HEA Members form participants favor renewable energy projects and encourage our coop to investigate as many potential options as possible. For most of us, however, that does not mean blanket approval of any renewable energy project regardless of its social, economic, or environmental consequences. Many questions were raised about possible negative affect to Kenai River and it's wider watershed from several small hydroelectric projects proposed by HEA known as Kenai Hydro. Preliminary studies confirmed significant problems for all except the Grant Lake project. To HEA's credit, efforts to move forward those projects were dropped. Now, however, HEA has decided to press on with Grant Lake. The Alaska Center for the Environment, Kenai Watershed Forum, and Friends of Cooper Landing contend that the Grant Lake project proffers the same problems as the discontinued projects and should also be abandoned. HEAMF was contacted and asked to circulate the information below and attached.
HEA Management has been silent regarding this project recently, ostensibly lacking funds to proceed. The sudden effort to move forward on a fast rack came as a surprise to many stakeholders. While HEAMF has not taken a pro or con position with regard to Grant Lake, it is important that the issues surrounding it receive serious consideration well in advance any decision to develop. As an HEA member, you deserve to have an opportunity to understand and weigh in on these issues.
"Keep the Kenai River Wild"
Homer Electric Association is moving forward with plans to put a dam on Grant Lake, a tributary of the Kenai River. The plans call for 3.5 miles of new roads and transmission lines, a 10 foot by 120 foot long dam, a 110 foot high surgetank, penstock and powerhouse. Grant Lake would be flooded and the water flow in Grant Creek would be interrupted. The cost of construction is estimated at 27 million dollars. Alaska Center for the Environment believes that the costs of losing fish habitat in one of Alaska’s favorite and most productive local watersheds is too high of a price to pay for the insignificant amount of power which will be generated as a result of this project. Grant Creek supports anadromous fish species including Chinook, sockeye and Coho salmon as well as resident species including rainbow trout and Dolly Varden. The Kenai River system supports 34 species of anadromous and resident fish.
What Can You Do?
Please attend the FERC Scoping Meeting and Environmental Site Review. The meeting will take place in Moose Pass on June 2, at 7 PM at the Moose Pass Community Hall. It is the only opportunity to meet with Federal Energy Regulatory Commission officials. Laws require the Commission to independently evaluate the environmental effects of issuing an original license for the Grant Lake Project as proposed, and to consider reasonable alternatives to the applicant’s proposal. FERC is seeking information about the possible impacts this project could have. These could include impacts to water quality and quantity, fish and wildlife resources, cultural, recreational, aesthetic and economic impacts, land use, geologic, soil and other terrestrial resources.
Sign petition opposing the dam by visiting:
www.ipetitions.com/petition/keep_the_kenai_wild/
Submit scoping comments to FERC: (due July 6th, 2010)
*For more information about the process: http://www.kenaihydro.com/documents/GrantLake_Scoping1.pdf
Thursday, May 27, 2010
Tuesday, May 18, 2010
HEAMF Call in Reminder
DON'T FORGET!!! CALL THE COFFEE TABLE PROGRAM
KBBI/KDLL this Wednesday, May 19 at 9:00 AM
The focus will be all things HEA with guests HEA General Manager Brad Janorschke and Public Relations Coordinator Joe Gallagher.
Call 235-7721 on the southern peninsula, 1-800-979-7405 from elsewhere.
ASK QUESTIONS
TELL THEM WHAT YOU WANT AS AN HEA MEMBER
1. ANTI-COOPERATIVE PRACTICES
Why were HEA members excluded from the planning of the Independent Light project?
Shouldn’t the HEA membership be given a chance to approve, modify, or reject this historic change?
Shouldn’t HEA members have more opportunities for planning and approving or rejecting other proposed projects such as small hydroelectric and wind?
Was the Alaska Electric and Energy Cooperative (AEEC) formed with approval of the HEA membership or simply by the HEA Board and staff?
2. ALASKA ELECTRIC & ENERGY COOPERATIVE (AEEC)
Is it true that HEA members are not also AEEC members? Who is an AEEC member?
Who runs AEEC?
Who is AEEC responsible to?
Does the HEA Tariff also apply to AEEC or does it have it’s own?
3. LEVEL OF DEBT
Is it true that the combined HEA/AEEC debt is or soon will be at $339 million.
Is it true that AEEC is not bound by the $450 million HEA debt cap and has no such limit of its own?
Will $180 million cover all elements of the Independent Light project or will additional debt be required? If more, how much?
How will payment toward interest and debt retirement affect electric rates?
4. INDEPENDENT LIGHT AND OTHER PROJECTS
HEA management asserts that “studies indicate that the cost for HEA to own and operate the new assets will be about the same (perhaps slightly lower) as paying another utility for wholesale power.” Where can HEA members review these studies?
Even though the decision was made without their input, most HEA members seem to support upgrading the Nikiski plant. However, many question the wisdom of buying new gas turbines for Soldotna as the best way to meet peaking, reserve, and contingency demand. Would you be willing to bring the wider HEA membership into the decision process now?
If we invest hundreds of millions in Nikiski AND new gas turbines to meet ALL base load, peak, and emergency demands how will we afford to buy significant amounts of renewable energy as new projects come on line?
The Legislature appropriated $7 million to fund a 5 MW reciprocating generator or a battery bank to allow HEA to integrate the 14.4 MW of power from the Kenai Winds project into the existing grid. Why won’t that solve the problem of “following” this intermittent source of energy?
KBBI/KDLL this Wednesday, May 19 at 9:00 AM
The focus will be all things HEA with guests HEA General Manager Brad Janorschke and Public Relations Coordinator Joe Gallagher.
Call 235-7721 on the southern peninsula, 1-800-979-7405 from elsewhere.
ASK QUESTIONS
TELL THEM WHAT YOU WANT AS AN HEA MEMBER
1. ANTI-COOPERATIVE PRACTICES
Why were HEA members excluded from the planning of the Independent Light project?
Shouldn’t the HEA membership be given a chance to approve, modify, or reject this historic change?
Shouldn’t HEA members have more opportunities for planning and approving or rejecting other proposed projects such as small hydroelectric and wind?
Was the Alaska Electric and Energy Cooperative (AEEC) formed with approval of the HEA membership or simply by the HEA Board and staff?
2. ALASKA ELECTRIC & ENERGY COOPERATIVE (AEEC)
Is it true that HEA members are not also AEEC members? Who is an AEEC member?
Who runs AEEC?
Who is AEEC responsible to?
Does the HEA Tariff also apply to AEEC or does it have it’s own?
3. LEVEL OF DEBT
Is it true that the combined HEA/AEEC debt is or soon will be at $339 million.
Is it true that AEEC is not bound by the $450 million HEA debt cap and has no such limit of its own?
Will $180 million cover all elements of the Independent Light project or will additional debt be required? If more, how much?
How will payment toward interest and debt retirement affect electric rates?
4. INDEPENDENT LIGHT AND OTHER PROJECTS
HEA management asserts that “studies indicate that the cost for HEA to own and operate the new assets will be about the same (perhaps slightly lower) as paying another utility for wholesale power.” Where can HEA members review these studies?
Even though the decision was made without their input, most HEA members seem to support upgrading the Nikiski plant. However, many question the wisdom of buying new gas turbines for Soldotna as the best way to meet peaking, reserve, and contingency demand. Would you be willing to bring the wider HEA membership into the decision process now?
If we invest hundreds of millions in Nikiski AND new gas turbines to meet ALL base load, peak, and emergency demands how will we afford to buy significant amounts of renewable energy as new projects come on line?
The Legislature appropriated $7 million to fund a 5 MW reciprocating generator or a battery bank to allow HEA to integrate the 14.4 MW of power from the Kenai Winds project into the existing grid. Why won’t that solve the problem of “following” this intermittent source of energy?
HEAMF Action Alert
CALL THE COFFEE TABLE PROGRAM
KBBI/KDLL this Wednesday, May 19 at 9:00 AM
The focus will be all things HEA with guests HEA General Manager Brad Janorschke and Public Relations Coordinator Joe Gallagher.
Call 235-7721 on the southern peninsula, 1-800-979-7405 from elsewhere.
ASK QUESTIONS
GIVE YOUR PERSPECTIVE AS AN HEA MEMBER
While there are many issues affecting rates, quality of service, and other HEA member interests, four are particularly obvious right now:
1. ANTI-COOPERATIVE PRACTICES
2. ALASKA ELECTRIC & ENERGY COOPERATIVE (AEEC)
3. LEVEL OF DEBT
4. INDEPENDENT LIGHT AND OTHER PROJECTS
Want ideas for questions?
Look below (in italics) under each of the four topics, along with a little background information on each.
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
ANTI-COOPERATIVE PRACTICES
Questions:
Why were HEA members excluded from the planning of the Independent Light project?
Shouldn’t the HEA membership be given a chance to approve, modify, or reject this historic change?
Shouldn’t HEA members have more opportunities for planning and approving or rejecting other proposed projects such as small hydroelectric and wind?
Was the Alaska Electric and Energy Cooperative (AEEC) formed with approval of the HEA membership or simply by the HEA Board and staff?
Background:
The Seven Guiding Cooperative Principles
“Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership.”
“While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members.”
With Independent Light HEA has embarked upon the largest, most costly change in its history -- transformation from a simple distribution cooperative to a generation and transmission utility. HEA members remain out of the loop.
The development of and decision to move forward with Independent Light was made exclusively by the HEA management and Board of Directors. The General Manager was authorized to do so on June 24, 2008. A July 9, 2008 press release sketched a general plan. Members were provided little other information until a January 12, 2010 press release describing the complete plan. You were not invited to review and comment on the plan at any point. There was never a vote by the membership to accept Independent Light. This was true for its predecessor, the Healy coal plant plan, and is true for present small hydro and wind proposals.
All generation and transmission projects now take place under the Alaska Electric and Energy Cooperative (AEEC). It is unclear whether or not the general HEA membership voted to approve its formation in 2001.
ALASKA ELECTRIC & ENERGY COOPERATIVE (AEEC)
Questions:
Is it true that HEA members are not also AEEC members? Who is an AEEC member?
Who runs AEEC?
Who is AEEC responsible to?
Does the HEA Tariff also apply to AEEC or does it have it’s own?
Background:
There are many unknowns regarding AEEC. One thing IS clear -- HEA members have no standing. According to HEA staff and Directors, AEEC was formed in 2001 to allow funds to be borrowed at a lower rate of interest. It is a separate generation and transmission cooperative and HEA is the only member. AEEC bylaws do not indicate a limit on how much money it can borrow or spend. In recent months it has authorized borrowing $205 million. AEEC passes all expenses on to it’s one member/customer, HEA. HEA then charges us through our electric rates. Even though the two cooperatives are legally separate entities, HEA Directors also serve as AEEC Directors and HEA staff is tasked with AEEC work. All Alaska utilities operate under a set of rules outlined in a “Tariff “ filed with the Regulatory Commission of Alaska (RCA). It is unclear whether or not AEEC is also covered by the HEA Tariff.
LEVEL OF DEBT
Questions:
Is it true that the combined HEA/AEEC debt is or soon will be at $339 million.
Is it true that AEEC is not bound by the $450 million HEA debt cap and has no such limit of its own?
Will $180 million cover all elements of the Independent Light project or will additional debt be required? If more, how much?
How will payment toward interest and debt retirement affect electric rates?
Background:
According to HEA General Manager Brad Janorschke, the 2009 year end financial audit showed the debt to be $121 million HEA and $38 million for AEEC. In a May 3, 2010 e-mail he stated that when combined with all recently authorized new loans it would bring the total debt burden to $339 million. Bear in mind that only the $121 million in HEA debt counts against the $450 million debt cap. In HEA/AEEC meetings last year, HEA Director of Finance stated that present loans carried a fluctuating interest rate which was at about 4.75 percent at the time.
INDEPENDENT LIGHT AND OTHER PROJECTS
Questions:
HEA management asserts that “studies indicate that the cost for HEA to own and operate the new assets will be about the same (perhaps slightly lower) as paying another utility for wholesale power.” Where can HEA members review these studies?
Even though the decision was made without their input, most HEA members seem to support upgrading the Nikiski plant. However, many question the wisdom of buying new gas turbines for Soldotna as the best way to meet peaking, reserve, and contingency demand. Would you be willing to bring the wider HEA membership into the decision process now?
If we invest hundreds of millions in Nikiski AND new gas turbines to meet ALL base load, peak, and emergency demands what incentive how will we afford to buy significant amounts of renewable energy as new projects projects come on line?
The Legislature appropriated $7 million to fund a 5 MW reciprocating generator or a battery bank to allow HEA to integrate the 14.4 MW of power from the Kenai Winds project into the existing grid. Why won’t that solve the problem of “following” this intermittent source of energy?
Background:
HEA management outlines two phases for Independent Light. We are already committed to the first -- adding a steam turbine to the Nikiski gas plant and associated upgrades to the Nikiski substation. This is intended to meet the needs of so-called “base load and intermediate generation.” The second phase involves acquisition of energy for so-called peaking, reserve, and contingency demand. Three options are suggested by HEA management -- build new gas generators in Soldatna, purchase energy from other producers, buy existing generation facilities from Chugach Electric Association.
HEA management claims that “The ‘Independent Light’ plan, because of its flexibility and sole control by HEA, actually provides a better opportunity to accommodate future renewable energy sources.” This claim refers to increased ability to compensate for variable output from wind turbines. Unfortunately, HEA keeps reducing the amount of wind energy they are willing to utilize from potential sources like the Fire Island and Kenai Winds project.
HEA’s response evades another basic issue. After you’ve spent hundreds of millions on enough gas turbines to meet all base load and contingency needs, what incentive will there be to move to renewables -- and with so much debt, where would the money come from?
At the May 11 HEA Board meeting General Manager Brad Janorschke indicated that he felt it was only feasible to use around 4 MW from any wind farm. He didn’t explain why $7 million would no longer pay for enough standby battery or generation equipment to balance more wind energy as originally planned.
KBBI/KDLL this Wednesday, May 19 at 9:00 AM
The focus will be all things HEA with guests HEA General Manager Brad Janorschke and Public Relations Coordinator Joe Gallagher.
Call 235-7721 on the southern peninsula, 1-800-979-7405 from elsewhere.
ASK QUESTIONS
GIVE YOUR PERSPECTIVE AS AN HEA MEMBER
While there are many issues affecting rates, quality of service, and other HEA member interests, four are particularly obvious right now:
1. ANTI-COOPERATIVE PRACTICES
2. ALASKA ELECTRIC & ENERGY COOPERATIVE (AEEC)
3. LEVEL OF DEBT
4. INDEPENDENT LIGHT AND OTHER PROJECTS
Want ideas for questions?
Look below (in italics) under each of the four topics, along with a little background information on each.
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
ANTI-COOPERATIVE PRACTICES
Questions:
Why were HEA members excluded from the planning of the Independent Light project?
Shouldn’t the HEA membership be given a chance to approve, modify, or reject this historic change?
Shouldn’t HEA members have more opportunities for planning and approving or rejecting other proposed projects such as small hydroelectric and wind?
Was the Alaska Electric and Energy Cooperative (AEEC) formed with approval of the HEA membership or simply by the HEA Board and staff?
Background:
The Seven Guiding Cooperative Principles
“Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership.”
“While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members.”
With Independent Light HEA has embarked upon the largest, most costly change in its history -- transformation from a simple distribution cooperative to a generation and transmission utility. HEA members remain out of the loop.
The development of and decision to move forward with Independent Light was made exclusively by the HEA management and Board of Directors. The General Manager was authorized to do so on June 24, 2008. A July 9, 2008 press release sketched a general plan. Members were provided little other information until a January 12, 2010 press release describing the complete plan. You were not invited to review and comment on the plan at any point. There was never a vote by the membership to accept Independent Light. This was true for its predecessor, the Healy coal plant plan, and is true for present small hydro and wind proposals.
All generation and transmission projects now take place under the Alaska Electric and Energy Cooperative (AEEC). It is unclear whether or not the general HEA membership voted to approve its formation in 2001.
ALASKA ELECTRIC & ENERGY COOPERATIVE (AEEC)
Questions:
Is it true that HEA members are not also AEEC members? Who is an AEEC member?
Who runs AEEC?
Who is AEEC responsible to?
Does the HEA Tariff also apply to AEEC or does it have it’s own?
Background:
There are many unknowns regarding AEEC. One thing IS clear -- HEA members have no standing. According to HEA staff and Directors, AEEC was formed in 2001 to allow funds to be borrowed at a lower rate of interest. It is a separate generation and transmission cooperative and HEA is the only member. AEEC bylaws do not indicate a limit on how much money it can borrow or spend. In recent months it has authorized borrowing $205 million. AEEC passes all expenses on to it’s one member/customer, HEA. HEA then charges us through our electric rates. Even though the two cooperatives are legally separate entities, HEA Directors also serve as AEEC Directors and HEA staff is tasked with AEEC work. All Alaska utilities operate under a set of rules outlined in a “Tariff “ filed with the Regulatory Commission of Alaska (RCA). It is unclear whether or not AEEC is also covered by the HEA Tariff.
LEVEL OF DEBT
Questions:
Is it true that the combined HEA/AEEC debt is or soon will be at $339 million.
Is it true that AEEC is not bound by the $450 million HEA debt cap and has no such limit of its own?
Will $180 million cover all elements of the Independent Light project or will additional debt be required? If more, how much?
How will payment toward interest and debt retirement affect electric rates?
Background:
According to HEA General Manager Brad Janorschke, the 2009 year end financial audit showed the debt to be $121 million HEA and $38 million for AEEC. In a May 3, 2010 e-mail he stated that when combined with all recently authorized new loans it would bring the total debt burden to $339 million. Bear in mind that only the $121 million in HEA debt counts against the $450 million debt cap. In HEA/AEEC meetings last year, HEA Director of Finance stated that present loans carried a fluctuating interest rate which was at about 4.75 percent at the time.
INDEPENDENT LIGHT AND OTHER PROJECTS
Questions:
HEA management asserts that “studies indicate that the cost for HEA to own and operate the new assets will be about the same (perhaps slightly lower) as paying another utility for wholesale power.” Where can HEA members review these studies?
Even though the decision was made without their input, most HEA members seem to support upgrading the Nikiski plant. However, many question the wisdom of buying new gas turbines for Soldotna as the best way to meet peaking, reserve, and contingency demand. Would you be willing to bring the wider HEA membership into the decision process now?
If we invest hundreds of millions in Nikiski AND new gas turbines to meet ALL base load, peak, and emergency demands what incentive how will we afford to buy significant amounts of renewable energy as new projects projects come on line?
The Legislature appropriated $7 million to fund a 5 MW reciprocating generator or a battery bank to allow HEA to integrate the 14.4 MW of power from the Kenai Winds project into the existing grid. Why won’t that solve the problem of “following” this intermittent source of energy?
Background:
HEA management outlines two phases for Independent Light. We are already committed to the first -- adding a steam turbine to the Nikiski gas plant and associated upgrades to the Nikiski substation. This is intended to meet the needs of so-called “base load and intermediate generation.” The second phase involves acquisition of energy for so-called peaking, reserve, and contingency demand. Three options are suggested by HEA management -- build new gas generators in Soldatna, purchase energy from other producers, buy existing generation facilities from Chugach Electric Association.
HEA management claims that “The ‘Independent Light’ plan, because of its flexibility and sole control by HEA, actually provides a better opportunity to accommodate future renewable energy sources.” This claim refers to increased ability to compensate for variable output from wind turbines. Unfortunately, HEA keeps reducing the amount of wind energy they are willing to utilize from potential sources like the Fire Island and Kenai Winds project.
HEA’s response evades another basic issue. After you’ve spent hundreds of millions on enough gas turbines to meet all base load and contingency needs, what incentive will there be to move to renewables -- and with so much debt, where would the money come from?
At the May 11 HEA Board meeting General Manager Brad Janorschke indicated that he felt it was only feasible to use around 4 MW from any wind farm. He didn’t explain why $7 million would no longer pay for enough standby battery or generation equipment to balance more wind energy as originally planned.
HEA Members Forum Update
“Deja vu all over again”
HEA plans to apply to the RCA for another 2% rate increase to take effect in July.
Easy Come, Easy Go
According to discussions at the May 11 Board and Committee meetings, 2009 HEA Board expenses exceeded the $30,000 budgeted by over $20,000. This was attributed in part to having so many new Directors needing training and to travel for lobbying and other utility related functions. President Debnam urged Directors to make flight reservations early in future to help reduce travel costs.
At the same time the Board approved plans to increase Director meeting stipends from $200 to $250 or $300 per day as of January 1, 2011. The separate $200 per day travel stipend was also reconfirmed.
The Truth, the Whole Truth
Among several Board Policy updates approved on May 11 was PB 221 Board of Directors Website Content. Under this policy Directors’ expenses will be published quarterly in the Kilowatt Courier and maintained on the HEA website. Other new items to be added to the website include Directors’ meeting attendance and voting records.
Don’t Ask, Don’t Tell
Board Policy 216, Designated Spokespersons, was approved on May 11 as well. This one directs that “All requests to the Board of Directors for information pertaining to action of the Board shall be directed to the President of the Board.” Does this worry you? Does it mean that your Board representatives are discouraged from communicating with you? Board President Debnam claims not -- “This policy was never intended to impede communication between Directors and HEA Members. I am proud to say that we have an extremely ‘member-focused’ board whose door is always open.”
The General Manager is designated spokesperson for anything related to operations of the cooperative.
Takes the Wind Out of Their Sails
HEA claims it would be too technically difficult to use all 14 + MW Kenai Winds LLC hopes to produce from its proposed Nikiski wind farm. Since wind power is intermittent and unpredictable utilities need to have other power to fill in during calm periods. While the $7 million appropriated by the Legislature was meant to provide money for a fix, HEA feels it still won’t be able to use much more that 4 MW of wind energy in the short term. HEA management and some Directors seem now to be leaning toward using the $7 Million to build our own, smaller wind farm -- assuming the Governor doesn’t veto the appropriation. Bait and switch?
Water Torture?
The Kenai Hydro isn’t dead. While it’s been pared down to one element, Grant Lake, HEA management is still hoping to move ahead with the project, in spite of ongoing opposition from area residents, Kenai watershed protection advocates, and a variety of Alaskan conservation groups. The Federal Energy Regulatory Commission has scheduled rush scoping meetings with comments due by early June. Notice includes a list of issues for consideration and a draft schedule for FERC’s analysis of the license application. The full document is available at www.ferc.gov, and has been posted at: http://www.kenaihydro.com/documents/index.php .
Jobs for Who?
As you probably noticed along ago, HEA has been outsourcing member billing. This change eliminated at least two local jobs but has proven efficient and cost effective. Nonetheless, it has caused a lot of heartburn among HEA members. The Board of Directors keeps getting complaints and now feels your pain. They are looking for ways to bring the work back to Alaska without increasing costs exponentially. No solutions yet, though.
Here Comes the Sun (and other stuff)
Don’t forget -- the Alaska Solar tour comes to the Kenai Peninsula tomorrow, Saturday, May 15. Go to http://www.alaskasolartour.org/ for more information.
Electric Coffee Table
Plan to tune in to next week’s Coffee Table Program on KBBI or KDLL (Wednesday, May 19, 9:00 AM). The focus will be all things HEA with guests Brad Janorschke and Joe Gallagher. This is your chance to ask some hard questions. Call 235-7721 on the southern peninsula, 1-800-979-7405 from elsewhere.
A special HEAMF alert will come your way soon with ideas for questions and comments.
HEA plans to apply to the RCA for another 2% rate increase to take effect in July.
Easy Come, Easy Go
According to discussions at the May 11 Board and Committee meetings, 2009 HEA Board expenses exceeded the $30,000 budgeted by over $20,000. This was attributed in part to having so many new Directors needing training and to travel for lobbying and other utility related functions. President Debnam urged Directors to make flight reservations early in future to help reduce travel costs.
At the same time the Board approved plans to increase Director meeting stipends from $200 to $250 or $300 per day as of January 1, 2011. The separate $200 per day travel stipend was also reconfirmed.
The Truth, the Whole Truth
Among several Board Policy updates approved on May 11 was PB 221 Board of Directors Website Content. Under this policy Directors’ expenses will be published quarterly in the Kilowatt Courier and maintained on the HEA website. Other new items to be added to the website include Directors’ meeting attendance and voting records.
Don’t Ask, Don’t Tell
Board Policy 216, Designated Spokespersons, was approved on May 11 as well. This one directs that “All requests to the Board of Directors for information pertaining to action of the Board shall be directed to the President of the Board.” Does this worry you? Does it mean that your Board representatives are discouraged from communicating with you? Board President Debnam claims not -- “This policy was never intended to impede communication between Directors and HEA Members. I am proud to say that we have an extremely ‘member-focused’ board whose door is always open.”
The General Manager is designated spokesperson for anything related to operations of the cooperative.
Takes the Wind Out of Their Sails
HEA claims it would be too technically difficult to use all 14 + MW Kenai Winds LLC hopes to produce from its proposed Nikiski wind farm. Since wind power is intermittent and unpredictable utilities need to have other power to fill in during calm periods. While the $7 million appropriated by the Legislature was meant to provide money for a fix, HEA feels it still won’t be able to use much more that 4 MW of wind energy in the short term. HEA management and some Directors seem now to be leaning toward using the $7 Million to build our own, smaller wind farm -- assuming the Governor doesn’t veto the appropriation. Bait and switch?
Water Torture?
The Kenai Hydro isn’t dead. While it’s been pared down to one element, Grant Lake, HEA management is still hoping to move ahead with the project, in spite of ongoing opposition from area residents, Kenai watershed protection advocates, and a variety of Alaskan conservation groups. The Federal Energy Regulatory Commission has scheduled rush scoping meetings with comments due by early June. Notice includes a list of issues for consideration and a draft schedule for FERC’s analysis of the license application. The full document is available at www.ferc.gov, and has been posted at: http://www.kenaihydro.com/documents/index.php .
Jobs for Who?
As you probably noticed along ago, HEA has been outsourcing member billing. This change eliminated at least two local jobs but has proven efficient and cost effective. Nonetheless, it has caused a lot of heartburn among HEA members. The Board of Directors keeps getting complaints and now feels your pain. They are looking for ways to bring the work back to Alaska without increasing costs exponentially. No solutions yet, though.
Here Comes the Sun (and other stuff)
Don’t forget -- the Alaska Solar tour comes to the Kenai Peninsula tomorrow, Saturday, May 15. Go to http://www.alaskasolartour.org/ for more information.
Electric Coffee Table
Plan to tune in to next week’s Coffee Table Program on KBBI or KDLL (Wednesday, May 19, 9:00 AM). The focus will be all things HEA with guests Brad Janorschke and Joe Gallagher. This is your chance to ask some hard questions. Call 235-7721 on the southern peninsula, 1-800-979-7405 from elsewhere.
A special HEAMF alert will come your way soon with ideas for questions and comments.
Thursday, May 6, 2010
Recent News
Election Disappointment
At yesterday's Annual HEA Meeting incumbent Director Tony Garcia was voted out while Board President Debbie Debnam was reelected by a substantial margin. Debnam is the last of the "old guard" Directors who favored business by executive session while promoting involvement in HEALY 2 and other coal projects. HEAMF supported her opponent Ken Hepner who favors open governance and serious efforts to increase inclusion of alternative energy sources to meet HEA load requirements. William Warren defeated Garcia. HEAMF endorsed Garcia largely because he had shown steady growth in supporting our objectives and we lacked knowledge about Warren. Subsequently, Ken Hepner and others who have known him suggest that Warren will make a good Director who will promote open governance and renewable energy. Bill Fry, the only District 3 candidate on the ballot was easily elected in spite of a write-in campaign.
Total Ballots Cast = 5,141 (23.8% of the 21,586 HEA Members)
Total Ballots Voided for Cause = 163
Total Ballots Counted = 4,978
District 1 -- Warren 918, Garcia 702, write-ins 32
District 2 -- Debnam 1,215, Hepner 592, write-ins 46
District 3 -- Fry 1,350, write-ins 93
Manager's Moment
HEA General Manager Brad Janorschke presented a much better overview than the fiasco of 2009. This time he gave a decent summary of the Independent Light project, a brief discussion of the nature of AEEC (Alaska Electric & Energy Cooperative, Inc.), and provide some updated information on the Kenai Winds, Kenai Hydro, and potential large hydroelectric and geothermal projects that might one day supply railbelt energy. Theoretically, his PowerPoint presentation should be posted to the HEA website some time today (http://www.homerelectric.com/). If you want more detailed information check it out. Several things Janorschke said are worth noting here, however:
Independent Light consists of two phases.
Phase I -- HEA/AEEC has already committed to this. It involves upgrade of the Nikiski plant. Contracts have been awarded for design work ($5,017,900), a GE steam turbine ($9,420,000), and related substation upgrades($3,813,697). This phase addresses "baseload," the ongoing 40 to 70 MW consumed by all HEA members.
Phase II --This phase will address "peaking, reserve, and contingency" power sources. Additional power is needed if energy requirements exceed normal baseload capacity, should the Nikiski plant or Bradley Lake fail or be shut down for maintenance, or during unforeseen situations such as a disaster. Three options are being investigated: build new generating capacity ourselves, buy an existing plant from another utility, purchase agreements for buying power from other power producers. No commitment has yet been made to any one or combination of these.
Independent Light and efforts to adopt renewables are now linked. Janorschke said that whatever HEA/AEEC chooses for phase two of Independent Light, the administration doesn't want it to constrain our ability to adopt new or better options as they become available.
HEA Members' Moment
During his explanation of AEEC Janorschke failed to mention that HEA members are not also AEEC members and, consequently, have no rights or authority with AEEC. During the member comment period I pointed this out as something all members should be aware of. It is a significant problem considering that all decisions about Independent Light are being made by AEEC, including plans to take on over $200 million in debt to finance the project. President Debnam ask HEA attorney Rick Baldwin to elaborate on my statement but he declined, saying that no further explanation was warranted.
Another member made a motion from the floor that Board of Director expenses be published in the Kilowatt Courier from now on. I made a friendly amendment that they also be posted on the HEA website. On a vote of the assembled membership the motion and amendment were passed. If memory serves, these floor votes are considered advisory and the Board may choose to accept or reject them. Stay tuned.
At yesterday's Annual HEA Meeting incumbent Director Tony Garcia was voted out while Board President Debbie Debnam was reelected by a substantial margin. Debnam is the last of the "old guard" Directors who favored business by executive session while promoting involvement in HEALY 2 and other coal projects. HEAMF supported her opponent Ken Hepner who favors open governance and serious efforts to increase inclusion of alternative energy sources to meet HEA load requirements. William Warren defeated Garcia. HEAMF endorsed Garcia largely because he had shown steady growth in supporting our objectives and we lacked knowledge about Warren. Subsequently, Ken Hepner and others who have known him suggest that Warren will make a good Director who will promote open governance and renewable energy. Bill Fry, the only District 3 candidate on the ballot was easily elected in spite of a write-in campaign.
Total Ballots Cast = 5,141 (23.8% of the 21,586 HEA Members)
Total Ballots Voided for Cause = 163
Total Ballots Counted = 4,978
District 1 -- Warren 918, Garcia 702, write-ins 32
District 2 -- Debnam 1,215, Hepner 592, write-ins 46
District 3 -- Fry 1,350, write-ins 93
Manager's Moment
HEA General Manager Brad Janorschke presented a much better overview than the fiasco of 2009. This time he gave a decent summary of the Independent Light project, a brief discussion of the nature of AEEC (Alaska Electric & Energy Cooperative, Inc.), and provide some updated information on the Kenai Winds, Kenai Hydro, and potential large hydroelectric and geothermal projects that might one day supply railbelt energy. Theoretically, his PowerPoint presentation should be posted to the HEA website some time today (http://www.homerelectric.com/). If you want more detailed information check it out. Several things Janorschke said are worth noting here, however:
Independent Light consists of two phases.
Phase I -- HEA/AEEC has already committed to this. It involves upgrade of the Nikiski plant. Contracts have been awarded for design work ($5,017,900), a GE steam turbine ($9,420,000), and related substation upgrades($3,813,697). This phase addresses "baseload," the ongoing 40 to 70 MW consumed by all HEA members.
Phase II --This phase will address "peaking, reserve, and contingency" power sources. Additional power is needed if energy requirements exceed normal baseload capacity, should the Nikiski plant or Bradley Lake fail or be shut down for maintenance, or during unforeseen situations such as a disaster. Three options are being investigated: build new generating capacity ourselves, buy an existing plant from another utility, purchase agreements for buying power from other power producers. No commitment has yet been made to any one or combination of these.
Independent Light and efforts to adopt renewables are now linked. Janorschke said that whatever HEA/AEEC chooses for phase two of Independent Light, the administration doesn't want it to constrain our ability to adopt new or better options as they become available.
HEA Members' Moment
During his explanation of AEEC Janorschke failed to mention that HEA members are not also AEEC members and, consequently, have no rights or authority with AEEC. During the member comment period I pointed this out as something all members should be aware of. It is a significant problem considering that all decisions about Independent Light are being made by AEEC, including plans to take on over $200 million in debt to finance the project. President Debnam ask HEA attorney Rick Baldwin to elaborate on my statement but he declined, saying that no further explanation was warranted.
Another member made a motion from the floor that Board of Director expenses be published in the Kilowatt Courier from now on. I made a friendly amendment that they also be posted on the HEA website. On a vote of the assembled membership the motion and amendment were passed. If memory serves, these floor votes are considered advisory and the Board may choose to accept or reject them. Stay tuned.
Tuesday, April 20, 2010
Updates
Unlimited Debt
While HEA has a $450 million debt cap, it turns out the Alaska Electric and Energy Cooperative (AEEC), HEA's separate generation and transmission corporation. has none.
All major projects such as Independent Light take place under AEEC.
Being a completely separate legal entity, AEEC is not directly accountable to HEA members -- you have no rights or privileges with respect to it. AEEC meeting agendas are not published on the HEA website and, at least recently, most meetings have been closed to HEA members. You can only influence AEEC indirectly through appeal to HEA Directors. In a recent e-mail exchange, one HEA Director wrote, "I'm aware of the smoke-and-mirrors aspect of that distinction with AE&EC being a one-member co-op, but that is the legal structure. That said, HEA+AE&EC's debts don't and won't exceed HEA's debt cap."
Getting Steamed Up
On April 6th AEEC approved a $5,017,900 design contract for addition of a steam turbine to the Nikiski facility. The contract has been awarded to Stanley Consultants, Inc., an Iowa-based company. This is the first step in implementing the Independent Light project. Most sources seem to agree that retrofitting the Nikiski plant for cogenration makes technical and economic sense. There is room, however, for significant disagreement over plans to follow up with installation of two new single cycle natural gas gererators in Soldotna.
HEA Website Upgrades
At the April 6 meeting, the HEA Operations committee approved our request that HEA Board Policies be posted on the website. They are available at http://www.homerelectric.com/ by clicking Board of Directors and Elections/Board Policies on the left side menu. You will see that bylaws, the district map, a meetings calendar and other Board related information are available there as well.
Unfortunately, so far none of our suggestions for improving the Independent Light Frequently Asked Question page have been acted on and our responses to answers posted there have not been addressed.
HEA Board Perks
You may have read the recent Peninsula Clarion article on HEA Board Reimbursements (April 9 -- $140,000 in director payments in 2009). This is a valid topic for discussion. Throughout the country there have been examples of rural electric cooperative Boards of Directors partaking of unethical and insupportable levels of payment, often amounting to millions of dollars. Is $140,000 excessive? One would need to look closely at how the money was used. HEA Directors are expected to put in an enormous amount of time and asked to travel often on behalf of the cooperative. Most join the Board with limited knowledge of energy issues or the workings of a utility. Professional development workshops and classes help them develop a working understanding to underpin decisions they are asked to make. The $200 per meeting stipend is among the lowest in the state yet the Board recently voted against increasing it. In addition to this stipend, tuition for professional development courses, travel and lodging for HEA business trips and reimbursement of related out of pocket expenses account for part of the money spent on Directors. Can this process be abused? Probably. Perhaps it would be helpful to HEA members concerned about this issue if HEA took steps to clarify how a budget is determined for these activities, how priorities for which events Directors should participate in are set, and what safeguards are in place to guard against abuse.
Net Metering
Although the RCA is still waiting for the State Attorney General to sign of on the Net Metering standards approved in January, HEA is moving to transition from from SNAP to net metering. HEA filed a net metering tariff with the RCA requesting immediate implementation and may be the first railbelt utility to have done so. May 27 is the earliest expected date for RCA approval.
Renewable Energy
An April 6 presentation by Chris Rose of the Renewable Energy Alaska Project (REAP) to the HEA Operatins Committee on Alaska's renewable energy potential was well received. There was specific reference to how HEA and other railbelt utilities can work toward incorporating renewables into their energy mix. HEA Directors showed interest in the potential of Mt. Spurr geothermal and Lake Chakachamna Hydroelectric projects and in tidal generation technology. Unfortunately, there was no discussion of how HEA would integrate the Independent Light project with these sources should they become available. Chris was invited to return and report after taking a first-hand look this spring at a tidal power prototype off the coast of Ireland.
HEA continues to consider how to utilize power from the Fire Island wind farm and Nikiski Kenai Winds projects when they come on line. Because wind power is intermittent it poses problems of load balancing and dispatch that are challenging. Studies of potential sites for small wind projects on the southern peninsula are ongoing. The Grant Lake component of the Kenai Hydro project is still being considered, though it will require additional funding before significant effort can take place.
GRETC on the Ropes
At the April 13 HEA Board meeting the consensus of Directors was that legislation to create a Greater Railbelt Energy & Transmission Corporation (HB 182, SB 143) will not pass the legislature this session. We suspect this is correct. The issue is very complicated, involving a complete reorganization in the way all railbelt utilities and regulators would operate. While both ratepayers and utilities have stated support for the concept of a GRETC, it's become clear that the two interest groups do not agree on some very basic elements and the RCA recently weighed in with it's own questions and reservations. The HEA Board still wants to work with other railbelt utilities and the next legislature on GRETC legislation.
While HEA has a $450 million debt cap, it turns out the Alaska Electric and Energy Cooperative (AEEC), HEA's separate generation and transmission corporation. has none.
All major projects such as Independent Light take place under AEEC.
Being a completely separate legal entity, AEEC is not directly accountable to HEA members -- you have no rights or privileges with respect to it. AEEC meeting agendas are not published on the HEA website and, at least recently, most meetings have been closed to HEA members. You can only influence AEEC indirectly through appeal to HEA Directors. In a recent e-mail exchange, one HEA Director wrote, "I'm aware of the smoke-and-mirrors aspect of that distinction with AE&EC being a one-member co-op, but that is the legal structure. That said, HEA+AE&EC's debts don't and won't exceed HEA's debt cap."
Getting Steamed Up
On April 6th AEEC approved a $5,017,900 design contract for addition of a steam turbine to the Nikiski facility. The contract has been awarded to Stanley Consultants, Inc., an Iowa-based company. This is the first step in implementing the Independent Light project. Most sources seem to agree that retrofitting the Nikiski plant for cogenration makes technical and economic sense. There is room, however, for significant disagreement over plans to follow up with installation of two new single cycle natural gas gererators in Soldotna.
HEA Website Upgrades
At the April 6 meeting, the HEA Operations committee approved our request that HEA Board Policies be posted on the website. They are available at http://www.homerelectric.com/ by clicking Board of Directors and Elections/Board Policies on the left side menu. You will see that bylaws, the district map, a meetings calendar and other Board related information are available there as well.
Unfortunately, so far none of our suggestions for improving the Independent Light Frequently Asked Question page have been acted on and our responses to answers posted there have not been addressed.
HEA Board Perks
You may have read the recent Peninsula Clarion article on HEA Board Reimbursements (April 9 -- $140,000 in director payments in 2009). This is a valid topic for discussion. Throughout the country there have been examples of rural electric cooperative Boards of Directors partaking of unethical and insupportable levels of payment, often amounting to millions of dollars. Is $140,000 excessive? One would need to look closely at how the money was used. HEA Directors are expected to put in an enormous amount of time and asked to travel often on behalf of the cooperative. Most join the Board with limited knowledge of energy issues or the workings of a utility. Professional development workshops and classes help them develop a working understanding to underpin decisions they are asked to make. The $200 per meeting stipend is among the lowest in the state yet the Board recently voted against increasing it. In addition to this stipend, tuition for professional development courses, travel and lodging for HEA business trips and reimbursement of related out of pocket expenses account for part of the money spent on Directors. Can this process be abused? Probably. Perhaps it would be helpful to HEA members concerned about this issue if HEA took steps to clarify how a budget is determined for these activities, how priorities for which events Directors should participate in are set, and what safeguards are in place to guard against abuse.
Net Metering
Although the RCA is still waiting for the State Attorney General to sign of on the Net Metering standards approved in January, HEA is moving to transition from from SNAP to net metering. HEA filed a net metering tariff with the RCA requesting immediate implementation and may be the first railbelt utility to have done so. May 27 is the earliest expected date for RCA approval.
Renewable Energy
An April 6 presentation by Chris Rose of the Renewable Energy Alaska Project (REAP) to the HEA Operatins Committee on Alaska's renewable energy potential was well received. There was specific reference to how HEA and other railbelt utilities can work toward incorporating renewables into their energy mix. HEA Directors showed interest in the potential of Mt. Spurr geothermal and Lake Chakachamna Hydroelectric projects and in tidal generation technology. Unfortunately, there was no discussion of how HEA would integrate the Independent Light project with these sources should they become available. Chris was invited to return and report after taking a first-hand look this spring at a tidal power prototype off the coast of Ireland.
HEA continues to consider how to utilize power from the Fire Island wind farm and Nikiski Kenai Winds projects when they come on line. Because wind power is intermittent it poses problems of load balancing and dispatch that are challenging. Studies of potential sites for small wind projects on the southern peninsula are ongoing. The Grant Lake component of the Kenai Hydro project is still being considered, though it will require additional funding before significant effort can take place.
GRETC on the Ropes
At the April 13 HEA Board meeting the consensus of Directors was that legislation to create a Greater Railbelt Energy & Transmission Corporation (HB 182, SB 143) will not pass the legislature this session. We suspect this is correct. The issue is very complicated, involving a complete reorganization in the way all railbelt utilities and regulators would operate. While both ratepayers and utilities have stated support for the concept of a GRETC, it's become clear that the two interest groups do not agree on some very basic elements and the RCA recently weighed in with it's own questions and reservations. The HEA Board still wants to work with other railbelt utilities and the next legislature on GRETC legislation.
Thursday, April 1, 2010
Ken Hepner's HEA Board Campaign Needs Our Help NOW
It is difficult to unseat an incumbent. Ken is running against HEA Board President Debbie Debnam who supported the Healy 2 coal plant deal and continues to support the questionable Kenai Small Hydro project and lots of Board executive sessions. We are told she is being supported by a powerful group of political insiders including Borough Mayor Dave Carey, Hugh Chumley, and HEA General Manager Brad Janorschke.
HEA Ballots will be mailed tomorrow. Past experience shows that most people mark and return their ballots within to following week or ten days.
Please volunteer to help by placing a Ken Hepner sign on your property (central peninsula folks), or for the phone tree (central AND southern peninsula folks).
Contact Ken or his campaign managers to volunteer.
Ken: hepner(email@)alaska.net or 262-8510
Campaign managers: Dan Chay chay(email@)alaska.com,
Robert Ruffner robert.kwf(email@)gmail.com
HEA Ballots will be mailed tomorrow. Past experience shows that most people mark and return their ballots within to following week or ten days.
Please volunteer to help by placing a Ken Hepner sign on your property (central peninsula folks), or for the phone tree (central AND southern peninsula folks).
Contact Ken or his campaign managers to volunteer.
Ken: hepner(email@)alaska.net or 262-8510
Campaign managers: Dan Chay chay(email@)alaska.com,
Robert Ruffner robert.kwf(email@)gmail.com
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