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HomeMy WebLinkAboutREFAC Minutes 5-15-09 DraftRenewable Energy Fund Advisory Committee Meeting May 15, 2009, AEA Board Room 9:00am to 12:00pm Draft Minutes ROLL CALL: Committee Members AEA Staff Other Participants Vince Beltrami (Chair) Steve Haagenson Wynn Menefee DNR Jodi Mitchell Mike Harper Mike Mitchell Dept of Law Chris Rose Peter Crimp Denali Daniels Denali Commission Rep. Bill Thomas (phone) Butch White Brad Reeve Chris Rutz Sandy Burd (phone, Senator Hoffmann) Sarah Fisher-Goad Jim Posy James Strandberg Christa Caldwell Marge Cabanski The Renewable Energy Fund Advisory Committee convened at 9:06 a.m. Vince Beltrami asked if there was any public Comment and there was none. Steve Haagenson asked that updates to Round 1, Round 2 and staffing be added to the agenda. MOTION: Chris Rose moved to approve the meeting minutes from the March 20, 2009 Renewable Energy Advisory Committee and it was seconded by Brad Reeve. The motion passed unanimously. ISSUES DISCUSSED: Butch White began the discussion on the regulations and asked for input from the committee regarding: eligible applicants and projects, ranking of applications, request for reconsideration, failure to proceed and definitions especially in the area of IPPs. Draft Renewable Energy Grant Fund Regulations: Page 2, Eligible Applicants: Discussion was held on limiting funding to bio-fuels to only the areas of reconnaissance and feasibility and holding off on design and construction. The current proposed definition of bio-fuels is “solid, liquid, or gaseous fuel derived from biomass (page 9 #6 of proposed regulations) A question was posed and lengthy discussion followed on whether or not to award grant money to IPPs who cannot fund their project. It was recognized that IPPs have other means to obtain funding for construction such as bank loans, federal government programs, USDA Rural Development and etc. It was agreed that IPPs need to fund their own project and not use grant money as a benefit. The IPPs need to be owners of their projects. Mike Mitchell noted that in order to deal with the IPPs in the correct manner, that they are included in statutes and would require statuary change. The bar can be set conservatively to address issues regarding IPPs. All members agreed that a definition for IPPs was needed for the regulations. A suggested definition would be: 1. Amount of public benefit from the power produced, 100% 2. Come with 50% money in hand 3. Experience 4. Operational commitment 5. Bio-fuels , actually producing fuel (may be a sub definition) 6. Regulated and Certified 7. Cost based rates 8. Limit planning and development only 9. Sinking fund, hold as a bond, state to hold as escrow to replenish the fund 10. Have a different definition for heat, electricity and other fuels 11. Minimum power generation requirement The question was raised whether there should be requirement for a business plan in the RFA. Butch White noted that there is a place in the grant application that can be requested be completed. The committee summarized their discussion by saying that IPPs will be awarded grant money for construction as long as they meet the criterion listed above, or grant money for feasibility and reconnaissance. Steve Haagenson suggested inserting caps in the beginning of the grant application, rather than end of the application. Butch White commented that there is an intention to revisit the entire grant application. The other recommendations for the draft of the Renewable Energy Grant Regulations were: Page 2, Authority and Purpose: In the first sentence insert evaluation after application to read “to establish regulations for the application, evaluation, award, and administration”…….. Page3, Grant Applications, The grant application is part of the grant agreement and the agreement is part of the regulations. The question was asked if you have an item in the application and it is challenged and it’s not in regulations is that at risk? Yes. Mike Mitchell suggested adding “additional information requested by the Authority” in the application, that there will be a required general description of the subject areas and then sufficient authority to ask for other information if needed. Brad Reeve asked if it is possible for someone to plagiarize another grant application being that they are on the net, and not know anything about the project. Mr. Mitchell said it was not a requirement to post these applications on the net. It was felt that any plagiarized applications would be weeded out by the project team in the evaluation process. What about applicants from other states, who are looking for free money, can we just eliminate their applications? If they meet the requirements they should be considered. Page 4, Evaluation of Applications: In the second paragraph, change the word will to shall so that it reads “At a minimum the criteria shall include” Move 1 and 2 on the bottom of the page so there will be 4 points. Change the word may to shall so it will read “The authority shall also consider,” top of page 5 renumber 3-9 to 1-6 and insert the number 7 to be a catch all for other criteria assigned. The number 9 should be inserted into the next paragraph. Peter Crimp had asked if the door should be left opened for the residential program in the future. It was felt that this could be addressed at a later date. Page 5, Phased Approach to Assistance: In the last sentence delete “be required to re-apply” and change to read “and may apply for additional funds for subsequent phases of the project.” Page 6, Request or Reconsideration: The first sentence should be changed to read, “Applicants whose applications are rejected at the initial eligibility and feasibility review stage may request the Executive Director………” Page 6, Recommendations to the Legislature: The last sentence should be changed to read “Award of any grant under this program is subject to appropriation approval of the appropriations by the governor.” Page 6, Notice of Intent to Award a Grant: The last sentence should be changed to read “…..the grant is consistent with the funding available and updated milestones are identified.” Page 6, Grant Agreement: The first sentence should be changed to read “As a condition to provide grant assistance, applicants……” Page 7, On the top of page, change the word will to may so the sentence should read “A grant agreement may, in the authority’s discretion include” Add #10, language addressing the requirement of permits for site control and appropriate authorization which is needed before the project is started. Page 7, Failure to Proceed: The last sentence to read ‘funds and consistent with legislative approval". Page 8, Reporting of Operations: Delete the word an from the first paragraph so the sentence reads “…Grantee must provide O&M reports….” Butch White commented that he and Peter Crimp are still working on this regulation. Page 9, Grant Funded Assets: Not included with PCE, discussion was held on the last sentence “or any other energy tariffs are based.” Work will be done on this area to make it read correct. Page 9, Definitions # 4: 50% was changed to 100% #12 (will be numbered correctly) sentence now reads “waste heat recovery” as used in AS42.45.045 (/) (5) (A) means recovered heat. Delete # 7 entirely. The status of Round 1 is that there are only a few grants out. The vast majority of the grants have been created internally and need to be reviewed by Project Managers. One grantee has informed us they are not going forward with the project so that particular grant will go back to LB&A to get re-appropriated to next project on list Staffing: Steve Haagenson reported that there are fourteen positions for summer and fall work. These positions are needed to do the level of work needed. There will also be a need to add five new positions in AEA; a part time Biomass Project Manager; a Wind Assistant Manager; a Hydro Assistant Manager; two (one for Geothermal and Energy Efficiency) temporary Assistant Program Managers. These positions will manage contractors and conduct proper review of projects. There is a concern that 2 million dollars will be spent this year, although it is in the budget for a five year window. This situation will be closely monitored to ensure that projects are only reviewed if this Agency in charge of it. Steve Haagenson summarized the past nine months and thanked the committee members for all the input in achieving ting the grant process going, regulations drafted, money approved and a LB&A audit. Mike Mitchell was asked the status of the regulations. He commented the need to have adequate input from the Agency regarding the regulations. He has built in more than a month to look at the regulations and have a final internal review. The regulations can then be turned into “regulation language,” and are out for a mandatory thirty day public notice and comment. Once that is closed, the regulations get signed off and go to the Lieutenant Governor and become final. There may be a need to provide one or two public hearings in which the public can comment by teleconference. A public hearing is not required but due to the public interest in the regulations it may be needed. Butch White mentioned that the regulations need to also go through Board of Directors for approval. The goal is to have a valid set of regulations in place before prior to round 3. Meeting was adjourned at 12:30 p.m.