Proposer: Alaska Power and Telephone
Benefit/Cost Ratio: Applicant 0.5 AEA 0.32
Project Description: Alaska Power and Telephone (AP&T) is proposing a 400 kW, two-basin tidal energy development in North and South Bights of Port Frederick near Hoonah. The power plant would be connected to Hoonah via undersea cable, and supply the major portion of the community’s power. The completed project is estimated to cost $22,000,000. AP&T is requesting $400,000 in grant funds for reconnaissance and feasibility analysis for this project.
Contribution to Lower the Cost of Energy: Electric power at Hoonah is currently supplied by diesel generation. At completion, this project would generate up to 2.7 GWh of electric energy, and reduce energy costs to residents and businesses by between $476,000 and $622,000 per year. The nearby community of Game Creek, the Icy Straits lumber mill, and other users could tie into the transmission cable in the future.
Assumptions Modified: Assumptions modified in the AEA analysis include:
The applicant assumes a life of 20 years for the project, where AEA assumes a 15-year life.
The applicant assumes the current diesel generation at Hoonah produces 14 kWh of power per gallon, where AEA assumes 13 kWh of power per gallon.
AEA recommends 1.5% of construction costs be used as annual O&M costs for this type of project. The applicant uses a higher amount.
Concerns: Potential concerns with this project include:
While this project uses a well developed concept, it is not proven in practice.
This project is sized to only supply a portion of the energy needs to Hoonah. If it were sized larger (if that is possible), the B/C ratio would be higher.
The project site is on U.S. Forest Service land, and special use permits will be required for study and development.
AP&T does not currently supply power to Hoonah, so a power sales agreement must be established between AP&T and the current power provider.
Other renewable power projects are being considered for the Hoonah area, including connection to Juneau’s and Pelican’s hydroelectric energy systems, and development of geothermal and run-of-river hydroelectric generation.
There is potential for connection of other communities and facilities in the area to the power generation cable. The application does not indicate whether this development could be expanded to provide more energy.
It is reasonable to assume long-term sustainability of this project. AP&T is a well-established business with a long-term presence in the region. They appear to be moving cautiously with this project, and have done a previous study to understand the potential of the site selected.
Potential Public Benefits
This project proposes construction of a ten mile long undersea cable to transport power to Hoonah. That cable will be available to tie in other communities and facilities along the way, such as the community of Game Creek and the Icy Straits lumber mill. In addition, three miles of access road will be built, but it is in a remote area, not connected to any communities.
The project is expected to be operated remotely, with frequent (2 to 4 times monthly) inspections. So increased employment due to O&M will likely be one or less FTE.
Because application of this technology in Alaska has not been proven, it is not clear if this facility will improve the reliability of power generation in the Hoonah area.
As this type of project has not yet been built and operated, developing this facility will generate useful information that could possibly be used in other parts of the state.
In addition to reducing costs of living for residents, lower costs and greater reliability of electric energy would attract and sustain economic development in the area.
Construction of this project will provide short term jobs in the area.