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HomeMy WebLinkAbout2025-02-14 BPMC Minutes ___________________________________________________________________________ BPMC Minutes 7/25/25 Page 1 of 7 BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE (BPMC) REGULAR MEETING MINUTES July 25, 2025 1. CALL TO ORDER Chair Million called the meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 10:00 a.m. A quorum was established. 2. ROLL CALL (for Committee members) Travis Million (Golden Valley Electric Association [GVEA]); Tony Izzo (Matanuska Electric Association [MEA]); Larry Jorgensen (Homer Electric Association [HEA]); Kat Sorenson (City of Seward); Arthur Miller (Chugach Electric Association [CEA]); and Curtis Thayer (Alaska Energy Authority [AEA]). 3. PUBLIC ROLL CALL (for all others present) Sunny Morrison (Accu-Type Depositions); Jennifer Bertolini, Mark Billingsley, Patrick Domitrovich, Pamela Ellis, Josi Hartley, Ryan McLaughlin, Jim Mendenhall, William Price, Mark Ziesmer (AEA); Joel Paisner (Ascent Law Partners); Matt Clarkson, Josh Crowell, Sherri Highers, Andrew Laughlin, Mike Miller, Paul Millwood (CEA); Dan Bishop (GVEA); Sarah Lambe, Martin Law, Andrew Patrick; Jessica Spuhler (HEA); and Josh Crowell, David Pease, Matt Reisterer (arrived late), Jon Sinclair, Tony Zellers (MEA). 4. AGENDA APPROVAL MOTION: A motion was made by Mr. Miller to approve the agenda. Motion seconded by Mr. Thayer. A roll call was taken, and the motion to approve the agenda passed unanimously. 5. PUBLIC COMMENTS - None. 6. APPROVAL OF MEETING MINUTES – June 20, 2025 MOTION: A motion was made by Mr. Thayer to approve the Minutes of June 20, 2025. Motion seconded by Vice-Chair. Izzo. A roll call was taken, and the motion to approve the Minutes of June 20, 2025, passed unanimously. 7. NEW BUSINESS A. Annual Meeting and Election of Officers ___________________________________________________________________________ BPMC Minutes 7/25/25 Page 2 of 7 Chair Million explained that nominations can come from the floor at this time. He began with nominations for the office of Chair, Vice-Chair, and Secretary/Treasurer. Mr. Thayer made a point of clarification, and asked if Vice-Chair Izzo is the current Vice-Chair. Chair Million agreed. Mr. Thayer nominated Vice-Chair Izzo as Chair. Chair Million nominated Mr. Miller as Chair. The votes were cast and tallied. Vice-Chair Izzo received four votes, and Mr. Miller received two votes. Vice-Chair Izzo was elected Chair. Mr. Thayer nominated Mr. Miller as Vice-Chair. There were no other nominations. Mr. Miller was elected Vice-Chair. Chair Million asked Mr. Thayer if AEA is permanent Secretary/Treasurer. Mr. Thayer agreed. Chair Million closed the election of the officers, and handed the gavel to Vice-Chair Izzo, as the new Chair. 8. OLD BUSINESS A. Updates i. Grip 3, Phase 1 Update Jim Mendenhall, AEA, provided the Grid Resilience and Innovation Partnerships (GRIP) 3 update. Mr. Mendenhall noted he will give an update on the Cook Inlet Power Link (CIPLink) project. AEA submitted the data request information in late June to the Department of Energy (DOE). There was one follow-up question, and the response was submitted the next day. No additional communication has occurred since June 26, 2025. Staff requested a status update for expected timeline for approvals, and no response has been received. Mr. Mendenhall commented that the contract and technical representatives at the DOE indicated that there is not much visibility into the DOE review team. Mr. Mendenhall reviewed that the contract status, and based on discussions with the contract and technical representatives at the DOE have verbally approved AEA’s request for a “Go” decision to move to the next budget phase. Additionally, they verbally acknowledged that the estimate submitted in mid-May was acceptable. However, they are prevented from giving a contractual extension until they have feedback from the process review team. Because the previous contract expired on June 30, 2025, and they have not given a contract extension, AEA officially does not have a contract. AEA continues to work on the project, but a few of the actions that require a “notice to proceed” have been paused until a contract extension is ___________________________________________________________________________ BPMC Minutes 7/25/25 Page 3 of 7 obtained to proceed with that work. Mr. Mendenhall indicated that if AEA decides to proceed with that work, it would be at risk to AEA, since there is no guarantee of reimbursement. Mr. Mendenhall discussed the main items in Budget Period 2. This includes continuing with the procurement for the major equipment of the HVDC converters and the cable, and completion of frontend engineering design work. The environmental field work and mapping of the sea floor would occur next summer. To date, approximately $1.2 million has been expended on the project. DOE is processing AEA’s latest invoice submitted. The next invoice through June 30, 2025 is expected to be submitted within the next two weeks. Vice-Chair Miller asked Mr. Mendenhall how he thinks the process is progressing from an overall perspective. Mr. Mendenhall responded that progress would begin to slip soon if an approval is not provided soon by the DOE. He noted that the project is in a good position, and is in a much better position compared to the GRIP projects. Based on conversations with the National Association of State Energy Officials (NASEO), AEA’s responses put them in a very good position. The project is currently still on schedule, but is moving closer to pushing the schedule out. The most critical activities are obtaining the permits for the environmental reviews next summer. A categorical exclusion for the marine work has been obtained and permits for mammal disturbance are being sought. Vice-Chair Miller indicated that the project must be completed in eight years. He asked for the official start date of that eight-year clock. Mr. Mendenhall noted the official start date is September 1, 2024, which makes the official end date August 31, 2032. Mr. Thayer commented that out of the 179 GRIP projects that are currently being reviewed, a conversation with Secretary of Energy Chris Wright last month revealed that the focus is to move forward transmission and generation projects. Mr. Thayer believes this project is in a good position since it is a transmission project. Many other states do not have transmission or generation projects within the GRIP awards. Mr. Mendenhall added that the technical representatives at DOE do not know if feedback or results will be given after the DOE process review team reviews each of the 179 GRIP projects or after the DOE has reviewed all of the 179 GRIP projects. There were no other comments or questions. ii. Dixon Diversion Update Ryan McLaughlin, AEA, provided the Dixon Diversion Update. Mr. McLaughlin reminded the Board that the target date for the submittal of the Draft License Amendment Application (DLAA) is January 2026. Staff is diligently working on the application and the associated engineering and environmental fieldwork. Exhibits A through G are in draft format. Drilling and geophysics is expected to be conducted at the Bradley Lake dam. The coordination between the engineers, drilling team, and Federal Energy Regulatory Commission (FERC) is ongoing. The Probable Maximum Flood (PMF) study is underway. The contractor EPS is designing the installation of 3- ___________________________________________________________________________ BPMC Minutes 7/25/25 Page 4 of 7 phase power from the Bradley Lake powerhouse to the dam. The power will also be used to power the tunnel boring machine, as part of the overhead and underground power combination. Mr. McLaughlin discussed that year two of the environmental study plan is on schedule. A stream gaging trip occurred this week to spot measure the discharge on the Martin River. Salmon surveys and geomorphology fieldwork will occur next week. The raptor survey just concluded, and found a large presence of golden eagles. Additionally, the Red Lake video surveillance system is set up and the preliminary results indicate the strongest sockeye run in the three years of monitoring. Mr. McLaughlin reported that he was at the Bradley Lake site last week for a FERC inspection of the dam. He was accompanied by the representative from the FERC Division of Dam Safety and Inspections, and the Bradley Lake operator, Andrew Carey. The inspection included a walkthrough of the Bradley Lake components and a flyover of the diversions. The site visit focused on visual inspections of product features and monitoring of potential failure mode, as outlined in the Bradley Lake dam safety program. Mr. McLaughlin noted that the prior FERC dam inspection was in 2021. This time period is longer than usual due to Covid and the inspector backlog. The inspection went well. FERC found no conditions that required immediate remedial action, and found no items that required follow up action. An official FERC report is expected in the coming weeks. Mr. McLaughlin commented that the positive FERC inspection was not unexpected due to the incredible project and the excellent job of the operators. It is a testament to the proactive management of Bradley Lake with the strong dam safety program and the pride that the operators take in maintaining a world-class facility. Mr. McLaughlin complimented Martin Law, HEA, and the Bradley Lake team. Mr. Thayer expressed appreciation to Mr. McLaughlin as he stepped into the role when Bryan Carey, AEA, retired. Mr. Thayer reiterated his thanks to Mr. McLaughlin for his diligent and excellent work. Chair Izzo asked Mr. McLaughlin that if the project went as planned, what is the reasonable target date for Dixon Diversion to come online. Mr. McLaughlin discussed that the best-case scenario is the completion in the winter of 2030, and the first water year in 2031. Chair Izzo echoed Mr. Thayer’s comments of appreciation to Mr. McLaughlin. There were no other comments of questions. B. Railbelt Regional Coordination Update Chair Izzo noted that Brian Hickey, Seward, is not in attendance; however, his written report is included in the Committee packet. There were no comments or questions. MOTION: A motion was made by Vice-Chair Miller to enter into executive session to discuss confidential legal matters with an attorney for the Committee or a member of the ___________________________________________________________________________ BPMC Minutes 7/25/25 Page 5 of 7 Committee, the immediate knowledge of which could have an adverse effect on the legal position of the Committee or Authority. Motion seconded by Mr. Million. A roll call was taken, and the motion to go into executive session passed unanimously. C. Dixon Diversion Financing i. Executive Session: 10:28 a.m. - (Bylaws Section 5.11.4(d)) –To discuss matters with an attorney for the Committee or a member of the Committee, the immediate knowledge of which could have an adverse effect on the legal position of the Committee or the Authority. The Committee reconvened its regular meeting at 11:14 a.m. Chair Izzo stated that no action was taken on any matters discussed in executive session. 9. OPERATORS REPORT Martin Law, HEA, provided the Operators Report. Mr. Law advised that the Operator’s Report is included in the Committee packet. He noted that Bradley Lake is running well and there are no issues to report. Chair Izzo commended Mr. Law for the terrific outcome of the FERC dam safety inspection, and for all of the work of the team from HEA and AEA. Mr. Law commented that the operators work hard at maintaining the facility and they take great pride in doing their jobs. Chair Izzo requested that Mr. Law communicate the appreciation for the efforts. There were no other comments or questions. 10. COMMITTEE REPORTS A. Budget vs. Actuals Mark Ziesmer, AEA, presented the draft Budget to Actual Expenses report for fiscal year July 1, 2024 through June 30, 2025. Mr. Ziesmer noted that the report remains in draft form as AEA continues to compile and review final expenses for the fiscal year. Mr. Ziesmer reported that the actual costs for capital purchases not funded by R&C Funds shown on Schedule A totaled $381,209. This exceeds the budget by approximately $230,000. The overage is primarily due to unplanned or unbudgeted expenditures. Schedule B shows the Operations and Maintenance (O&M) actual expenses are under budget by $1.5 million. All FERC categories in aggregate are also below budgeted levels. Mr. Ziesmer anticipates adjustments to Schedule B as AEA finalizes the fiscal year. He also expects that the under-budget variance will decrease slightly. Mr. Ziesmer noted that Schedule D shows the actual R&C purchases at a total of $2.4 million. The expenses were primarily related to the needle rebuild project and the Dixon Diversion project costs. Since inception, the Dixon Diversion project has incurred costs of $7.3 million. Mr. ___________________________________________________________________________ BPMC Minutes 7/25/25 Page 6 of 7 Ziesmer discussed that Schedule E shows the Battle Creek Non-R&C Capital Purchases totaling $2,621 for the one project. Schedule F shows the Battle Creek O&M expenses were under budget by $221,087, primarily due to the 4% allocation cost from Bradley Lake. Mr. Ziesmer expects revisions to Schedule F as the fiscal year is closed out. There continues to be no planned fiscal year activity or budget for Schedule H. Mr. Ziesmer discussed Schedule I shows that the SSQ Line O&M expenses were under budget by $192,385 due to less than anticipated expenses to-date. Mr. Ziesmer reviewed Appendix A, Capital Projects Funded by Bond Proceeds for Bond Series 11. Most of the activity is centered on the two SSQ Line upgrade projects with cumulative spending at approximately $15 million, of which $13.9 million is specifically allocated to SSQ Line upgrade projects. Vice-Chair Miller asked if a surplus is expected. Mr. Ziesmer noted there will be a surplus for all three portions of the budget and he expects a surplus refund for Bradley Lake, Battle Creek, and SSQ Line. Vice-Chair Miller asked if Mr. Ziesmer has an estimate of the refund amount. Mr. Ziesmer indicated that he will know in another month or two during the audit process calculation. Vice-Chair Miller asked if another update will be provided next month. Mr. Ziesmer agreed that he would provide another update. There were no other comments or questions. B. O&D Report Josh Crowell, MEA, reviewed the Operation and Dispatch (O&D) Committee Report. Mr. Crowell noted the report is included in the Committee packet. Several Committee members visited the project for the first time. The assignment from the previous meeting was for O&D to begin discussing the SS and the SSQ Line schedules and costs. Those lengthy discussions occurred and one of the concerns is that the SSQ team believes their costs are going to increase for material. Consequently, the SS, SSQ team, and AEA are going to meet and continue the discussion. An update is expected to be given at the September BPMC meeting. There were no comments or questions. 11. EXECUTIVE SESSION: 11:07 a.m. - (Bylaws Section 5.11.4(d)) –To discuss confidential financial matters the immediate knowledge of which may have an adverse effect on the Authority or Project. Chair Izzo asked counsel if there was a need to go into executive session. Joel Paisner indicated there is no need to go into executive session. There were no additional comments, questions, or objections. 12. MEMBERS COMMENTS NEXT MEETING DATE – September 19,2025 Mr. Jorgensen expressed appreciation for the discussion today. Vice-Chair Miller recognized again the positive FERC inspection results, which highlights the work of AEA, HEA, and staff. Vice-Chair Miller emphasized the significance of the meaningful positive FERC inspection, which reflects how well the overall project is managed. Vice-Chair