage 2/3 appeals due - review, resolve, and respond to Stage 2/3 appeals as needed 12/11/2023 12/19/2023 29 Notifications sent to applicants who appealed 12/11/2023 12/19/2023 30 Finalize recommendations for Stage 4 12/19/2023 12/21/2023 31 Draft REFAC presentation 12/21/2023 12/28/2023 32 Send REFAC materials 1/2/2024 1/2/2024 33 REFAC Meeting (Jan)1/9/2024 1/10/2024 34 Generate Status Report 1/10/2024 1/17/2024 35 Post REF materials to website 1/17/2024 1/24/2024 36 Draft, approve, and send recommendation transmittal to Legislature 1/17/2024 1/24/2024 Award No Project Name DC Funding Perf. Period Beg Perf. Period ThruActions Since Last ReportEstimated Jobs Created Permanent Jobs Created 01432‐12 Tatitlek BFU 1,472,000.00 6/1/2013 6/30/2023 None15 201474‐09 Chalkytsik BFU (2) 517,500.00 6/16/2015 6/30/2023 None15 201485‐06 START Communities Technical Assistance 375,000.00 11/1/2015 6/30/2024 None2001492‐10 Beaver BFU 608,000.00 7/6/2016 9/30/2023 Extension in process5201500‐08 Bulk Fuel Operator Training 1,985,000.00 9/1/2016 9/30/2025 Additional Funding and Extend Period of Performance3001515‐09 Circuit Rider Program 1,425,000.00 1/1/2017 12/31/2024 Additional Funding and Extend Period of Performance3001516‐08 RPSU ‐ Maintenance & Improvement 748,776.00 10/1/2016 12/31/2024 None20 001523‐08 Miscellaneious Small M&I Projects 2,945,000.22 6/1/2017 12/31/2025 Additional Funding and Extend Period of Performance20 001525‐07 Training ‐ Advanced Power Plant Operators 872,514.00 8/15/2017 6/30/2023 None3001544‐06 Training ‐ Itinerant Electric Utility500,000.00 3/1/2018 12/31/2023 None3001548‐07 RPS Maintenance & Improvement Program‐Statewide 3,540,000.00 5/1/2018 12/31/2025 Additional Funding and Extend Period of Performance20 001551‐07 Venetie RPSU 2,250,000.00 5/1/2018 12/31/2025 None5201557‐03 Barge Headers and Fill Lines 3,976,820.00 10/1/2018 12/31/2024 None60 001571‐02 Nunapitchuk BF 3,522,546.00 8/15/2019 12/31/2023 None30 201574‐03 Nikolai RPSU 1,733,740.00 8/1/2019 12/31/2023 None5201575‐06 Nelson Lagoon ‐ RPSU 1,585,455.00 8/1/2019 12/31/2025 None5201576‐04 Rampart ‐ RPSU 1,733,740.00 8/1/2019 12/31/2024 None5201577‐05 Napaskiak ‐ RPSU 335,455.00 8/1/2019 12/31/2024 None26 201592‐03 Scammon Bay BFU 1,200,000.00 2/17/2020 12/31/2025Additional Funding and Extend Period of Performance (Readded to spreadsheet, prior end date 5/31/22)01600‐02 AEEE ‐ Village Energy Efficiency Program ‐ State875,000.00 6/15/2020 12/31/2023 None3001611‐02 AEA Data Library 100,000.00 9/1/2020 6/30/2024 Extend Period of Performance1001618‐01 Fivemile Creek Hydroelectric Project R2,R4 2,880,000.00 9/1/2020 6/30/2024 None65 201628‐02 DC Craig High School Biomass Project 440,417.00 11/1/2020 12/31/2023 None0201645‐01 O&M Manual Conversion & Training 75,000.00 4/1/2021 9/30/2023 None4001646‐01 Bulk Fuel Inventory and Assessment 1,230,000.00 4/1/2021 12/31/2025 None20 001647‐01 Port Heiden Phase 1 Distribution Upgrades 1,905,600.00 4/1/2021 12/31/2024 None8001666‐01 Littoral Power Systems Hydrokinetic Project 80,642.00 11/15/2021 3/31/2023 Extension in process1001704‐00 Chalkyitsik RPSU 200,000.00 10/1/2022 3/31/2024 None5201705‐01 Middle Kuskokwim Failure Mitigation Plan 200,000.00 10/1/2022 3/31/2024 None5201731‐00 Shungnak BFU 3,296,032.04 1/1/2023 3/31/2024 None60 301735‐00 Ruby Powerhouse Leveling 200,000.00 1/15/2023 12/31/2024 None5001761‐00 Tuluksak Bulk Fuel M&I 200,000.00 1/15/2023 12/31/2024 None5001767‐00 AVTEC Powerplant Lab Upgrade 250,000.00 1/1/2023 9/30/2024 None5001771‐00 Distribution System Inventory and Assessment ‐ Statewide 267,051.64 4/1/2023 12/31/2025 None7001784‐00 Power Plant Operator Training 225,000.00 7/1/2023 9/30/2025 Added to spreadsheet3001793‐00 Circle Emergency Powerhouse Repairs 320,000.00 6/1/2023 6/30/2024 Added to spreadsheet50Total Funding for Active DC Awards:44,071,289 Less Total Spending on Active DC Awards:(26,208,535) Total Funding Remaining on Active DC Awards:17,862,754 Active Denali Commission AwardsAs of 10/03/2023C:\Users\rgarrett\Desktop\Budgets Board Meeting\10.11.23 Active DC Awards1 OF 1 PAYMENTS RECEIVED LATE FEES RECEIVED INTEREST + LATE FEES ($318,328) $312 $53,167 16 TOTAL # OF PPF LOANS LOAN DASHBOARD REPORT For Board Meeting on 10/25/2023 AEA POWER PROJECT LOAN FUND FISCAL YEAR-TO-DATE LOAN PORTFOLIO ACTIVITY (07/01/2023 - 9/30/2023) LOAN ACTIVITY EARNINGS LOAN CATEGORY STARTING BALANCE FUNDS DISBURSED ENDING BALANCE INTEREST RECEIVED AEA Power Project Fund $26,927,747 $378,992 $26,988,410 $52,855 LOAN PROGRAM SUMMARY Outstanding Loans $26,988,410.37 Uncommitted Cash Balance $6,404,482.53 Loan Commitments $5,609,651.85 Total Loan Program $39,002,544.75 0 $0 0.000% TOTAL # OF DELINQUENT LOANS LOANS DELINQUENT AMOUNT ($) % OF DELINQUENT LOANS ($) TO PORTFOLIO BALANCE Page 1 TOTAL ($) $2,293,214 $397,854 $807,096 $13,637,030 $18,369,565 $2,087,803 $37,592,562 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 ALEUTIANS $2,293,214 - - 3 BRISTOL BAY $397,854 - - 1 LOWER YUKO- KUSKOKWIM $807,096 - - 2 RAILBELT $3,523,022 $5,119,508 $4,994,500 5 SOUTHEAST $18,369,565 - - 1 YUKON-KOYUKUK/U TANA $1,597,660 $490,144 - 4 TOTAL $26,988,410 $5,609,652 $4,994,500 16 AEA PPF LOANS BY PROJECT TYPE AEA PPF LOANS BY PROJECT TYPE - BALANCE (NEW & OUTSTANDING) PROJECT TYPE # OF PROJECTS PROJECT TYPE BALANCE DIESEL 5 HYDRO $21,913,483.65 HYDRO 4 SOLAR $11,002,999.79 SOLAR 3 TRANSMISSION $1,966,667.00 WIND 2 WIND $1,383,325.14 BIOMASS 1 DIESEL $1,258,101.85 TRANSMISSION 1 BIOMASS $67,984.79 Page 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 MEMORANDUM TO: Alaska Energy Authority Board THRU: Curtis. W. Thayer, Executive Director FROM: Conner Erickson, AEA Planning Manager DATE: October 11th, 2023 RE: Power Project Fund (PPF) Loan Program Update PPF Update PPF Loan Fund Recapitalization Request For FY2025, AEA has made a formal capital budget request of $25 million, to recapitalize the PPF loan fund. Assuredly, all existing applications with the Authority have been encumbered against the existing loan fund balance, securing their respective loan request amounts should they be approved. The current cash balance is effectively exhausted for use in funding of future loan applications. PPF Loans are a primary funding source for the development of renewable energy projects, and as required cost matching for many currently available federal programs which require the leveraging of local and private investment, including the realization of federal tax credits as made available via the Inflation Reduction Act. Capitalization of this fund is thus needed to meet the increase in loan applications. For historical perspective, the last capitalization of the PPF fund was via the purchase, by AIDEA, of select loans from AEA’s PPF loan portfolio in 2010. This AIDEA-funded capitalization was for $20.6 million. No capitalizations of the fund, via external sources, have since occurred. Please see attachment A for reference to the current balance of the PPF Loan Fund. Currently, there are two approved and active loans with loan proceeds availalble for further disbursements, with City of Galena and Peninsula Solar, LLC. Three loans are with AEA for review and undergoing due diligence. Of the three before AEA, a loan in the amount of $4,944,000, as requested by Ounalashka Chena Power, LLC is scheduled to go before the AEA Loan Commitee on October 11, 2023 for its review and approval. Subject to the Loan Committee’s approval, the loan will be on the agenda for the October 25, 2023 AEA Board of Directors meeting for their review and approval, as statutorily required with the loan amount exceeding $2 million. An AEA-Board approved loan in the amount $4,994,500 is undergoing legal review of the loan documents by the Borrower, CleanCapital. The Borrower had initially stated a closing date of September 2023, however, owing to ongoing discussions with the Borrower’s tax-equity investor, delays have occurred in the provision of execution-version documents. AEA stands ready to execute the documents upon its receipt from the Borrower and is hopeful that the loan documents will be signed in October 2023. Alaska Energy Authority Page 2 of 3 The second loan with AEA under review is with Alaska Renewables, LLC for $755,500. AEA anticipates this loan going before the Loan Commitee for its review at the end of October, ealy November. The third loan with AEA under review is with the City of Hughes. The City of Hughes is currently considering a potential withdraw of its loan application for $75,000 as it explores alternative other financing options. The current effective balance of the PPF loan fund is $630,000, which will not be sufficient to cover program expenses beyond FY2025. Attachments • Attachment A: Summary of PPF Loan Fund Balance Alaska Energy Authority Page 3 of 3 Attachment A: PPF Loan Balance Summary Cash Balance (as of 8/31/23)14,006,930.98$ PPF AIM -$ Ops AIM 3.45$ FY24 Budet Commitment (996,400.00)$ FY25 Budget Commitment (996,400.00)$ Adj. Cash Balance 12,014,134.43$ APPROVED LOANS - REMAINING COMMITTED DISBURSEMENTS (assuming Energy49 full draw) City of Galena 490,143.78$ Energy 49 LLC 4,994,500.00$ Peninsula Solar LLC 125,008.07$ TOTAL 5,609,651.85$ PENDING LOANS - COMMITTED - NOT APPROVED City of Hughes 75,000.00$ Makushin Geothermal 4,944,000.00$ Alaska Renewables 755,500.00$ TOTAL 5,774,500.00$ Undisbursed Commitments (Approved & Pending)11,384,151.85$ Uncommitted Cash Balance 629,982.58$ DATE DESCRIPTION TOPIC AND AUDIENCE IN-PERSON/VIRTUAL TEAM MEMBER October 10, 2023 Host Alaska Energy Security Task Force Meeting In-Person/Virtual Curtis W. Thayer October 5, 2023 Presenter AEA Infrastructure Update Presentation to Alaska Bankers Association Wells Fargo, Anchorage, AK Curtis W. Thayer October 3-5, 2023 Attendee/Host Alaska-Canada Wood Energy Conference Pipeline Training Center, Fairbanks, AK Sean Arcilla October 3, 2023 Host Alaska Energy Security Task Force Meeting In-Person/Virtual Curtis W. Thayer October 3, 2023 Attendee Atlantic Council: The Frontiers Project Meeting Dena’ina Civic and Convention Center, Anchorage, AK Audrey Alstrom, Jim Mendenhall, Curtis W. Thayer September 29, 2023 Co-Host/Attendee Chugach Drive Electric Anchorage Museum, Anchorage, AK Josi Hartley September 28, 2023 Presenter Alaska's Electric Vehicles (EV) Program to Society of American Military Engineers BP Energy Center, Anchorage, AK Josi Hartley September 27, 2023 Panelist Alaska Chamber Fall Forum Hilton Anchorage, Anchorage AK Curtis W. Thayer September 27, 2023 Presenter AEA Overview and Task Force Update Presentation to EPA Region 10 U.S. Courthouse and Federal Building, Anchorage, AK Curtis W. Thayer September 26, 2023 Exhibitor Alaska Grant Symposium (Expo -Style) hosted by Alaska’s Congressional Delegation Hotel Captain Cook, Anchorage, AK Karen Bell, Conner Erickson, Quinlan Harris, Jim Mendenhall, Dawn Molina, Ashley Streveler, Wendy Sturdivant September 25 and 27, 2023 Presenter/Speaker Alaska Infrastructure Development Symposium Hotel Captain Cook, Anchorage, AK Bryan Carey, Josi Hartley, Curtis W. Thayer September 21-22. 2023 Attendee NASEO-NARUC-NGA-NASUCA Western Regional Roundtable: Equity Considerations in Electricity Planning and Policy Denver, CO Audrey Alstrom September 19, 2023 Host Alaska Energy Security Task Force Meeting AEA Office (In-Person/Virtual) Anchorage AK Curtis W. Thayer September 13, 2023 Attendee Clean Transportation Leadership Roundtable The Lakefront Anchorage, Anchorage, AK Josi Hartley September 13, 2023 Host/Moderator/Speaker National Hydropower Association Alaska Regional Meeting Hotel Captain Cook, Anchorage, AK Audrey Alstrom, Karen Bell, Bryan Carey, Curtis W. Thayer September 7-8, 2023 Attendee/Speaker/Sponsor Alaska Wind Workshop, Dena’ina Civic and Convention Center, Anchorage, AK In-Person Sean Arcilla, Karen Bell, Quinlan Harris, Josi Hartley, Yosty Storms September 7, 2023 Media Inquiry Alaska National Electric Vehicle Infrastructure (NEVI) Awards, Madeleine Ngo, New York Email Brandy M. Dixon AEA COMMUNITY OUTREACH Last Updated on October 11, 2023 (6-Month Look Back) 813 W Northern Lights Blvd, Anchorage, AK 99503 • Phone: (907) 771-3000 Fax: (907) 771-3044 • Email: info@akenergyauthority.org • Website: akenergyauthority.org DATE DESCRIPTION TOPIC AND AUDIENCE IN-PERSON/VIRTUAL TEAM MEMBER September 7, 2023 Host Commercial Property Assessed Clean Energy and Resilience Workshop AEA Office (In-Person/Virtual) Anchorage AK Audrey Alstrom, Karen Bell, Josi Hartley, Ashley Streveler August 30, 2023 Media Interview Grid Resilience Formula Program Award, Jamie Diep, KBBI AM 890 Phone Curtis W. Thayer August 29, 2023 Attendee/Speaker Houston Solar Farm Ribbon Cutting Houston Solar Farm Site Houston, AK Brandy Dixon, Conner Erickson, Curtis W. Thayer August 29, 2023 Host Alaska Energy Security Task Force Meeting In-Person/Virtual Curtis W. Thayer August 28, 2023 Media Interview Aging Bulk Fuel Tanks, James Brooks, Alaska Beacon Phone Curtis W. Thayer Tim Sandstrom August 22, 2023 Attendee Alaska Utilities Working Group: Cook Inlet Gas Supply Poll Results Presentation Virtual Brandy M. Dixon August 21, 2023 Presenter AEA Overview Presentation to City of Seward In-Person Curtis W. Thayer August 21, 2023 Meeting United States Department of Agriculture Rural Utilities Service Assistant Administrator and Team In-Person Audrey Alstrom, Karen Bell, Conner Erickson, Tim Sandstrom, Curtis W. Thayer August 18, 2023 Staffed State of Alaska Exhibitor Booth Alaska State Fair Energy Day, Palmer Fair Grounds, Palmer, AK In-Person Brandy Dixon, Conner Erickson, James Mendenhall, Bill Price, Ashley Streveler, Karen Turner, Curtis W. Thayer August 16, 2023 Media Interview Grid Resilience Formula Program Award, Alan Bailey, Petroleum News Phone Curtis W. Thayer August 15, 2023 Presenter Renewable Energy Fund Round 16 and Alaska NEVI Plan, Alaska Municipal League, Office Hours Virtual Karen Bell Josi Hartley August 13, 2023 Attendee Renewable Energy Fair, Chena Hot Springs Resort, Fairbanks, AK Virtual Curtis W. Thayer August 11, 2023 Media Interview Grid Resilience Formula Program Award, Jack Barnwell, Fairbanks Daily-News-Miner Phone Curtis W. Thayer August 11, 2023 Media Interview Inflation Reduction Act, Riley Rogerson, Anchorage Daily News Phone Curtis W. Thayer August 8, 2023 Host Alaska Energy Security Task Force Meeting In-Person/Virtual Curtis W. Thayer July 18, 2023 Host Alaska Energy Security Task Force Meeting In-Person/Virtual Curtis W. Thayer July 17, 2023 Media Inquiry Follow Up: Special Section on Rural Energy, Tim Bradner, Mat-Su Valley Frontiersman Email Brandy M. Dixon July 14, 2023 Media Inquiry Special Section on Rural Energy, Tim Bradner, Mat-Su Valley Frontiersman Email Brandy M. Dixon July 12, 2023 Presenter Alaska EV Working Group Technical Session: NEVI Justice40 Benefits In-Person/Virtual Josi Hartley June 23, 2023 Media Inquiry AEA Update, Tim Bradner, Alaska Economic Report Phone Curtis W. Thayer June 27, 2023 Host Alaska Energy Security Task Force Meeting In-Person/Virtual Curtis W. Thayer June 23, 2023 Media Inquiry AEA Update, Tim Bradner, Alaska Economic Report Phone Brandy M. Dixon June 16, 2023 Attendee Alaska Utilities Working Group: Cook Inlet Gas Supply Study Presentation Preview In-Person/Virtual Brandy M. Dixon June 16, 2023 Attendee National Hydropower Association: 2023 Alaska Regional Meeting Steering Committee Call 4 Phone Brandy M. Dixon AEA Community Outreach Page 2 of 3 DATE DESCRIPTION TOPIC AND AUDIENCE IN-PERSON/VIRTUAL TEAM MEMBER June 15, 2023 Media Interview 2023 Alaska Sustainable Energy Conference, Amy Demboski, 650 KENI Phone Curtis W. Thayer June 14, 2023 Presenter Alaska NEVI Plan and Program Update Fairbanks Workshop In-Person/Virtual Josi Hartley June 14, 2023 Presenter Alaska NEVI Plan and Program Update Juneau Workshop In-Person/Virtual Josi Hartley June 13, 2023 Presenter Alaska NEVI Plan and Program Update Mat-Su Workshop In-Person/Virtual Josi Hartley June 13, 2023 Host Bradley Lake Hydroelectric Project Day Trip In-Person Curtis W. Thayer June 12, 2023 Presenter Alaska NEVI Plan and Program Update Anchorage Workshop In-Person/Virtual Josi Hartley June 12, 2023 Attendee Alaska Utilities Working Group: Cook Inlet Gas Supply Study Press Release Discussion In-Person/Virtual Brandy M. Dixon June 5-8, 2023 Attendee Alaska Power Association (APA) Federal Legislative Conference: Joined APA and the Railbelt Utility CEOs in several meetings with Alaska's Congressional Delegation and the United States Department of Energy Washington, DC Curtis W. Thayer June 2, 2023 Attendee National Hydropower Association: 2023 Alaska Regional Meeting Steering Committee Call 3 Phone Curtis W. Thayer Brandy M. Dixon May 25, 2023 Media Interview 2023 Alaska Sustainable Energy Conference, Amy Demboski, 650 KENI Phone Curtis W. Thayer May 22-25, 2023 Moderator/Panelist/Speaker 2023 Alaska Sustainable Energy Conference Dena’ina Civic and Convention Center, Anchorage, AK Audrey Alstrom, Justin Tuomi, Rebecca Cameron Dean, Tim Sandstrom, Curtis W. Thayer May 22-25, 2023 Exhibitor Booth 2023 Alaska Sustainable Energy Conference Dena’ina Civic and Convention Center, Anchorage, AK Brandy Dixon, Taylor Asher, Katherine Aubry, Jennifer Bertolini, Karen Bell, Bryan Carey, Cameron Dean, Conner Erickson, Rebecca Garrett, Josi Hartley, Khae Pasao, Daniela Patterson, Bill Price May 22, 2023 Host/Presenter Alaska EV Working Group Meeting In-Person/Virtual Josi Hartley May 22, 2023 Attendee National Hydropower Association: 2023 Alaska Regional Meeting Steering Committee Call 2 Phone Bryan Carey, Brandy M. Dixon May 18, 2023 Media Inquiry Alaska NEVI Request for Applications, Madeleine Ngo, The New York Times Email Audrey Alstrom, PE Josi Hartley May 11, 2023 Attendee National Hydropower Association: 2023 Alaska Regional Meeting Steering Committee Call 1 Phone Bryan Carey, PE Brandy M. Dixon May 9, 2023 Host with Lt. Governor Alaska Energy Security Task Force Meeting In-Person/Virtual Curtis W. Thayer May 4, 2023 Legislative Hearing AEA PCE Overview Presentation to House Energy Committee Virtual Curtis W. Thayer April 25, 2023 Host with Lt. Governor Alaska Energy Security Task Force Kickoff Meeting In-Person/Virtual Curtis W. Thayer April 21, 2023 Legislative Hearing AEA Capital Budget Presentation to House Finance Committee Virtual Curtis W. Thayer April 17, 2023 Presenter Alaska NEVI Plan Workshop in the Matanuska-Susitna Valley In-Person/Virtual Josi Hartley AEA Community Outreach Page 3 of 3 10/11/23, 11:22 AM Another power outage briefly impacts the Interior as GVEA prepares for winter | Local News | newsminer.com https://www.newsminer.com/news/local_news/another-power-outage-briefly-impacts-the-interior-as-gvea-prepares-for-winter/article_e3511dac-679f-11…1/3 https://www.newsminer.com/news/local_news/another-power-outage-briefly-impacts-the-interior-as-gvea-prepares- for-winter/article_e3511dac-679f-11ee-9807-ff0e10af119c.html Another power outage briefly impacts the Interior as GVEA prepares for winter Haley Lehman Oct 11, 2023 Golden Valley Electric Association responded to another power outage Tuesday morning while preparing for the winter season. Courtesy of GVEA GVEA crews work on a line in February 2023. Courtesy of GVEA 1 of 2 10/11/23, 11:22 AM Another power outage briefly impacts the Interior as GVEA prepares for winter | Local News | newsminer.com https://www.newsminer.com/news/local_news/another-power-outage-briefly-impacts-the-interior-as-gvea-prepares-for-winter/article_e3511dac-679f-11…2/3 GVEA experienced a trip on the Intertie for 15-minutes starting at 7:49 a.m. Tuesday that affected approximately 1,500 members, according to Meadow Bailey, director of marketing and public relations at GVEA. The trip occurred just south of Healy in the same location that the Alaska Intertie tripped Monday afternoon, which impacted over 23,000 people in the Interior. The effects of the trip Tuesday morning were not as widespread as they were Monday afternoon because less power was being transmitted on the Intertie from South Central Alaska. According to the Alaska Energy Authority, the Alaska Intertie transmission line is a 170 mile-long, 345 kilovolt transmission line that connects Healy with Anchorage. Bailey said that the Alaska Intertie is like a large extension cord that brings power to the Interior from south central Alaska. GVEA sent a helicopter patrol to inspect the Intertie and determine the cause of the power outages. Bailey said that the helicopter patrol found no damage to any infrastructure. 10/11/23, 11:22 AM Another power outage briefly impacts the Interior as GVEA prepares for winter | Local News | newsminer.com https://www.newsminer.com/news/local_news/another-power-outage-briefly-impacts-the-interior-as-gvea-prepares-for-winter/article_e3511dac-679f-11…3/3 Haley Lehman “It appears the trips on the inner tie were caused by heavy snow sticking to the lines,” Bailey said. “We expect this to continue as long as we have such warm temperatures and snow.” Bailey said that line crews work year-round to make necessary repairs and respond to outages. “Our right of way crews work as long as weather permits,” Bailey said. “They clear on a schedule, so they are regularly returning to right of ways on a strategic and systematic basis.” Right of way crews also respond to danger trees or hazard trees. The combination of warm temperatures and heavy snow load last winter caused snow to cling to branches and bend onto electric lines from outside of the right of way, Bailey said. She said those trees caused repeated outages so GVEA brought right of way crews back to clear during the winter to prevent outages. GVEA also performs seasonal maintenance and makes sure all equipment is ready for winter, Bailey said. Contact Haley Lehman at 907-459-7575 or by email at hlehman@newsminer.com. MORE INFORMATION Power restored after widespread outages impact Interior 10/11/23, 11:25 AM Power restored after widespread outages impact Interior | Local News | newsminer.com https://www.newsminer.com/news/local_news/power-restored-after-widespread-outages-impact-interior/article_d03c9820-66fc-11ee-b379-d3162555e…1/2 https://www.newsminer.com/news/local_news/power-restored-after-widespread-outages-impact- interior/article_d03c9820-66fc-11ee-b379-d3162555e270.html TOP STORY Power restored after widespread outages impact Interior Haley Lehman Oct 9, 2023 This screenshot of the outage map was taken at 3:15 p.m. Monday afternoon. Visit https://outage.gvea.com/ to see the current live map. News-Miner screenshot Golden Valley Electric Association restored power following a widespread power outage that impacted thousands of people in the Interior Monday afternoon. GVEA started back up generation and restored power to all GVEA customers impacted by the numerous power outages as of 4:45 p.m. Monday. 10/11/23, 11:25 AM Power restored after widespread outages impact Interior | Local News | newsminer.com https://www.newsminer.com/news/local_news/power-restored-after-widespread-outages-impact-interior/article_d03c9820-66fc-11ee-b379-d3162555e…2/2 Haley Lehman According to Meadow Bailey, director of marketing and public relations at GVEA, a trip on the Intertie caused widespread outages for one hour. As of 3:45 p.m. Monday, 50 power outages impacted 23,804 members in Fairbanks, North Pole, Cantwell, and Healy. “We don’t know the cause of today’s trip, but it then caused Healy Unit 2 to come off line,” Bailey said. “When the Intertie trips like this, it disrupts the flow of power from Southcentral, requiring GVEA to start other sources of generation and starting the generation takes time.” According to the Alaska Energy Authority, the Alaska Intertie transmission line is a 170 mile-long, 345 kilovolt transmission line that connects Healy with Anchorage. The Intertie leads to savings of over $70 million annually for GVEA customers, the AEA website stated. “The electricity that we receive up the Intertie is either hydro power from Bradley Lake, or natural gas generated power from southern utilities. Today, it was a mix of both,” Meadow said. “This electricity costs less, and has a lower carbon footprint than electricity that we can generate or purchase in the Interior.” Bailey said that GVEA was receiving a heavy load of electric power on the Intertie Monday afternoon, so the system stopped distributing electric power to prevent damage. The outages triggered BESS, the GVEA large battery in South Fairbanks, and the plants in Fairbanks and North Pole to aid in fully restoring electric service. Contact Haley Lehman at 907-459-7575 or by email at hlehman@newsminer.com. MORE INFORMATION Another power outage briefly impacts the Interior as GVEA prepares for winter 10/11/23, 11:23 AM ACEP study models effort for a decarbonized Railbelt | Local News | newsminer.com https://www.newsminer.com/news/local_news/acep-study-models-effort-for-a-decarbonized-railbelt/article_b587c5b2-5fc3-11ee-9285-379bf648b6ed.h…1/6 https://www.newsminer.com/news/local_news/acep-study-models-effort-for-a-decarbonized- railbelt/article_b587c5b2-5fc3-11ee-9285-379bf648b6ed.html ACEP study models effort for a decarbonized Railbelt Jack Barnwell Oct 2, 2023 Courtesy GVEA At just under 25 megawatts, Eva Creek is among the largest wind projects in Alaska and the first by a Railbelt utility. It is 14 miles from Healy. Courtesy GVEA It could be possible that trends such as the use of electric vehicles and heat pumps will expand across the Railbelt over the next 25 years, but several paths are still being modeled in a study conducted by the Alaska Center for Energy and Power at the University of Alaska Fairbanks. The Railbelt Decarbonization study aims to take a look at what pathways and tools Alaska utilities can do to reduce carbon emissions on the Railbelt without sacrificing reliable and affordable power. 10/11/23, 11:23 AM ACEP study models effort for a decarbonized Railbelt | Local News | newsminer.com https://www.newsminer.com/news/local_news/acep-study-models-effort-for-a-decarbonized-railbelt/article_b587c5b2-5fc3-11ee-9285-379bf648b6ed.h…2/6 Phylicia Cicilio and Jeremy VanderMeer, two of study’s researchers working for the Alaska Center for Power and Energy, provided an update Tuesday at the Westmark Hotel Gold Room. “The goal of this project is to quantify the economics and reliability implications of these scenarios and create invaluable information,” Cicilio, the lead researcher, said. “We are not predicting the future or saying this will happen. The study is still in its first phase, with a goal to examine the various technologies, grid transmission and economic modeling and the impact on rates. “These things are based on the data we have now and we should be talking about the impact as we move forward,” Cicilio said. “Situations are going to change, prices are going to change.” Cicilio’s update included information on electric vehicles, transmission and use of residential solar. The project includes input from a technical advisory group that includes engineers from the Railbelt utilities, including Golden Valley Electric Association, from the Alaska Energy Authority and other stakeholders. Cicilio said the study has settled on four scenarios following a public survey, including a high electrification that combines new wind, solar and tidal energy sources; and three scenarios that project moderate growth, each with their own mix of new energy sources. Cicilio said another goal was to model and reduce blackout risk in the event an energy source fails somewhere. 10/11/23, 11:23 AM ACEP study models effort for a decarbonized Railbelt | Local News | newsminer.com https://www.newsminer.com/news/local_news/acep-study-models-effort-for-a-decarbonized-railbelt/article_b587c5b2-5fc3-11ee-9285-379bf648b6ed.h…3/6 Saving infrastructure, she noted, might include a drop in the load on the system, creating pocketed blackouts instead of an entire collapse. Load is measured by demand on the system by all the people using it. Different scenarios All of the scenarios try to emphasize reliability, affordability and carbon reduction by 2050, said VanderMeer. “To get there, there are virtually unlimited options we could take to get there, some probably better and some probably not so good,” VanderMeer said. “We don’t know which path is the best way to get there, but we are limited in what pathways to take.” The study involves energy analyses from existing and planned energy facilities ranging from wind and solar projects to hydroelectric. One of the biggest challenges, he noted, was projecting the Railbelt’s energy needs over the next 25 years. “The load is going to change significantly and one of the biggest questions is what is that load going to do,” VanderMeer said. “In the past, Railbelt growth was pretty predictable but we’re starting to electrify things like heating and electric vehicles.” Other factors include the rate cost based on how much power will be needed and what infrastructure the grid needs to be resilient. “The questions we are trying to answer is what do you build between now and 2050,” VanderMeer. “There’s tons of options and you’ve got to know what and where to build it, how to run the system and what runs when.” Sources of power could include commercial and residential solar, advanced nuclear, wind, hydropower, a tidal power site and long-duration energy storage. Regardless of whatever option was being modeled, VanderMeer most will have some fossil fuel redundancy. 10/11/23, 11:23 AM ACEP study models effort for a decarbonized Railbelt | Local News | newsminer.com https://www.newsminer.com/news/local_news/acep-study-models-effort-for-a-decarbonized-railbelt/article_b587c5b2-5fc3-11ee-9285-379bf648b6ed.h…4/6 “There is going to be an additional cost to get rid of that last little bit of fuel,” VanderMeer said. Load analysis VanderMeer noted that measuring how and when demand on the grid determines what will make sense for system needs. The decarbonization study takes into account all three Railbelt regions, based in part on 292,035 commercial and residential buildings and nearly 500,000 vehicles that might rely on the system for winterization. Power demands outside an uptick in adoption of electric vehicles and heat pumps assume a 1% growth when factoring in moderate population growth. From there, he said that one of the models takes into account an increase in the use of electric vehicles and adoption of heat pumps. “We’re still very early in the electrification of a lot of things, it’s still very much a guess,” VanderMeer said. “A lot of things are changing between now and 2050, maybe it’s realistic, maybe not.” Using slightly aggressive forecasting, use of electric vehicles on the Railbelt could increase by nearly 70% by 2050. “This is a fuel transition technology where if a lot of people do it, there will be a tipping scale and a large shift … than other technologies,” Cicilio said. She added adoption rates are slower in Alaska because of the vehicles energy efficiency and demand in colder climates. 10/11/23, 11:23 AM ACEP study models effort for a decarbonized Railbelt | Local News | newsminer.com https://www.newsminer.com/news/local_news/acep-study-models-effort-for-a-decarbonized-railbelt/article_b587c5b2-5fc3-11ee-9285-379bf648b6ed.h…5/6 Steve Colt, another researcher on the decarbonization study, noted that the research on electric vehicles was pulled from across Alaska. “My observation is that we are just beginning to understand what it’s going to mean having a fleet of electric vehicles, but we have enough data to know it’s possible,” Colt said. “The question comes down to the cost and relative competitiveness of electric vehicles in cold places.” Adoption of heat pumps on the Railbelt lacks historical data, she said, and could only secure one Alaska-based model from a co-op that adopted them over a five year period. “We took their forecast and increased it to include all the Railbelt,” Cicilio said. She said the results took into account a 14.4% increase in adoption by 2050, but called the projection “the most iffy forecast we have due to the natural gas situation in the Cook Inlet.” Most homes in Anchorage utilize natural gas, but Cook Inlet’s supply of gas deposit reserves are uncertain as Hilcorp stated it cannot commit to new contracts. “If there is no new natural gas or becomes less affordable in the future, this heat pump forecast could change drastically,” Cicilio said. Power generation questions She noted that overall there will be challenges and opportunities. Any increase in demand will require more power generation during the winter months, and that comes with the challenge of what to do with the excess power in summer months when demand falls. Even at more moderate scenarios, both summer and winter loads could double, while an aggressive model forecasts nearly triple the amount on the Railbelt. “If you double your load, this has massive implications for power generation needs,” Cicilio said. “These are the types of conversations we want to encourage with utilities and boards.” ACEP’s full first phase report will be completed by January. For more information, visit tinyurl.com/4czcxzjy. 10/11/23, 11:23 AM ACEP study models effort for a decarbonized Railbelt | Local News | newsminer.com https://www.newsminer.com/news/local_news/acep-study-models-effort-for-a-decarbonized-railbelt/article_b587c5b2-5fc3-11ee-9285-379bf648b6ed.h…6/6 jbarnwell Contact reporter Jack Barnwell at 907-459-7587 or jbarnwell@newsminer.com. 10/11/23, 12:04 PM Plan for $330M energy storage project in Healy moves forward - Anchorage Daily News https://www.adn.com/business-economy/energy/2023/09/26/plan-for-330m-energy-storage-project-in-healy-moves-forward/1/6 Obituaries • Games • ADN Store • e-Edition • Sponsored Content • Promotions ADVERTISEMENT Energy Plan for $330M energy storage project in Healy moves forward By Alex DeMarban Updated: September 26, 2023 Published: September 26, 2023 Fog rolls past frosty trees near Healy on Oct. 23, 2016. (Loren Holmes / ADN) A $330 million energy storage project in Healy that could support renewables and help hold down electricity prices along the Alaska Railbelt moved closer to reality this month. The federal Department of Energy said that it has selected Westinghouse Electric Co. and eight other “long-duration energy storage” projects in the U.S. to potentially receive grants to help kickstart projects. Such projects can deliver more than 10 hours of electricity at a time, helping smooth out energy from fluctuating solar and wind installations. ADVERTISEMENT Alaska News • Politics • Opinions • Talk to us • Get our free newslettersSections 10/11/23, 12:04 PM Plan for $330M energy storage project in Healy moves forward - Anchorage Daily News https://www.adn.com/business-economy/energy/2023/09/26/plan-for-330m-energy-storage-project-in-healy-moves-forward/2/6 The selection opens up the possibility of Westinghouse receiving $50 million to launch a first phase. Westinghouse has proposed constructing the energy storage facility in Healy south of Fairbanks, at the site of a coal-fired power plant unit that’s set to be retired at the end of next year, officials familiar with the project said. The facility would rely on a large number of heated concrete blocks to store releasable energy, they said. The project will use a heat pump to draw electricity from the power grid and convert the electricity into heat stored in the inexpensive concrete blocks, the Energy Department said in a statement. The stored energy is converted back into electricity using a heat engine. A rendering of the proposal that Westinghouse posted on X, formerly Twitter, shows two long facilities housing the concrete blocks. It shows electrical lines tying into the system, among other project installations. ADVERTISEMENT Westinghouse Nuclear @WECNuclear ·Follow We are excited to announce that @ENERGY has selected us to deploy a 1.2 GWh utility-scale long-duration energy storage system in Alaska in support of planned wind power. Read more about the project & how our Pumped Thermal Energy Storage technology works: info.westinghousenuclear.com Westinghouse Long Duration Energy Storage Solution Selected for Depa… Westinghouse Electric Company announced today the Department of Energy has selected its project to deploy a 1.2 GWh utility-scale long-… 7:54 AM · Sep 22, 2023 132 Reply Share Read 7 replies 10/11/23, 12:04 PM Plan for $330M energy storage project in Healy moves forward - Anchorage Daily News https://www.adn.com/business-economy/energy/2023/09/26/plan-for-330m-energy-storage-project-in-healy-moves-forward/3/6 The Westinghouse project could provide enough stored energy to power about 2,000 homes for a month, said Meadow Bailey, a spokesperson with the Golden Valley Electric Association in Fairbanks. The project is in an early stage, but the utility is optimistic that it will work as planned, she said. The utility needs to add renewable power to its system and the stored energy can support that renewable power, she said. [Amid natural gas crunch, an Alaska utility asks to resurrect in-state gas pipeline] “This acts like a large battery, but it uses pumped thermal energy instead of battery technology,” she said. The project comes as utilities along the Railbelt from Fairbanks to Homer are looking for more renewable sources of power, and stored energy to support the renewables, to replace a looming shortage of Cook Inlet gas. Bailey said Westinghouse’s application was created with participation from Golden Valley Electric. She said the first phase focuses “on demonstrating the viability at utility-sized scale. Subsequent stages are focused on engineering, design and ultimately construction.” The full project, if tests show that power can be provided at a large scale, is expected to be built by 2028, she said. The project is one of nine selected across the U.S. to enter a period of award negotiations that could take a year, prior to a project entering a first phase, Department of Energy officials said in a call with reporters Monday. The selections are part of a $350 million Energy Department program announced last year to support demonstration projects for long-duration energy storage technology, they said. The money is part of the 2021 bipartisan Infrastructure Law. Westinghouse said in a statement to reporters that the project would support future wind power projects at Golden Valley Electric. Golden Valley is currently looking to add 150 megawatts of wind power to its system, Bailey said. It plans to select an independent power producer that would build a new wind project near Fairbanks. The utility would buy the wind power in part to lower electricity prices for its ratepayers. The energy storage system would be the largest, single-installation project of its kind in the U.S., providing 1.2 gigawatt-hours of power, Pennsylvania-based Westinghouse said in its statement. Officials with Westinghouse did not respond to a request for comment. [Developers set to flip switch at Alaska’s largest solar farm] Golden Valley Electric has not committed to investing in the project, Bailey said. It is interested in pursuing a power purchase agreement with Westinghouse if the project works as intended, she said. ADVERTISEMENT 10/11/23, 12:04 PM Plan for $330M energy storage project in Healy moves forward - Anchorage Daily News https://www.adn.com/business-economy/energy/2023/09/26/plan-for-330m-energy-storage-project-in-healy-moves-forward/4/6 The project will reduce carbon emissions, expand the benefits of wind power, and demonstrate the value of heat-dependent energy storage in a cold climate, the Department of Energy said. ADVERTISEMENT Gwen Holdmann, senior researcher at the Alaska Center for Energy and Power, said the system is a “potential game-changer” in Alaska because it’s significantly larger than any energy storage system on the Railbelt grid. She said the materials proposed for the project are environmentally friendly, so it has benefits over other energy storage projects made with materials such as lithium. “It’s enabling meaningful, long-term duration storage in ways that don’t require lithium or cadmium, these (materials) that need to be mined and create long-term disposal issues,” she said. “This is simple, locally sourced material, and that’s exciting as a broader strategy for energy storage in the future.” Gov. Mike Dunleavy said the project will help Alaska better utilize its renewable resources. “Having an effective and affordable way to store energy has been the choke point for renewable energy technology,” Dunleavy said. John Burns, president of Golden Valley Electric, said the cooperative is focused on providing members with low-cost power, while reducing emissions. “We are excited about the potential of long-duration energy storage and the role it can play in integrating renewable energy not only in Interior Alaska, but the rest of the Railbelt electric system which serves over 80% of Alaska’s population,” he said in the Westinghouse statement. Houston Contracting Co. would lead construction of the project along with a subsidiary of Arctic Slope Regional Corp., an Alaska Native corporation, the Energy Department said. Do you have additional ideas for coverage on this topic? Do you have questions? Do you see an error? What's missing? Are you involved in the stor y or affected by it and have additional thoughts about it? Let us know here. Do you have additional ideas for coverage on this topic? Do you have questions? Do you see an error? 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Please don't publish my name I am over 16 years old I accept the Terms of Service Submit Powered by Hearken | Terms of Service | Privacy Policy Alex DeMarban CleanCapital Announces the Completion of Alaska’s Largest Solar Project https://www.nacleanenergy.com/solar/cleancapital-announces-the-completion-of-alaska-s-largest-solar-project 1/3 CleanCapital Announces the Completion of Alaska’s Largest Solar Project 26 Sep 2023 CleanCapital, a diversified clean energy company, announced the addition of an 8.5 megawatt (MW) solar project in Houston, Alaska to its operating portfolio. The solar project—the largest ever built in the state—was developed and constructed by Renewable IPP (RIPP), an Alaska-based solar developer. CleanCapital provided financing for the project construction and serves as the long-term owner-operator of the site. In addition to construction financing, CleanCapital’s investment funded RIPP’s operations to accelerate the development of its pipeline in Alaska. CleanCapital Announces the Completion of Alaska’s Largest Solar Project https://www.nacleanenergy.com/solar/cleancapital-announces-the-completion-of-alaska-s-largest-solar-project 2/3 The solar farm, built on ‘raw’ land, was designed to minimize disturbance to the soil and vegetation. Unique features include a focus on land preservation and an engineering approach to handle Alaska’s extreme weather conditions. Affordable Wire Management (AWM) implemented an above ground wire strategy, with rugged metal cable hangers engineered to withstand corrosive environments and intense ice and snow loads. Matanuska Electric Association (MEA) will purchase cost-competitive power from the project to benefit its members. The project was also supported by a loan from the Alaska Energy Authority (AEA). “Since its inception, CleanCapital has been driven by a mission to accelerate the transition from fossil fuels to clean, renewable energy. I cannot imagine a better illustration of the importance of that mission than bringing solar to an oil and gas-centric state where the impacts of climate change are so vividly felt,” stated Thomas Byrne, CEO at CleanCapital. “This project demonstrates the viability and economic rationale for adopting solar in Alaska, and we are proud to have played a role in building such a historic project.” While oil and natural gas are central to Alaska’s economy and remain Alaska's primary energy sources, residents and state leaders alike recognize the need to diversify the state’s energy generation. Today, 70%-80% of South-Central Alaska’s power and most of its heat is generated using a single source: Cook Inlet natural gas. Cook Inlet natural gas producers have cautioned about depleting resources, and importing natural gas would further increase the region’s high energy costs. Until now, the state had not built wind or solar projects at the scale needed to help the state meet its diversification and energy supply needs. The Houston solar project will help lead the way to a CleanCapital Announces the Completion of Alaska’s Largest Solar Project https://www.nacleanenergy.com/solar/cleancapital-announces-the-completion-of-alaska-s-largest-solar-project 3/3 new energy mix within the state while providing lower-cost energy to the local community of the Matanuska-Susitna Valley. “We are thrilled at the cohesive partnerships formed among RIPP, CleanCapital, AEA, and MEA that resulted in the completion of this historic solar project,” said Jennifer Miller, CEO at Renewable IPP. “We took special care and consideration when constructing this project to take full advantage of the unique location and combat the typical challenges of bringing renewables to Alaska. This project is the largest of its kind in the state and we aim to continue developing cost competitive renewable energy projects to shore up Alaska’s energy supply and suppress energy prices for residents and local businesses.” “MEA is excited to partner with Renewable IPP to expand the amount of clean energy on our system,” said Tony Izzo, Chief Executive Officer of Matanuska Electric Association. “Member surveys indicate people want MEA to produce more power with renewable energy, but not at an additional cost. We believe this project achieves that goal while helping MEA responsibly meet the board's clean energy targets.” CleanCapital is focused on investing in early-stage development, new construction, and operating solar and energy storage projects as well as partnering with developers to foster future pipeline opportunities. For more information about solar and storage financing solutions, visit https://cleancapital.com/project-acquisition/ why-cleancapital/. CleanCapital | https://cleancapital.com/ 10/11/23, 11:40 AM GVEA, Westinghouse receive funding for energy storage project | Local News | newsminer.com https://www.newsminer.com/news/local_news/gvea-westinghouse-receive-funding-for-energy-storage-project/article_e31123c8-59a3-11ee-865d-1f6cb…1/3 https://www.newsminer.com/news/local_news/gvea-westinghouse-receive-funding-for-energy-storage- project/article_e31123c8-59a3-11ee-865d-1f6cba8b9767.html GVEA, Westinghouse receive funding for energy storage project Jack Barnwell Sep 25, 2023 Golden Valley Electric Association, in partnership with Westinghouse Electric Company and Echogen, are set to receive funding for a major long-duration energy storage project to be built in Healy, according to an announcement from the U.S. Department of Energy. The project will utilize Pumped Thermal Energy Storage (PTES) technology “to assist in local and regional grid resiliency and stability, regional carbon footprint reduction, and improved reliability of electricity in Alaska’s Railbelt region, while demonstrating LDES’s support of renewable energy.” The project would store and provide up to 1.2 gigawatt-hours of power, enough to provide power for 10 hours or more during a systemwide outage. GVEA Golden Valley Electric Association is retiring Healy No. 2, Alaska’s largest coal plant. GVEA 1 of 2 10/11/23, 11:40 AM GVEA, Westinghouse receive funding for energy storage project | Local News | newsminer.com https://www.newsminer.com/news/local_news/gvea-westinghouse-receive-funding-for-energy-storage-project/article_e31123c8-59a3-11ee-865d-1f6cb…2/3 “We are excited about the potential of long duration energy storage and the role it can play in integrating renewable energy not only in Interior Alaska, but the rest of the Railbelt electric system which serves over 80% of Alaska’s population,” said John Burns, GVEA’s president and chief executive officer. “As a not-for-profit cooperative, GVEA’s focus is on providing its members with low-cost and reliable power, while reducing emissions.” In a prepared statement, Gov. Mike Duleavy called the project a major milestone for affordable energy in Interior Alaska. “Having an effective and affordable way to store energy has been the choke point for renewable energy technology,” Dunleavy said. “By providing long-duration energy storage, this project will help enable us to better utilize the renewable resources that are abundant in Alaska.” The new project builds on GVEA’s strategic generation plan adopted by the utility’s board of directors in June 2022. The plan called for investment in a large-scale wind energy project and replacement of its 21-year-old battery energy storage system (BESS). Meadow Bailey, GVEA’s director of external affairs and public relations, said Friday that the total project will cost $330 million. “The Department of Energy grant is for $50 million and is aimed at the demonstration and deployment of Long Duration Energy Storage (LDES) technologies, with the first funding phase intended to demonstrate the viability of technology’s use at utility size scale (100+ MW),” Bailey said. The project will be built in phases, Bailey said, with the first phase demonstrating its viability. “Subsequent stages are focused on engineering, design and ultimately construction. Assuming the technology proves viable at utility scale, Westinghouse advises an LDES project would be complete by 2028,” Bailey said. She added the new project will not replace the existing BESS and will continue using it until it is no longer beneficial. “Although aged and not designed to support variable energy resources, the BESS continues to provide significant benefits and reduces outages and costs to members each year,” Bailey said. “Although the current BESS is in need of replacement, GVEA is separately exploring a variety of 10/11/23, 11:40 AM GVEA, Westinghouse receive funding for energy storage project | Local News | newsminer.com https://www.newsminer.com/news/local_news/gvea-westinghouse-receive-funding-for-energy-storage-project/article_e31123c8-59a3-11ee-865d-1f6cb…3/3 jbarnwell options for that effort, however, the LDES demonstration project is not intended as a replacement of BESS.” Both the long-duration energy storage project and wind farm are among the assets that will replace GVEA’s coal-fired Healy Unit No. 2 power plant. The 60-megawatt facility was originally built by the Alaska Industrial Development and Export Authority in 1998 as a demonstration project for the DOE’s Clean Coal Technology Program and was later acquired by GVEA. However, the plant has faced numerous challenges and shutdowns since it went into commercial operation in 2018 and was selected by GVEA’s board to shut down over the 50-year-old Healy No. 1 plant. According to Westinghouse, the long-duration thermal storage technology provides an advantage over similar systems such as lithium-ion batteries. A thermal storage system can provide “10 or more hours of reliable energy storage with a simple, safe, cost-effective design in a compact footprint, delivering the lowest levelized cost of storage when paired with wind or solar.” GVEA’s goal for a large-scale wind project continues to progress, Bailey said. The utility closed its bid process on Aug. 3 and “GVEA created a short-list of potential vendors from the RFP, has notified those companies, and is currently in the process of selecting the final project.” Contact reporter Jack Barnwell at 907-459-7587 or jbarnwell@newsminer.com. PRESS RELEASE Brandy M. Dixon Communications Director (907) 771-3078 FOR IMMEDIATE RELEASE September 25, 2023 AEA and DOT&PF Announce First Round of Alaska NEVI Funding (Anchorage) — Today at the Alaska Infrastructure Development Symposium, the Alaska Energy Authority (AEA) and the Alaska Department of Transportation and Public Facilities (DOT&PF) announced their first round of awards for National Electric Vehicle Infrastructure (NEVI) funding. AEA and DOT&PF selected projects in nine Alaskan communities for a total investment of $8 million in this round. The $6.4 million in NEVI funding will be matched with $1.6 million from private entities selected to install, own, and operate the new electric vehicle (EV) charging stations. The first-of-its-kind NEVI funding is a result of the Infrastructure Investment and Jobs Act, which provides funding to states to deploy EV charging infrastructure along public roads to establish an interconnected network across the state and nation. For fiscal years 2022-2027, Alaska will receive over $52 million. “We are thrilled to be among the first six states in the nation to issue these NEVI awards,” said AEA Executive Director Curtis W. Thayer. “AEA is committed to supporting EV adoption with better access to EV charging infrastructure. This investment enables us to provide convenient, reliable, and affordable access to EV charging infrastructure in ways that couldn’t be achieved previously.” “Alaskans are leaders in innovation and resiliency,” said DOT&PF Commissioner Ryan Anderson, P.E. “DOT&PF and AEA are pleased to support our communities' relentless pursuit of affordable and sustainable energy in Alaska.” “In Alaska and across the country, President Biden’s Investing in America agenda is building the backbone of our national network of EV charging stations that will ensure a seamless experience for drivers when they’re charging up – similar payment systems, clear pricing information, interoperable connector types, and reliable charging speeds as we make the historic transition to electric vehicles,” said Federal Highway Administrator Shailen Bhatt. “With federal investments made possible by the Bipartisan Infrastructure Law, Alaska is taking a critical step forward as States across our nation begin deploying EV chargers for the communities they serve, and we are proud to partner with them in this shared project.” The initial focus of this funding, Phase One, is to build out Alaska’s Alternative Fuel Corridor (AFC). AEA will strategically deploy Direct Current Fast Charging (DCFC) along the designated AFC, between Anchorage and Fairbanks, to help build out the national charging network. Once Alaska’s AFC is “fully built out” and meets the Federal Highway Administration’s criteria, which could take up to two years, AEA and DOT&PF will use NEVI Formula Program funds to install charging infrastructure along Alaska’s Highway (non-AFC) and Marine Highway Systems. The second phase of the program will focus on connecting small urban areas, rural communities on the road system, Alaska’s road system to Canada, and coastal communities located on the marine highway system. First Round of NEVI Awardees (Listed South to North) # Priority Site Site Location Grantee/Applicant 1) Anchorage Tikahtnu Commons North Anchorage Real Estate Investors, LLC 2) Wasilla Cottonwood Creek Mall Browman Development Company 3) Trapper Creek Trapper Creek Three Bears Tesla, Inc. 4) Denali State Park Mt. McKinley Princess Wilderness Lodge eCAMION USA, Inc. 5) Cantwell Jack River Properties LLC Tesla, Inc. 6) Healy Denali Princess Wilderness Lodge eCAMION USA, Inc. 7) Nenana Nenana Chevron Station Tesla, Inc. 8) Ester Ester Gas Tesla, Inc. 9) Fairbanks Westmark Fairbanks Hotel and Conference Center eCAMION USA, Inc. ### About the Alaska Energy Authority The Alaska Energy Authority is a public corporation of the state. Its mission is to reduce the cost of energy in Alaska. To achieve this mission, AEA strives to diversify Alaska's energy portfolio increasing resiliency, reliability, and redundancy. To learn more, visit akenergyauthority.org. About the Alaska Department of Transportation and Public Facilities The Alaska Department of Transportation and Public Facilities oversees 237 airports, 9 ferries serving 33 communities along 3,500 marine miles, over 5,600 miles of highway and 839 public facilities throughout the state of Alaska. The mission of the department is to “Keep Alaska Moving through service and infrastructure. 10/11/23, 12:02 PM In this issue: EV batteries — composition, recycling incentives, and future solutions https://mailchi.mp/b2ee3567955c/aea-submits-ev-infrastructure-plan-to-joint-office-13629419 1/5 View this email in your browser Alaska Electric Vehicle Working Group Newsletter, September 14, 2023 EV Batteries: A Closer Look One common motive people have for purchasing electric vehicles (EVs) is for environmental conservation. However, there is an elephant in the room when it comes to sustainability as it relates to EVs — the batteries. Some find it concerning that substantial quantities of critical minerals must be mined from the earth to manufacture batteries. That concern is compounded when thinking about what happens to the batteries, and therefore the mined critical minerals, after the battery reaches the end of its life. Do they become another landfill resident? Recycled? Repurposed? Luckily, EV batteries have a long life to begin with! Most EV manufacturers have a battery warranty that covers the battery for up to 8-10 years or 100- 150,000 miles depending on the terms. Details of the warranties vary, but ultimately manufacturers don’t want to be on the hook if the battery fails, so the intention is to have a long battery life out of the gate. A predictive model by the National Renewable Energy Laboratory estimates that, in moderate climates, batteries may last between 12 and 15 years, or in extreme climates, eight to 12 years. Currently, most EVs out on the road are younger than that. This means the number of batteries that need to be recycled is low but will continue to climb in the years to come. 10/11/23, 12:02 PM In this issue: EV batteries — composition, recycling incentives, and future solutions https://mailchi.mp/b2ee3567955c/aea-submits-ev-infrastructure-plan-to-joint-office-13629419 2/5 Visualization courtesy of Visual Capitalist. It takes just a cursory glance at these numbers to realize that battery recycling could be a critical component of the EV manufacturing process moving forward. With so many minerals needed for each battery, the economic and environmental feasibility of mining the raw materials for each and every battery is uncertain. This is especially true when older materials can be recycled and reused. Unlike hydrocarbon fuels used for traditional internal combustion engines, which are completely spent and exhausted when used to fuel a car, critical minerals in EV batteries could be infinitely recyclable. 10/11/23, 12:02 PM In this issue: EV batteries — composition, recycling incentives, and future solutions https://mailchi.mp/b2ee3567955c/aea-submits-ev-infrastructure-plan-to-joint-office-13629419 3/5 Photo taken at Petersen Automotive Museum in Los Angeles, courtesy of AEA. Incentives are offered to encourage recycling. In fact, remember the Clean Vehicle Tax credits we discussed in a previous newsletter? (The tax credit that was included as part of the Inflation Reduction Act passed in August 2022.) Consumers are eligible for a $3,750 credit if the vehicle they’re buying meets the “Critical Mineral Requirement” which states that a certain percentage of critical minerals used for the battery must be extracted or processed in the United States or a United States free-trade agreement partner or recycled in North America. Yep, that’s right! Even if the critical minerals were originally extracted from the ground outside of the US, if they are recycled here, the new battery they’re making will be compliant with this requirement, making it eligible for the tax credit. Working on a solution There are multiple initiatives and companies that are focused on preparing for the future with higher numbers of EV batteries that must be recycled. These include ReCell, a recycling research and development center funded by the United States Department of Energy’s Vehicle Technologies Office, and Li- Cycle, a company that recycles lithium-ion batteries. Another major effort is Redwood Materials. Their goal is to create a “circular supply chain” for critical minerals used in EV batteries, allowing materials to be reused repeatedly. Located in Nevada with a recent expansion announcement in South Carolina, Redwood Materials has partnered with numerous automotive companies, such as Ford and Volvo. This is to create a program that recycles EV batteries. Their pilot program focused on collecting and recycling spent batteries from EVs in California. In March 2023, they published a one-year update on their progress. 10/11/23, 12:02 PM In this issue: EV batteries — composition, recycling incentives, and future solutions https://mailchi.mp/b2ee3567955c/aea-submits-ev-infrastructure-plan-to-joint-office-13629419 4/5 In that time, they collected 1,268 battery packs, which is over 500,000 lbs. of materials. They’ve already begun to produce battery materials such as anodes and cathodes that can be used to make future batteries. As the number of EVs on the roads continues to rise there is still much to do to prepare the recycling industry before today’s EV batteries age out. The Bipartisan Infrastructure Law set aside more than $7 billion to grow the domestic battery supply chain, with more than $192 million of that being set aside to fund research and development for battery recycling with programs such as the Lithium-Ion Battery Recycling Prize. Recently, a notice of intent to issue $37 million of funding (DE-FOA-003120) was announced for research and development related to electric vehicle battery recycling and reuse. So what now? Currently, there are not large numbers of EV batteries that need to be recycled or reused since most of them are still functional and serve their intended purpose of powering vehicles. Companies and governments continue to prepare for the eventual ramp-up of recycling needs, but in the meantime, other ideas for battery reuse are also being investigated. The potential for EV batteries to have “second lives” is an alternative to outright recycling them. People are researching the logistics of reusing batteries in smaller vehicles with shorter ranges, like golf carts. They are also researching using them outside of vehicles for energy storage to support rooftop solar power and microgrids. So back to the elephant in the room of EV batteries — maybe it’s not as big of an elephant as originally thought. Yes, there will come a time when there are greater numbers of EV batteries that are aging out. However, there are entities working toward solutions to ensure they are handled properly when that time comes. What We're Reading EV battery recycling (sae.org) Dead EV batteries turn to gold with US incentives | Reuters EV Battery Warranties and Exclusions | GreenCars Redwood Materials | Circular Supply Chain for Lithium-ion Batteries Visualizing the Key Minerals in an EV Battery (visualcapitalist.com) 10/11/23, 12:02 PM In this issue: EV batteries — composition, recycling incentives, and future solutions https://mailchi.mp/b2ee3567955c/aea-submits-ev-infrastructure-plan-to-joint-office-13629419 5/5 Everything You Need to Know about EV Battery Disposal (caranddriver.com) Alternative Fuels Data Center: Electric Vehicle Benefits and Considerations (energy.gov) Biden-Harris Administration Announces $192 Million to Advance Battery Recycling Technology | Department of Energy How Much Does a Tesla Battery Weigh? – Weight of Stuff EERE eXCHANGE: Funding Opportunity (energy.gov) EV batteries can be repurposed as grid storage to reduce battery supply chain impacts: report | Utility Dive Facebook LinkedIn Website The Alaska Energy Authority’s Alaska Electric Vehicle Working Group involves collaborative stakeholders focused on promoting the use of electric vehicles (EVs) in Alaska by removing barriers to EV adoption and increasing access to charging infrastructure. Stay up to date on AEA's EV efforts at our website here. Copyright © 2023 Alaska Energy Authority, All rights reserved. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.