Revised: July 20, Project Fact Sheet: Bradley Lake Hydroelectric Project

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1 Revised: July 20, 2015 Project Fact Sheet: Bradley Lake Hydroelectric Project Current Status: Clearing debris from the fish water intakes has been delayed until 2016 when the lake can be lowered to below the normal minimum pool elevation in late spring. The BPMC approved the replacement of the Static Var Compensators (SVCs) along the transmission line for an estimated $7.2M. Without the replacement of the aged SVCs, Bradley's energy may be limited for an extended time in case of a failure of the existing equipment. A license amendment application to divert Battle Creek into Bradley Lake was submitted March 12, 2015 to the Federal Energy Regulatory Commission (FERC). Alaska Department of Fish and Game (ADFG) and the U.S. Fish and Wildlife Service (USFWS) submitted comments on the application. AEA is working on responses to comments. AEA is investigating possible financing options for Battle Creek. Battle Creek Diversion Project: The purpose of this proposed project is to divert glacial water from Battle Creek glacier to Bradley Lake thus increasing the annual energy of the Bradley Lake Hydroelectric Project. The average energy increase to the Bradley Lake project would be 37,000 MWh which would be a nearly 10% increase to the Bradley average annual energy of 380,000 MWh. The project includes construction of four miles of road and a concrete diversion dam, and six foot pipe under the road to convey the water to Bradley Lake. Cost estimates with canal to convey water were deemed too high. Design has been revised to use a pipe under the road. Current capital construction cost estimate is less than $50 million. Aquatic studies were performed on lower sections of Battle Creek for two years. No fish have been found within several miles of the diversion site, but are present near tidewater. It is thought the project could have a positive impact on salmon through the removal of the summer glacial water and moderation of flows. Terrestrial studies (eagle nest surveys, bear denning, goat surveys) occurred during The process of amending the FERC license for the project has started. Agency consultations (Alaska Department of Fish & Game, US Fish & Wildlife Service, National Marine Fisheries) and the public have occurred. Construction could occur in 2017 if the amendment and permits are received in a timely manner and utilities want to proceed forward. Project Background: The power generation potential of Bradley Lake was first studied by the U.S. Corps of Engineers and presented in a report dated March The project was authorized by Congress in 1962, but despite its feasibility, federal funds were not available for its construction. The Alaska Energy Authority (then Alaska Power Authority) assumed responsibility for the project in Preliminary plans and field investigations began in In April 1984, the Authority submitted an application for license to FERC. The license to construct the project was issued on December 31, In December 1987, the Authority and the Railbelt utilities entered into a Power Sales Agreement to delineate responsibilities. The project was declared in commercial operation September 1, 1991 and has been producing power since. From 1995 to 2013 Bradley averaged 380,094 MWh a year at $.04 per kwh.

2 Bradley Lake Hydroelectric Project Fact Sheet Page 2 A Bradley Project Management Committee (BPMC) was formed in 1993 with representatives from each of the power purchasers and AEA. The BPMC is responsible for the management, operation, maintenance, and improvement of the project, subject to the non-delegable duties of AEA. Under the Power Sales Agreement, 100% of the project s capacity has been sold to the power purchasers: Chugach Electric Association, Inc. (30.4%) Municipality of Anchorage (25.9%) Homer Electric Association, Inc. (12.0%) Matanuska Electric Association, Inc. (13.8%) Golden Valley Electric Association, Inc. (16.9%) City of Seward (1.0%) Description: The hydroelectric project has 120 MW of installed capacity and is located 27 air miles northeast of Homer on the Kenai Peninsula. The project consists of a 125 foot high concrete faced, rock filled dam structure, three diversion structures, a 3.5 mile long power tunnel and vertical shaft, generating plant, interior substation, 20 miles of transmission line, and substation. Due to its remote location, the project has its own airstrip, boat dock, residential quarters, and utility system. The project is normally automatically operated by remote dispatch by Chugach Electric Association from Anchorage. Purpose: The Bradley project provides 5-10 percent of the annual Railbelt electric power needs at the lowest generation cost. Bradley is most important to the Railbelt electric system during the cold winter months. Demand for both electric power and gas for heat is at its highest. Utilities limited by available gas are able to use Bradley power to meet the high electric demand. Benefits: AEA ownership assures the Railbelt area of a long-term source of power at a stable cost and promotes economic development in the region. Project Cost: $328 million (original cost plus major capital improvements through June 30, 2015). Excludes project financing costs. Also excludes major maintenance and repair costs. Source of Funds: Legislative appropriations and AEA revenue bonds repaid by participating utilities.

3 Revised: July 28, 2015 Project Fact Sheet: Alaska Intertie Current Status: The Alaska Intertie continues normal operations carrying Bradley Lake and economy power north into the Golden Valley Electric Association (GVEA) system. The economy power is generated by Chugach Electric Association (CEA) and Municipal Light and Power (ML&P). Although power generally flows north, the line is available for GVEA to transfer energy south if an emergency situation finds the Cook Inlet region short of electric power. Issues of note: On June 29th the Alaska Regulatory Commission concluded an evaluation of the existing Railbelt transmission network at the direction of the Alaska Legislature. This evaluation resulted in five recommendations designed to aggregate the existing transmission assets in a manner that will allow economic dispatch of power in the Railbelt. Under this concept, electric load in the Railbelt would be served by the least cost source of power available at any given minute. In order to facilitate this goal, the RCA has directed the IMC to revisit the operating and reliability standards to determine if a uniform set of rules can be agreed upon by all of the Railbelt utilities and AEA. Description: The Alaska Intertie transmission line is a 170-mile long, 345kV transmission line between Willow and Healy that is owned by AEA and operates at 138 kv. The project includes transmission towers and conductors, transformers at the Healy and Teeland Substations, and system stability devices at three locations that are necessary to allow the Railbelt Utilities to remain interconnected. Purpose: The purpose of the Alaska Intertie is to interconnect GVEA, the regulated utility that serves areas north of the Alaska Range, with south central Alaska Utilities. Although the Alaska Intertie allows resources north and south of the range to be shared to improve reliability, the GVEA storage battery and generation resources have been used to send emergency power south at times to minimize catastrophic network wide outages. Source of Funds: The Intertie was built in the mid-1980s with State of Alaska appropriations totaling $124 million. As a result of the state funds there is no debt associated with this asset. Participants: The operation of the Intertie is governed by the Alaska Intertie Agreement entered into in 1985 and amended in The parties to this original agreement were AEA (formerly Alaska Power Authority), ML&P, CEA, Alaska Municipal Utilities System, GVEA, and the Alaska Electric Generation and Transmission Cooperative (AEG&T was comprised of Matanuska Electric Association and Homer Electric Association). As discussed in the current status, the Alaska Intertie Agreement was amended and restated in 2011, and there are now five parties to the agreement: AEA, GVEA, ML&P, MEA, and Chugach. Benefits: A 1981 cost/benefit analysis indicated that substantial energy cost savings would result from the construction of an intertie allowing the exchange of economy energy and the sharing of reserve generation capacity between the Anchorage and Fairbanks load centers. Although the anticipated yearly monetary benefit was originally estimated to be $17 million per year, GVEA ratepayers achieved savings in excess of $52 million in 2012.

4 Alaska Intertie Project Fact Sheet Page 2 of 2 Additional Background: The Amended and Restated Alaska Intertie Agreement (ARAIA) was signed by AEA and the Railbelt Utility participants in November The Utility Participants now include GVEA, CEA, ML&P, and Matanuska Electric Association (MEA). These four utilities and AEA each have a seat on the Intertie Management Committee (IMC). Although the updated Alaska Intertie Agreement invited Homer Electric Association, the City of Seward, and the US Army to become participants of the IMC at the time the amended agreement was signed, they chose not to join. The IMC has responsibility to operate and maintain the Alaska Intertie. The IMC adopted bylaws to govern their operation, and retained contracts and operating procedures to maintain an easy transition to the amended agreement. The long standing Intertie Operating Committee (IOC) continues to recommend operating policies, procedures, and standard practices to the IMC for consideration. Under the amended agreement, the IMC was charged with the establishment of new open access language by July 1, 2013, to allow access under common terms and conditions for potential intertie users. Although this collaboration required an extension of the deadline to allow for reasonable review of the proposed language, the updated open access language was adopted by the IMC on December 20, In addition to the adoption of new open access language, the IMC passed a resolution on November 1, 2013 adopting operating and reliability standards for the Alaska Intertie. These standards have been forwarded to the Regulatory Commission of Alaska for informational purposes. A 2 nd amendment to the ARAIA was adopted by the IMC modifying the budget Process allowing for administrative costs to be borne equally amongst the participants. AEA has agreements with participating utilities to assure the Alaska Intertie operates with prudent maintenance and operation by utilities. ML&P is the southern region operator and GVEA is the northern region operator. MEA and GVEA maintain the intertie in the southern and northern region respectively. AEA serves as financial administrator, providing basic accounting services to establish a cost-based wheeling rate that is trued up each year. AEA collects payments from Intertie users and pays expenses, including reimbursement costs incurred by the two operators of the line, ML&P and GVEA, and the three maintenance contractors, MEA, CEA, and GVEA. The recent action of the RCA will change this arrangement if the Commission is successful in moving the aggregated transmission network to a unified postage stamp rate to move bulk electric power in the Railbelt.

5 Revised: July 27, 2015 Fact Sheet: Biomass Program Current Status: Through AEA's biomass program, 12 wood heating systems are operational and reducing heating costs in Alaskan communities. The Renewable Energy Fund (REF) grants program has funded 53 biomass projects. Currently there are 13 biomass systems in design and construction. Numerous projects are in the development phase with 5 prefeasibility studies just completed through the Alaska Wood Energy Development Task Group. AEA was just awarded a USDA grant to develop a best practices handbook for Alaska schools to implements greenhouses in conjunction with biomass heating systems. Program Background: Alaska's most important biomass fuels are wood, sawmill wastes, fish byproducts, and municipal waste. AEA's biomass energy program focuses on developing wood-fired systems that displace fuel oil for heating public facilities, demonstrating fish oil biodiesel performance, and recovering energy from municipal solid waste. AEA is part of the Pacific Regional Biomass Energy Partnership, a state and federally supported effort that encourages bioenergy development in Alaska, Hawaii, Idaho, Montana, Oregon and Washington. Wood remains an important renewable energy source for Alaskans, with over 100,000 cords per year used for residential space heating statewide. Closure of the major pulp mills in Sitka and Ketchikan in the 1990s brought an end to large-scale wood-fired power generation in Alaska; however, recent increases in oil prices have raised interest in using sawdust and wood wastes as fuel for lumber drying, space heating, and small-scale power production. In 2010, the state's first large-scale pellet boiler was installed by the Sealaska Corporation at its corporate headquarters in Juneau. Additionally, the Tok School installed a chip-fired boiler in 2010 that annually displaces approximately 55,000 gallons of fuel oil. These demonstration projects have proven that biomass can significantly reduce the cost of energy in a community and has led to the start-up of other wood-fired boilers Coffman Cove, Craig, Gulkana, Elim, Thorne Bay, Haines, and Tanana. Interest in manufacturing wood pellets continues to rise. Currently, there are both small and large-scaled plants operating in Alaska. The largest facility, Superior Pellets, is located in North Pole and is capable of producing an estimated 30, 000 tons of pellets per year. Program Highlights: Through an MOU with 17 State, Federal, and Non-governmental organizations, AEA and the United States Forest Service have funded over 125 pre-feasibility studies since These low-cost pre-feasibility studies are the catalyst that led to the development of many of the Renewable Energy Fund applications and all of the operational biomass systems. Additional pre-feasibility studies are planned for Alaska Energy Authority was one of five states to be awarded a State Wood Energy Team grant through the U.S. Forest Service. This award, along with matching State of Alaska funds, will allow for the continuation of pre-feasibility studies and will provide technical support, education, and project development for biomass heating systems.

6 Revised: July 27, 2015 Program Fact Sheet: Combined Heat and Power/ Heat Recovery Current Status: There are currently over 90 communities in rural Alaska that utilize recovered heat from the diesel generators for space heating needs. In the last 10 years, 41 heat recovery systems have been updated or newly installed in rural Alaskan communities. Through the Renewable Energy Fund and Rural Power Systems Upgrade program, 4 systems have recently started-up, 18 systems are in design and construction phases, and approximately 33 communities have completed studies that show a heat recovery system is feasible. Program Background: Combined Heat and Power (CHP) is the concurrent production of electricity or mechanical power and useful thermal energy from a single source of energy. CHP may be regarded as a supply-side energy efficiency measure. Typical applications for heat recovery are environmental space heat for community buildings and augmented electric power generation. In diesel generating systems that are commonly used in rural Alaska, approximately 30 percent of the fuel is transformed into electrical energy and 60 percent of the fuel is transformed into heat energy. This heat energy that is normally wasted into the atmosphere can be recovered from the exhaust stack, jacket water, and charge air. The most efficient use of recovered heat is to use it directly for space heating, domestic hot water, or for tempering municipal water supplies to prevent freezing and facilitate treatment. The heat recovery systems are an extremely attractive investment with paybacks of 3-5 years in many communities. Over 60 additional communities in rural Alaska have been identified as potential opportunities to install recovered heat systems or to expand existing systems. Program Progress: A collaboration between the Alaska Native Tribal Health Consortium (ANTHC), AEA, Alaska Village Electrical Cooperative, and a representative from small, independent electrical cooperatives meets annually to prioritize communities for heat recovery feasibility studies. Up to seven studies are completed annually with funding from ANTHC and AEA. The studies provide all of the required information for a community to apply for design and construction funding for their heat recovery system. This program also investigates innovative technology for recovered heat applications in rural Alaska. Currently, Kotzebue is in the construction phase for an innovative recovered diesel heat to electricity technology, and Unalaska s system is operational. This Organic Rankine Cycle (ORC) technology has the opportunity to utilize recovered diesel heat in application where building heat is not feasible. Cordova and Tok have completed the installation of this ORC technology. Initial testing has shown that the economics of these systems are challenging even for rural Alaska. This program provides technical support to communities that are interested in innovative heat recovery technology and will assist in technology evaluations.

7 Revised: July 15, 2015 Program Fact Sheet: Emerging Energy Technology Fund Current Status: Eighteen demonstration project have been launched through the Emerging Energy Technology Fund. The projects were awarded grants in two competitive rounds of funding held in 2012 and They will demonstrate a broad range of technologies including battery and flywheel energy storage, river hydrokinetic devices, new heat pump systems, efficient diesel generation, and novel wind turbines. Projects funded under the program will record performance data throughout the demonstration period for independent review. Program Background: The Alaska State Legislature created the Emerging Energy Technology Fund (EETF) in 2010 to promote the expansion of energy sources available to Alaskans. EETF grants must be for demonstration projects of technologies that have a reasonable expectation of becoming commercially viable within five years. Projects can either: test emerging energy technologies or methods of conserving energy; improve an existing technology; or deploy an existing technology that has not previously been demonstrated in the state. For this fund energy technology is defined as technology that promotes, enhances, or expands the diversity of available energy supply sources or means of transmission, increases energy efficiency, or reduces negative energy-related environmental effects. Energy technology can include technologies related to renewable sources of energy, conservation of energy, enabling technologies, efficient and effective use of hydrocarbons and integrated systems. The EETF program uses a two-step review process: four-page abstracts are submitted by applicants in response to a funding announcement and are reviewed by AEA and the EETF Advisory Committee. A selected group of applicants is then invited to submit more detailed proposals from which funding selections are made. Program Progress: A combination of legislative appropriations and contributions from the Denali Commission led to a total of $8.9 million available for the first round of EETF funding, announced in The 71 abstract proposals submitted in response varied across a wide range of technological fields and scientific disciplines. Roughly half of the applicants were invited to submit full proposals and of these 16 projects were selected for funding. The awards totaled nearly $8.9 million in grant funds and brought a commitment of $3.1 million in matching funds for projects ranging from improved diesel efficiency to energy storage to river hydrokinetics. Work on the projects has begun and the Alaska Center for Energy and Power (ACEP) has been contracted to assist with data collection and verification on behalf of AEA. Of the 16 projects, one has been cancelled prior to grant execution. Awards for five projects under Round 2 of the EETF program were announced in March 2014 totaling $2.4 million in grants and leveraging $1.7 million in committed match. Round 2 projects include energy storage and heat pump demonstrations. Of the five Round 2 projects, one has been cancelled prior to grant execution.

8 Reviewed: July 23, 2015 Program Fact Sheet: Alaska Energy Data Inventory Current Status: Collaborative work with the Alaska Energy Data Gateway (AEDG) and the Alaska Energy Data Inventory (AEDI) teams was initiated in March. The two databases have complimentary features, one focused on geographic information system (GIS) mapping and display and the other on developing more sophisticated data search, download and reporting functionality. AEA is actively engaged in the development of both of these systems. Developers for both AEDI and AEDG are working to incorporate both databases to provide a mapping platform for the data stored in AEDG on AEDI. During a two day developers meeting to link the databases, the team created a demonstration site to shows information from AEDG on a map and with select information on PCE data that allows the visualization and inspection of the demonstration datasets. Program Background and Highlights: The Alaska Energy Data Inventory focuses on access to Alaska's energy data in easy to digest formats. Data products include an interactive mapping website for the Renewable Energy Atlas of Alaska, energy resource assessment maps, and a searchable reports library. The AEDI began as a collaborative effort between AEA, Department of Natural Resources (DNR), and the University s Geographic Information Network of Alaska (GINA). The programming team at GINA continue to support a web-based interactive map, library of publications, gallery of images, links to download GIS data and a portal to hydrological investigations. The Alaska Energy Data Gateway was launched in late 2013 and continues to develop as an online database with energy data, most of it at the community level, from across Alaska. The site provides baseline temporal data such as the Alaska Energy Statistics, fuel price surveys, and Renewable Energy Fund project performance data in a user-friendly format and through a single access point with data available for download in a variety of file formats. The Gateway hosts data from AEA, Department of Labor, Division of Community and Regional Affairs, U.S. Energy Information Administration and others. AEDG and AEDI demonstration site created by GINA:

9 Revised: July 28, 2015 Program Fact Sheet: Energy Efficiency and Conservation Program Current Status: AEA continues to manage the State Energy Program (SEP) federal funds for Alaska, sharing revenue 50/50 with the Alaska Housing Finance Corporation (AHFC). Construction is complete but grants not yet closed out in three of the current VEEP communities: Yakutat, Egegik and Perryville. Construction is close to complete in McGrath, underway in Koyukuk and just getting started in Minto. The Bristol Bay School District is on hold for this construction season while they assess funding alternatives to increase the size and scope of their efficiency project. Commercial Building Energy Audit (CBEA) program is complete. The program received 82 completed audits and 81 reimbursements were made. Participants are encouraged to implement some of the recommendations. AEA is surveying past year participants to increase our understanding of how effective audits are in moving private building owners to efficiency action and understanding what barriers stand in the way for those that do not implement recommended efficiency improvements. New CBEA building energy-use data continues to be loaded into the Alaska Retrofit Information System (ARIS) managed by AHFC, greatly increasing the body of data from which to do analysis and improve understanding of commercial building energy end-use. AEA completed audits to 16 non-profit entities serving Alaska Mental Health Trust beneficiaries. Funds were provided through a reimbursable services agreement from the Dept. of Health & Social Services (DHSS). AEA is now assisting DHSS staff with evaluating their criteria for distribution of an additional $850,000 available to implement recommended energy efficiency improvements. Program Background: AEA s energy efficiency programs have an average simple payback of less than four years on implemented efficiency measures. AEA s Energy Efficiency and Conservation (EE&C) program is working to achieve the State s 15 percent by 2020 energy efficiency goal through a variety of means. Current initiatives include the Village Energy Efficiency Program, Commercial Building Energy Audit program, industrial audit toolkit, statewide public education and outreach campaign, and technical assistance with regional and community level energy efficiency planning and implementation. Private commercial buildings The private commercial sector represents nearly 3/4 of all non-residential buildings and a large underserved market for energy efficiency programs in Alaska. The CBEA program will pay for up to 100 percent of the cost of an energy audit for privately owned commercial property. Energy audits not only provide a clear path to energy savings, they also provide energy education and incentivize private investment in efficiency improvements. EE&C staff also continue to work with energy service companies, private engineering firms, and the private commercial lending market to create opportunities for efficiency work in this market. Community Assistance EE&C outreach and education staff are working closely with community assistance staff and with regional planning contractors to provide information and technical assistance to communities and regions interested in efficiency. Efficiency is emerging as a high priority in most of the regional plans and with limited grant funds, communities and regions are looking for help in developing creative ways to realize the benefits

10 Energy Efficiency and Conservation Program Fact Sheet Page 2 offered by investment in efficiency improvements. EE&C staff continue to work with Strategic Technical Assistance Response Team (START) Program communities, following up on planning and efficiency initiatives developed during this summer s site visits. To date, three of the five START communities are moving forward with efficiency opportunities identified through AEA participation in those site visits. The next five Alaska START communities have been selected and AEA EE staff will play an active role when those initiatives, led by DOE, kick off later this summer. Data collection and analysis EE&C staff continue to work with AHFC to ensure that data collection across programs and agencies are consistent to allow for future analysis, program evaluation and continuous quality improvement. EE&C staff facilitated a training on building benchmarking lead by AHFC staff for regional planners and other interested parties at the Rural Energy Conference. Follow up with regional and community level stakeholders interested in efficiency led to the creation of a building inventory template for communities that is currently being tested by AEA staff when they travel to villages. The purpose of the building inventory initiative is to create a more accurate picture of the building make-up (both type and ownership) in remote Alaska places with no property tax system to rely on. AEA is also facilitating an energy data group to ensure coordination and collaboration related to data collection, use and reporting between AEA, AHFC, DCRA, ANTHC and Denali Commission. AEA has a shared use agreement with AHFC to utilize the Alaska Retrofit Information System database for building energy use data storage, analysis and reporting. Both AEA and AHFC program information is displayed on the energy efficiency map AEA has a MOU with the University of Alaska establishing clear lines of authority and control over the Alaska Energy Data Gateway, a robust relational database developed by the Institute of Social and Economic Research and used by AEA primarily for REF performance tracking and reporting. Outreach, education and stakeholder engagement Stakeholder engagement is managed through the Alaska Energy Efficiency Partnership. The Partnership has more than 40 member organizations and creates opportunity for collaboration and synergy among statewide stakeholders. On behalf of the Partnership AEA built and maintains a central hub of energy efficiency information, Outreach and education within EE&C includes a strong public education campaign that uses top-down, media driven marketing and bottom-up, stakeholder-led local initiatives that redistribute the same messages.

11 Revised: July 28, 2015 Program Fact Sheet: Geothermal Program Current Status: The geothermal program is currently administering one Renewable Energy Fund (REF) grant: geothermal exploration in Akutan. Program Background: Geothermal energy can be used for electricity production as well as space or process heating applications. The process of electrical production is very similar to a traditional coal power plant, except the energy is supplied by the Earth s heat instead of the combustion of coal. In both cases, a relatively high temperature and high-pressure fluid is expanded across a turbine to provide power to a generator, producing electricity. For a geothermal resource to be capable of economically-viable power production, a number of attributes must be present: 1) a heat source, 2) a reservoir with sufficient permeability and porosity, 3) sufficient heat conduction within the formation and 4) high enough fluid flow. AEA s geothermal program supports projects for geothermal development for power generation, direct use, and heat pumps and assists in identifying potential resources. Program Highlights: Alaska currently has one operational geothermal power plant at Chena Hot Springs. Resources in Hot Springs Bay Valley in Akutan and at Pilgrim Hot Springs north of Nome being explored for power generation potential. To date, four heat pump projects have been completed with Renewable Energy Fund support: a seawater heat pump at the Alaska SeaLife Center in Seward, and ground source heat pumps at the Juneau Airport, the Juneau Dimond Park Aquatic Center, and the Seldovia House senior center. Two additional projects are currently underway and a demonstration project using a new type of heat pump that uses CO2 as a working fluid has received an Emerging Energy Technology Fund award. Exploration drilling in Akutan Heat pumps in the Alaska SeaLife Center

12 Revised: July 28, 2015 Program Fact Sheet: Hydroelectric Program Current Status: The hydroelectric program is currently administering 30 Renewable Energy Fund (REF) and Legislative grants and assisting with other existing and developing hydroelectric projects. Recently completed program work includes completing a visual assessment for Thayer Lake and a project review for Waterfall Creek. Recent milestones include the beginning of operation for the Chignik Lagoon project (photo below) and the substantial completion of the Gartina Falls Project. Future work for program staff include coordination with the Department of Energy on the national Hydro Vision program and providing technical assistance for owners and developers. Program Background: As Alaska s largest source of renewable energy, hydropower supplies 20 percent of the state s electrical energy in an average water year. There are currently 45 operating hydroelectric projects in the state of Alaska that provide commercial power to utilities. Most are owned by the utilities they serve. Alaska has much untapped hydroelectric potential. The majority of Alaska s hydroelectric energy resources are located mainly in southeast and south central, with some resource opportunities in the interior, south west and the Aleutians. Hydroelectric plant configurations include conventional dam reservoir projects which regulate flows through the drawing down of reservoir levels and smaller capacity run-of-the-river projects which rely upon the rate and fall of natural streamflow to produce power. Hydropower generation allows the displacement of conventional fuel fired generation of electricity. Though time consuming to permit and expensive to construct, hydropower is a mature technology with the capability of locking in power rates for plus years. For a hydropower resource to be capable of economically-viable power production, a number of attributes must be present: (1) flowing water of sufficient quantity, (2) elevation drop in the river or stream (head), (3) proximity to load (power sales) and (4) minimal environmental risks from project development. AEA s hydroelectric program supports projects through grants for hydropower development for electrical power generation; organizes workshops and training sessions; and coordinates state assistance in developing exploration and study of potential new hydropower sites across the state. Note there are additional AEA program resources committed to hydroelectric development. These include: (1) staff to manage the development of the 600 MW Susitna-Watana Hydroelectric project and the Battle Creek Diversion for Bradley Lake Hydroelectric Project and (2) direct management of smaller hydroelectric projects in conjunction with diesel powerhouse and bulk fuel system replacement projects. Chignik Lagoon powerhouse

13 Revised: July 28, 2015 Fact Sheet: Ocean and River Program Current status: Three river hydrokinetic demonstration projects awarded funding under the Emerging Energy Technology Fund program have conducted field demonstrations of different devices in the summer of AEA has also partnered with the False Pass Tidal Project and Yakutat Wave Project to support resource assessments and with the Alaska Center for Energy and Power to develop debris mitigation technology for river hydrokinetic devices. Program Background: Ocean energy is divided into in-stream tidal and wave energy. In-stream tidal energy technology consists of many designs, but all convert the kinetic energy of the flowing water into electricity, most using some type of turbine. Turbine designs range from underwater wind turbine-style, to vertical- or horizontal-axis cross-flow turbines. As an emerging technology, wave energy conversion (WEC) devices exist in a wide array of designs aiming to convert wave energy into electricity. While not as consistent as the tides, the amount of potential wave energy is frequently predictable days in advance. River in-stream energy conversion (RISEC) devices work in a similar manner to tidal devices, but generally on a smaller scale. AEA s ocean and river program works to identify and overcome barriers to the advancement and deployment of hydrokinetic devices in Alaska. Program Highlights: Three device manufactures conducted device demonstrations of RISEC devices in the summer of 2014: Ocean Renewable Power Company, Oceana Energy Company, and Boschma Research, Inc.. With support from grants from the Emerging Energy Technology Fund, the three different hydrokinetic devices were tested in the Kvichak and Tanana Rivers. The projects monitored power production and fish interaction with the devices. Two devices are being further tested during summer With assistance from a Renewable Energy Fund grant, the University of Alaska Anchorage has completed a statewide hydrokinetic assessment which includes river power data collected from thirty sites around the state. The University of Alaska Fairbanks continues development of a surface debris diversion device, which has been successfully used for RISEC device testing at the Tanana River test site at Nenana.

14 Revised: July 28, 2015 Program Fact Sheet: Power Project Fund (PPF) Loan Program Current Status: Funds were distributed to Pilot Point to pay for repair and replacement of three diesel gensets. AEA s Loan Committee finalized approval of a $100,000 loan to Arctic Village to pay for diesel powerhouse engine replacement. The loan approval was pending 2014 audited financial statements, On June 28, the Cordova Electric Cooperative board of directors voted to maintain their current variable interest rate financing arrangement with CoBank for Humpback Creek. They have removed their PPF loan request. AEA staff met with the city manager and lobbyist for King Cove regarding financing for Waterfall Creek. The Department of Law determined that Alaska Bond Bank debt did not count toward the $5M PPF threshold of state monetary involvement which would trigger the need for legislative authorization for a PPF application. King Cove now has the ability to finance Waterfall Creek using only Bond Bank money or a combination of Bond Bank and PPF funds. Haida Energy submitted Power Sales Agreement to RCA for approval on March 9. AEA submitted comments in support of the docket and in support of expedited hearing. The RCA decision will be issued by August 25. Pelican submitted an application for a loan to complete repair work on their hydro facility. If approved, the PPF loan will be a 20 percent match to a federal grant the community has applied for. AEA staff continue to work with Platinum to determine project application scope related to their PPF application to purchase new bulk fuel tanks. Program Background: The PPF program provides loans to local utilities, local governments or Independent Power Producers for the development, expansion or upgrade of electric power facilities, including distribution, transmission, efficiency and conservation, bulk fuel storage and waste energy. The loan term is related to the productive life of the project, but cannot exceed 50 years. Interest rates vary between tax-exempt rates at the high end and zero on the low end. The tax-exempt rate is equal to the average weekly yield of municipal bonds for the 12 months preceding the date of the loan commitment. As of July 13, 2015 this rate is 4.47 percent. The interest rate can be adjusted downward in certain circumstances to improve financially feasibility. Loan requests of more than $5M require legislative approval. Program Progress: As of June 30, 2015, the outstanding balance of AEA s Power Project loans was approximately $6 million. There was one pending Power Project Loan application for $95,000. As of June 30, 2015: Cash balance $43,826,359 Outstanding undisbursed commitments $20,295,624 Outstanding operating budget commitment (FY15 & FY16) $ 1,053,200 Uncommitted Cash Balance $22,477,535 * *Includes $10 million Legislative appropriation w/ restrictions. Seeking re-appropriation of funds.

15 Revised: July 28, 2015 Program Fact Sheet: Solar Energy Current Status: AEA has awarded three Renewable Energy Fund grants for solar energy projects. The first was to Golden Valley Electric Association for a 1,300 square foot solar thermal water heating project at the Denali Education Center near Denali Park. The second was to Alaska Village Electric Cooperative for a 10kW solar photovoltaic project in Kaltag. The third is to Alaska Power and Telephone for a 24kW solar photovoltaic project in Eagle. The first two have been operating as projected for several years, and the Eagle project was commissioned in June of AEA sponsored and helped to organize a Solar Energy Workshop, led by the Alaska Center for Energy and Power. It was held in Anchorage on April 30 th, Program Background: AEA provides solar energy information, references, resources, and technical assistance. This technology is changing rapidly with the advent of cheaper panels, more sophisticated inverters, and micro-inverters. AEA gathers and shares information about solar project issues such as microgrid phase imbalance exacerbated by single phase solar projects on three phase grids and code issues. The three solar projects referenced above are monitored annually to track their performance. AEA has formed an Alaska Solar Working Group to share information and track the performance of solar projects in Alaska. Kaltag Solar Photovoltaic Project

16 Revised: July 13, 2015 Program Fact Sheet: Wind Program Current Status: The wind program manages 47 active projects funded by the Renewable Energy Fund (REF) and closed out 34 projects funded by both the REF and Denali Commission. $100,214,872 has been awarded for wind projects and $79,936,898 (80%) has been spent/reimbursed. The wind program is engaging communities through our Anemometer Loan Program (Copper River Region, Craig, Goodnews Bay, Haines, Hughes, Hydaburg, Ketchikan, Kotlik, Sitka, Tanana, Wrangell) to generate wind resource maps, select potential wind measuring sites, collect meteorological data and coach communities on how to approach and manage a wind energy project. The wind program also remains active in community and industry outreach through attendance, coordination and presentation in technical workshops, wind working group meetings, energy fairs and conferences. A LiDAR (Light Detection and Ranging) based wind measuring unit under cold weather demonstration and evaluation experienced equipment problems which were covered under warranty repair. The unit was returned to Alaska in April 2015 and testing has resumed at the Delta Wind Farm. This system could be used in place of or in conjunction with meteorological towers for the measurement of a wind regime at heights up to 200 meters above ground, studying wind characteristics across the entire rotor swept area of today s largest wind turbines. Program Background: AEA strives to make Alaska a leader in designing, planning, constructing and operating integrated wind-energy systems, providing the maximum benefit for utilities and ratepayers to offset electrical and heating needs. Our staff works to: Identify economic wind resources for potential development Support research and development efforts for rural and Arctic applications Establish best practices in the design, construction, operation and maintenance of integrated wind energy systems Educate Alaskans about wind energy Specific Goals for the wind program include: Establish clear expectations for wind resource studies, conceptual designs, final designs, construction and long-term operation and maintenance of wind energy systems - all tailored for the size of the system. Educate key players in Alaska wind projects on best known methods for wind modeling and design. Promote the concept of wind turbines as a component of an integrated energy system including generation and distribution. Hold grantees and suppliers responsible for the performance of wind energy systems through the lifetime of these projects a minimum of 20 years. Their performance today affects the funding and success of future projects. Partner with communities and AVTEC's Alaska s Institute of Technology to develop local workforces improving their ability to operate and maintain wind energy systems with a minimal level of out-of-state support.

17 Wind Program Fact Sheet Page 2 Partner with the university to improve the technology for wind applications in rural and Arctic environments. Program Highlights: The AEA wind program re-instituted the Anemometer Loan Program in 2013 with funding from the U.S. Dept. of Energy. The program loans 10-meter and 34-meter meteorological towers, anemometers, vanes and data loggers to communities to collect wind data in locations where viable wind regimes are expected. This gives participating communities reliable wind resource data when applying for Renewable Energy Fund Grants. New meteorological towers are being deployed to Craig, False Pass, Goodnews Bay, Hughes, Hydaburg, Ketchikan, Kotlik and Tanana. AEA partnered with the Islanded Grid Resource Center and the Alaska Center for Energy and Power (ACEP) to plan and host a wind-diesel workshop in March This third-annual technical wind energy conference attracted 190 attendees from Alaska, the lower-48 and the international wind community. Construction of two 100-kilowatt wind turbines in Buckland is completing commissioning while one 100-kilowatt wind turbine in Deering is expected to be installed during the fall of The LiDAR unit testing will run through late fall at the Delta Wind Farm with a final report to be written in Q Following a successful evaluation, the unit will be made available to the ACEP, wind project developers and existing wind farms in the state. AEA received a prototype wind data logger from Halus Power Systems in early July. After bench testing in the office, the unit has been set up on a test tower at the Musk Ox Farm in Palmer for a week of field testing. Once development is complete, Alaska wind resource studies will be able to use a robust data logger that is easier to install, collects higher-resolution data, exports results to a convenient data format and costs onefourth the amount of our current standard equipment. The unit collects wind speed from three separate anemometers, direction from one vane and temperature from an integrated sensor.

18 Revised: July 14 th, 2015 Program Fact Sheet: Bulk Fuel Program Current Status: Two projects are in construction (Shishmaref and Edna Bay), six in final design (Edna Bay, Kake, Kasaan, Kipnuk, Port Heiden and St. Michael), and one in conceptual design (Tuluksak). The Denali Commission has funded an assessment of 56 rural tank farm facilities, which will be completed by August 30 th, Program Background: Most of Alaska s rural communities rely on diesel fuel for some or all of their heating and power generation. Many of rural Alaska s bulk fuel storage facilities were constructed in the 1970 s or earlier. Some of these facilities are at the end of their design life and do not comply with state and federal codes and regulations. Some have tanks, pipes and other equipment that leak fuel. Regulatory agencies, such as the Coast Guard, the Division of Fire and Life Safety, and the Environmental Protection Agency, may prohibit fuel deliveries to these facilities. Communities often do not have funds for updating or replacing these storage facilities. The goal of AEA's bulk fuel program is to upgrade non-compliant bulk fuel facilities in communities that meet program criteria. Upgrading bulk fuel facilities reduces the cost of energy by reducing or eliminating fuel loss from leaks and spills. In addition, by providing adequate capacity for current and planned needs, communities may purchase fuel in larger quantities at a lower cost per gallon. Since 2000, the Denali Commission has provided funding to replace community bulk fuel facilities. Due diligence is carried out to ensure that project participants meet Denali Commission and State sustainability standards. The projects include a business operating plan, which describes the existing fuel facility organizational structure, the qualifications of responsible people, training opportunities, and estimated operation and maintenance costs. Program Progress: The AEA bulk fuel program has completed approximately 77 projects in rural Alaska, and has identified approximately 56 needing improvements. The Alaska Village Electric Cooperative has completed approximately 29 bulk fuel project upgrades.

19 Revised: July 28, 2015 Program Fact Sheet: Circuit Rider Program Current Status: A Circuit Rider Technician visited the following Communities from April 2015 June 2015: Clarks Point, Hughes, Igiugig, Kipnuk, Nunam Iqua, Ouzinkie, Perryville, Tuntutuliak, and White Mountain. Program personnel provided assistance with mechanical repairs, trouble shooting support, guidance on maintenance, and training on control systems. Program Description: Helps eligible utilities improve the efficiency, safety, and reliability of their power systems and helps reduce the risk and severity of emergency conditions by providing: remote monitoring training technical consultation on-site assistance minor repairs The program does not provide funding for major repairs or reconstruction of utility systems. Local knowledge and proper maintenance and operations of the powerhouse provides generation reliability. There is no charge to the utility for these services. Circuit Rider applications are sent to eligible utilities yearly by AEA Energy Development personnel. The Circuit Rider Program Manager reviews the applications, and in coordination with other information develops a priority list. The priority list is communicated to the Circuit Rider Project Manager for response scheduling. Requirements: Demonstrated need for assistance with operations maintenance and utility training Communities with a population of less than 2000 Power plant operator and/or utility staff must be available for training and consultation during the time of the visit Power plant operators must maintain written performance logs between visits Supervisory Control and Data Acquisition (SCADA) systems must be available

20 Revised: July 28, 2014 Program Fact Sheet: Emergency Response Current Status: AEA responded to the following community emergency from, April 2015 June 2015: Tuluksak The community currently is running on a third emergency generator. The community purchased and AEA installed a new permanent unit in early July. Program Description: On-call emergency action to reduce imminent threat to life or property during extended power outages. AEA responds to a real or potential emergency situation before disaster or major loss occurs. Funding is for procurement of manpower, materials, and equipment during the emergency.

21 Revised: July 28, 2015 Program Fact Sheet: Rural Power Systems Upgrade Program (RPSU) Current Status: April 2015 June 2015 An active spring with the completion of the Nunam Iqua module which is in transit to the site; the contractor is 50% complete with the Akiak distribution system; and another contractor is 90% complete with the Egegik distribution system. The Tuntutuliak distribution system is substantially complete with a contractor that provided a very attractive bid so additional work was able to be done in the community. The Atmautluak RPSU module is finishing up the heat recovery system (funded by REF); and the Tatitlek module is complete and moving toward project close-out. Program Background: The program concentrates on diesel powerhouses, hydroelectric, and electrical distribution. Typical projects include: Powerhouse upgrades or replacements Distribution line assessments and upgrades Heat recovery Line extensions It is not uncommon to see a 30 to 40 percent increase in fuel savings after a project is completed. The conceptual and final design, and construction process includes efficiency, reliability, safety, and sustainability. Identification, development, and integration of available renewable energy sources are a high priority. We maximize the use of local labor when available. Program Progress: We target small single-site utilities or entities. They may experience technical and administrative problems and/or lack specialized skills in the community. The remaining receives service from cooperative or multi-site utilities which typically are well-established organizations.