HomeMy WebLinkAbout1245 TDX Adak1245 TDX Hydro Power Generator Adak
Proposer: TDX Adak Generating, Inc. (TAG)
Benefit/Cost Ratio: Applicant: 8.24 Recommended: 8.24
Project Description:
The applicant seeks funding for Phase II, III, and IV work on an 89-kW hydroelectric project in
Adak, Alaska. The project would rely extensively on existing infrastructure, including a pipe,
dam, and penstock. The applicant estimates that the project would replace 779,640 kWh of
diesel-fired generation annually.
Total project cost:
The applicant estimates that total project costs for remaining Phase II, III, and IV work would be
$420,146, including $28,000 for a feasibility study and conceptual design, $68,561 for final
design and permitting, and $323,585 for construction and commissioning.
Funding Requested:
The applicant requests $294,102 from AEA, consisting of $19,600 for feasibility study and
conceptual design work, $48,007 for final design and permitting, and $226,496 for construction
and commissioning.
Contribution to Lower the Cost of Energy:
The project will displace more than 34,000 gallons of diesel annually and more than 1.7 million
gallons of diesel over the project’s 50-year life.
Assumptions Modified:
System Capacity – No changes made. See comments in “Concerns” section.
System Generation – No changes made. See comments in “Concerns” section.
Capital Cost - No changes made. See comments in “Concerns” section.
Annual O&M Cost – Applicant assumes annual O&M cost of $12,500. This exceeds one percent of
estimated project capital cost and is applied to both Applicant and AEA analyses.
Diesel Generator Efficiency – None provided by applicant. Efficiency rating of 12.81 kWh/gallon
applied to both Applicant and AEA analyses taken from PCE report.
Concerns:
1. The source and justification for applicant’s estimated costs for remaining phases is
unclear. The 2013 Adak Reconnaissance Study, authored by HATCH, estimates that the
total cost for the construction phase of a hydro project that utilizes the existing raw
water transmission pipeline from Lake Bonnie Rose to the water treatment plant would
be $2,750,000. The application states that the proposed location allows for the selection
of any of several hydro turbine types, while the HATCH study estimates the cost of a
turbine and generator (including labor) to be $430,000, which alone exceeds the
applicant’s total estimated project costs as presented in the Round 9 application.
Without clarification regarding how the revised proposed project would drastically
reduce estimated costs in the HATCH report, it is conceivable that the estimated project
cost of $420,146 is nearly a full order of magnitude lower than the project’s actual cost.
2. The applicant acknowledges that both the existing dam and penstock may be
deteriorated beyond repair.
3. The applicant selected the “Diesel Generation ON” option in Section 3.2.6 of the
application but indicated in Section 5.4.4 that the proposed system would allow the
diesel generators to be turned off for 1,752 hours per year.
4. Given the discrepancy between estimated project cost in the HATCH report and that in
the RE Round 9 application, it is not clear that the projects described in each are
equivalent. Moreover, the application does not specify whether the two projects are
equivalent or, if they are not, the nature of their differences. As such, it appears unclear
whether capacity and energy output estimates for the proposed project, as stated in the
application, are supported by the 2013 reconnaissance study.
Possible Enhancements:
Additional hydro sites may be developed through future projects to make Adak 100 percent
powered by renewable energy.
Long-term Sustainability:
The proposed project would displace a large portion of Adak’s demand for diesel for electric
generation and replace it with a renewable resource. The applicant states that the hydro
resource of Lake Bonnie Rose can provide stable power at all times of the year.
Potential public benefits:
The primary project benefit is to lower the cost of electricity to Adak residents and to reduce
risks associated with weather, barge schedules, and diesel storage limitations as they relate to
the importation of diesel to the island.