HomeMy WebLinkAboutRegional distribution recalculation for REFAC 1.28.15Page 1 of 2
Renewable Energy Fund Regional Distribution Approach (DRAFT 1/20/15)
January 28, 2015
At the Renewable Energy Fund Advisory Committee (REFAC) meeting on January 9, 2015, the committee
advised the Alaska Energy Authority (AEA) to consider a new approach to the regional distribution of
Renewable Energy Fund (REF) projects. Below is the three-step approach developed by AEA to respond
to the committee’s advice.
1. Use a regional population weighted “burden of energy cost” metric to establish regional funding
bands. The burden of energy cost for a household is calculated based on:
a. Residential electric costs assuming 500 kWh/month use
b. Heating fuel cost for a community assuming regional consumption from CCHRC’s recent
housing assessment. Consumption levels vary based on a number of factors, most
importantly temperature and house size.
c. Household income (Census: American Community Survey 3 year average)
Burden of energy cost = (HH cost of electric + heat energy) / HH income
This burden of energy cost is calculated for each community and then weighted by population to
generate a regional burden of energy number. This burden of energy cost is used to calculate
the range of funding that each region should receive, such that regions with high energy cost
burden are eligible to receive more funding cumulatively across all years of the REF.
The results indicate that Yukon-Koyukuk/Upper Tanana is considered “under-served”.
2. Cap all individual projects at $1.5 million (10% of Governor’s budget).
3. To achieve a better balance of funding across the state, regions that exceed the target funding
band will be capped so their share of the overall fund cannot grow. This rule affects the
Southeast region in this round. Therefore Southeast projects in the top funding tier are limited
to recommended projects that are in communities with the highest burden of energy cost.
Once the region’s funding equals 22.15% of recommended funding, the remaining projects will
be identified as recommended projects, but in a group outside the top tier of $15M of Round 8
projects.
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The following table identifies by energy region: REF funding to date, the burden of energy cost, and
Round 8 funding before and after the REFAC-advised criteria are applied.
Energy Region
Total Rounds
1-7 Funding
% of Total
Funding
Burden of
Energy Cost
(HH energy cost / HH
income)
Round 8
Funding
proposed at 1/9/15 REFAC
meeting
Round 8 Funding based on REFAC
recommendations
Aleutians $17,491,232 7% 12.12% $697,120 $2,197,120
Bering Straits $21,429,215 9% 34.98% $0 $100,000
Bristol Bay $13,647,042 6% 22.88% $859,696 $1,305,000
Copper River/Chugach $21,630,131 9% 15.73% $500,000 $770,807
Kodiak $19,499,319 8% 15.58% $400,000 $488,400
Lower Yukon-Kuskokwim $27,822,831 11% 26.51% $4,857,040 $2,148,500
North Slope $2,185,342 1% 2.44% $0 $1,916,584
Northwest Arctic $23,203,362 9% 24.57% $579,583 $694,583
Railbelt $30,106,142 12% 7.03% $0 $408,000
Southeast $54,830,472 22% 10.64% $7,106,561 $3,323,006
Yukon-Koyukuk/Upper
Tanana $15,093,379 6% 32.96% $0 $1,648,000
Statewide $565,439 0% 9.36% $0 $0
TOTAL $247,503,905 100% 215% $15,000,000 $15,000,000
Notes for recommendations lists:
1. * Funding for Lepquinum Center Ground Source Heat Pump project was reduced to the $1.5
million cap on all individual projects plus an additional $18,473 due to regional spreading in
stage 4
2. ** Funding for these projects was reduced to the $1.5 million cap on all individual projects
3. Projects in bold are in underserved regions of the state
4. Shading key
Heat project within $15M budget
Standard project within $15M budget
Heat project outside $15M budget
Standard project outside $15M budget