Tuesday, March 03, 2015

Newman running for GVEA Board District 4

I guess it is official now - I am a candidate for the GVEA board of directors District 4 which includes Steese East, Chena Hot Springs, Fox, Shannon Park, Island Homes, Hamilton Acres and the core area of downtown Fairbanks.

I have my website at gvea.chena.org and you are welcome to like my Facebook page Newman for GVEA.

Two way communication and transparency have been a mainstay of my advocacy for GVEA for decades - I don't see that changing. Reliability, keeping rates reasonable, trying to help moderate our increasing debt load are also pretty important tasks for the board.

Ballots will be mailed out May 8 with a month to get them back to GVEA. In the next couple months, I will be talking with our members to hear their concerns and let members hear from me as well. I will of course be at the annual meeting Wed. April 29, 2015, this year at Lathrop High School's Hering Auditorium.

I'm looking forward to this effort to help our co-op. It is a demanding effort for anyone serving on the board and I now have the time and decades of involvement to be able to give back to GVEA.

Feel free to contact me if you want to chat: gvea@chena.org or 907-488-2001

Monday, February 09, 2015

Green Power Advisory Board

I was going through some of my files and ran across this blast from the past: the Final Report of the Green Power Advisory Board (GPAC) March 2004. It might make some interesting reading for some. To my knowledge, the GPAC hasn't met of late.

Friday, February 06, 2015

Energy charge reduced due to low international oil prices

With the price of oil based fuel down significantly, GVEA's energy charge dropped from $0.09947/kwh to $0.07111/kwh, a welcome bit of relief. Fuel oil also has dropped significantly. We paid $3.51/gal for No. 2 fuel oil in November. Current price is $2.67/gal. Time to top off.

Saturday, January 10, 2015

Candidates for Board seats Districts 4 and 7

There were two nominees each for board seats up for election this year: District 4 includes Steese East, Fox, Chena Hot Springs, Island Homes and a good part of the downtown core. Gary Newman, long time GVEA involved member-advocate and originator of this blog, posting as Common Sense Frank Eagle, incumbent board member, running after his first term District 7 includes the area down the Parks Hwy: Nenana, Healy, McKinley Park Long time incumbent Bill Nordmark Keith Walters, retired Usibelli superintendent While there are still pending interviews with the nominating committee during the next month and final selection by Feb. 13, it seems pretty likely that these will be the final nominees. Voting takes place by mail or on line starting in early May. The annual GVEA meeting is scheduled for April at Hering Auditorium (Lathrop High School). I will offer that I am running as I have been able to clear time to be able to serve. Being a responsible board member is quite demanding, equivalent to a 25% to 50% of a full time job. While I have attended around 200 board meetings in the past few decades and, as an active member-owner of GVEA, I have succeeded in a number of initiatives to increase transparency to the membership and encourage sensible decisions, there is more to be done that can't be done externally. I'll have more on my future-looking perspective and goals in other forums.

Sunday, December 14, 2014

GVEA Capital Budget for 2015

The board is meeting today in executive session to discuss and then (coming out of executive session) to approve the 2015 Capital Budget.     The proposed budget is documented on GVEA's site in the member book packet but is roughly $107 million, including $80 million for Healy Unit 2 restart.

GVEA projects $21 million principal payment on debt and additional loans and other financing of $94 million.

Big chunk of change.   You can read the details starting on page 18 of the member book located here.

Thursday, December 04, 2014

Rate history

I was just looking at my electric bill history and thought it might be interesting to see how rates have changed from past years.  I went back to 2010 and below are the rates.

There are two major components to consumption:  Utility charge and energy charge.  

The utility charge is everything not related to the cost of energy, such as operations, administration, legal, interest, depreciation and payment on loans, distribution and transmission costs.

Energy charge is everything that is related to the cost of energy.  It was formerly known as COPA - the cost of power adjustment and meant to allow a utility to change their rates based upon the fluctuating cost of energy (oil, gas, coal, etc.)  What is allowed to be included is set by the Regulatory Commission of Alaska.  For example, some years ago GVEA asked that the cost of ash disposal from the Healy coal fired power plant be allowed to be included in the COPA (the RCA said yes).    More recently, GVEA had asked to include the cost of building Eva Creek wind farm in COPA, as there is no energy charge from wind.   GVEA withdrew that request after realizing that the RCA wouldn't rule on it in time for it to be of financial advantage to GVEA.

Both rates are initially set after a rate study, which GVEA only does when there is a major shift in the numbers, such as inclusion of a new power plant.   Such studies cost over a million dollars so not to be done lightly.  

The utility charge is allowed to be changed in the interim every 6 months through a SRF (simplified rate filing) to the RCA, but not more than 8% in a year.    The energy charge can be changed quarterly and is subject to this complex formula.

In addition to these two charges, there is a fixed customer charge for the  cost of having a meter, regardless of whether you use electricity or not and then a very minor regulatory charge to compensate the RCA for overseeing the public interest of utilities,

If you are a large commercial or industrial customer, you will have a lower utility rate, but then also have a demand charge, based upon your peak consumption for the past 12 months.   GVEA talks about all these charges on their website.   They do have a handy bill calculator as well.  It would be interesting to have a table like below that would go back further.

So here is the last 4 years of rates by month.

Month  Utility   Energy  Subtotal
Dec-14  $  0.10341  $  0.09947  $0.20288
Nov-14  $  0.10341  $  0.10378  $0.20719
Oct-14  $  0.10341  $  0.10378  $0.20719
Sep-14  $  0.10341  $  0.10378  $0.20719
Aug-14  $  0.10341  $  0.10593  $0.20934
Jul-14  $  0.10341  $  0.10593  $0.20934
Jun-14  $  0.10341  $  0.10593  $0.20934
May-14  $  0.10001  $  0.09496  $0.19497
Apr-14  $  0.10001  $  0.09496  $0.19497
Mar-14  $  0.10001  $  0.09496  $0.19497
Feb-14  $  0.10001  $  0.09631  $0.19632
Jan-14  $  0.10001  $  0.09631  $0.19632
Dec-13  $  0.09724  $  0.09631  $0.19355
Nov-13  $  0.09724  $  0.10576  $0.20300
Oct-13  $  0.09724  $  0.10576  $0.20300
Sep-13  $  0.09724  $  0.10576  $0.20300
Aug-13  $  0.09724  $  0.08774  $0.18498
Jul-13  $  0.09724  $  0.08774  $0.18498
Jun-13  $  0.09724  $  0.08774  $0.18498
May-13  $  0.09597  $  0.11078  $0.20675
Apr-13  $  0.09597  $  0.11078  $0.20675
Mar-13  $  0.09597  $  0.11078  $0.20675
Feb-13  $  0.09597  $  0.10802  $0.20399
Jan-13  $  0.09597  $  0.10802  $0.20399
Dec-12  $  0.09004  $  0.10802  $0.19806
Nov-12  $  0.09004  $  0.13768  $0.22772
Oct-12  $  0.09004  $  0.13768  $0.22772
Sep-12  $  0.09004  $  0.13768  $0.22772
Aug-12  $  0.09004  $  0.12379  $0.21383
Jul-12  $  0.09004  $  0.12379  $0.21383
Jun-12  $  0.09004  $  0.12379  $0.21383
May-12  $  0.09004  $  0.12527  $0.21531
Apr-12  $  0.09004  $  0.12527  $0.21531
Mar-12  $  0.09004  $  0.12527  $0.21531
Feb-12  $  0.09004  $  0.12737  $0.21741
Jan-12  $  0.09004  $  0.12737  $0.21741
Dec-11  $  0.08791  $  0.12737  $0.21528
Nov-11  $  0.08791  $  0.10924  $0.19715
Oct-11  $  0.08791  $  0.10924  $0.19715
Sep-11  $  0.08791  $  0.10924  $0.19715
Aug-11  $  0.08791  $  0.10943  $0.19734
Jul-11  $  0.08791  $  0.10943  $0.19734
Jun-11  $  0.08791  $  0.10943  $0.19734
May-11  $  0.08337  $  0.10051  $0.18388
Apr-11  $  0.08337  $  0.10051  $0.18388
Mar-11  $  0.08337  $  0.10051  $0.18388
Feb-11  $  0.08337  $  0.08929  $0.17266
Jan-11  $  0.08337  $  0.08929  $0.17266
Dec-10  $  0.08337  $  0.08929  $0.17266
Nov-10  $  0.08337  $  0.09137  $0.17474
Oct-10  $  0.08337  $  0.09137  $0.17474
Sep-10  $  0.08337  $  0.09137  $0.17474
Aug-10  $  0.08337  $  0.09401  $0.17738
Jul-10  $  0.08337  $  0.09401  $0.17738
Jun-10  $  0.08337  $  0.09401  $0.17738
May-10  $  0.08337  $  0.09890  $0.18227
Apr-10  $  0.08337  $  0.09890  $0.18227
Mar-10  $  0.08337  $  0.09890  $0.18227
Feb-10  $  0.08337  $  0.09886  $0.18223

Tuesday, September 16, 2014

In the meantime ... transmission improvements

With all the moderate knashing of teeth regarding the proposed regulation of carbon dioxide by the EPA (WAY past time, in my view) and giving the responsibility for reduction to the states to work out, this recent article in the Alaska Journal of Commerce caught my eye.   Maybe what the State of Alaska will kick in more money for upgrading tie lines and then require GVEA to mothball a coal fired power plant?   Or maybe, not mentioned in the article, Aurora Energy would convert to natural gas?  That would go a long way toward cleaning up downtown and still serve the core areas with district heat, but would certainly change the dynamic especially as far as steam goes.

Readers may recall reading about the various $900 million in recommended transmission improvements in a report from the Alaska Energy Authority.  It didn't include proposed trucked natural gas in its projections, but is still draft.

And with all the spare capacity in the railbelt, there doesn't appear to be any crying need for Susitna.

So many moving parts.

Monday, September 15, 2014

Notification system progress

I had a meeting with Mike Wright and Lynn Thompson at GVEA today to discuss (at long last) price signaling and member notification. Mike laid out a case where GVEA's fuel balance, especially once Healy 2 comes on line, doesn't really demonstrate a need to balance peaks most of the time. Demand varies from roughly 120 mw in the summer to 210 mw in the winter.

Our supply is: Baseload resources

  • Healy 1 - coal - 25mw capacity - .065/kwh
  • Healy 2 - coal - 50 mw capacity - price TBD once operational in 2015 or 2016 but likely about .105
  • Aurora - coal - 23 mw on a 25 year remaining take-or-pay contract, ending 2031 - about $.06/kwh

    Load following (i.e. flexible on/off and capacity adjusting)
  • South Central economy natural gas - up to 78 mw - $.095-$.115 - across the Northern Intertie
  • North Pole expansion plant (LM6000) - oil (new contract with Petro Star), 65 mw capacity - $.26 kwh, but only .16 kwh in co-generation mode
  • North Pole 1 and 2 - oil - Qty 2 60 mw - $.25/mwh - no cogeneration and older so more expensive
  • Zender 1 and 2 - oil - Qty 2 x 18 mw - $.30/mwh
  • John Brown formerly Chena 6 - $.60/mwh - located in Delta, only used in emergencies

    Renewable sources
  • Bradley Lake, hydro, 24 mw capacity, $.05/kwh - cycled base upon need
  • Eva Creek - wind - 24 mw capacity, $.00 (no cost)/kwh, sometimes can't use as other baseload resources already covering.

  • The look above, once we have Healy 2 on line, is that except in the deep winter, we won't be taking much natural gas from Anchorage as it runs about the same price as Healy 2 is expected to.
    All this being said, there are other reasons to have a notification system.

    One of the challenges and opportunities is that GVEA's contact info on members is way out of date, especially as far as cell phones and email. This would be an opportunity to get updated. Perhaps this could be a MAC job?

    GVEA might consider an inexpensive notification system such as FNSB Air Quality Dept is now rolling out (3rd party alertmedia.com , a Nixle like service) with an in-house Google form to sign up. Notifications could be for a variety of reasons: outages, price signaling, board and annual membership meetings, RCA hearings, etc.

    I was told that GVEA is anticipating spending $300,000 in a future budget to upgrade their outage notification system with lots of bells and whistles. Maybe this is way too much? As it is now, it appears that Facebook offers more information about outages in progress than any other form of communication.

    So we will see where this goes.

    Thursday, June 12, 2014

    Ballot counting #4 - incumbents retain their seats

    It appears that the incumbents retained their seats. Still pending all the final numbers, but what I have are the winners with at least 40% of the vote. District 1 - Aren Gunderson - 471 votes District 2 - Tom DeLong - 506 votes District 3 - Rick Schikora - 363 votes (this was a 3 way race) An update on ballots that weren't countable due to deficiencies - it was 363. That's a lot, but typical, I'm told. While there are clear instructions on the process, I think that there should be a revisit of the multi-step process as it seems disrespectful to discount so many ballots where people at least made the effort to vote. Here are the more complete results.

    Ballot counting #3

    All acceptable ballots have been counted and are entered into the scanner. There are over 200 ballots that weren't on the other count due to deficiencies such as no signature on the outside or wrong signature. 10 were accepted that were delivered to GVEA offices instead of the official address. One rejection was a person whose wife had signed as the person had died some months ago. It is being held in abeyance as the signature didn't indicate she was a personal representative of her deceased husband. The computer will then be spitting out results shortly.

    Ballot counting #2

    An hour plus has past now and ballots are still be counted. 874 have been counted, roughly one third. The way it works is the ballots are removed from the envelope by the MAC in blocks of 50. They are then counted to make sure there are 50, then collected as a block and given to the person who then scans them into a portable counting machine. Because each district ballot is differennt, the machine knows the difference between districts. Unlike some previous years before the election process was outsourced, there won't be any real interim results, just a final one. Note that board members John Sloan and Chris Bunch are official observers, with candidate Tom DeLong stopping by, listening to MAC member Heidi Titchenal.

    GVEA Board of Directors counting of ballots

    GVEA is counting ballots received for the board of directors for districts 1, 2, and 3 this afternoon and evening in the board room of GVEA off Illinois St. All GVEA members are welcome to observe. Members of the MAC board will be doing the counting. You can read about the folks running on the GVEA website. Here are some opening numbers: District 1 Ballots mailed out: 6027 Ballots received: 882 Percent voting: 14.6% District 2 Ballots mailed out: 6249 Ballots received: 871 Percent voting: 13.9% District 3 Ballots mailed out: 6849 Ballots received: 811 Percent voting: 11.8%

    Friday, June 06, 2014

    Proposed EPA rules to limit carbon dioxide emissions

    For decades, there has been attempts to limit carbon dioxide emissions at local, state, national and international levels. Since the intent is to reduce climate disruption that known no borders, getting agreement to take action has been challenging, to the say the least. The argument from those opposed to such reductions is that it will cost the economy by raising the price of energy. This might be true if one ignores the external costs of using fossil fuels (the primary source of CO2 in this case) and the cost of adapting to the wide range of effects to our world from climate disruption. Carbon credits have been used in Europe and elsewhere, while a carbon tax has been resisted successfully. The idea that we need to reduced our CO2 emissions isn't new and any responsible group or individual that is in the policy side of power plant production should be aware of this. Earlier this week, the U.S. Environmental Protection Agency issued a set of regulations that is up for comment. The regulations are intended to bring down the level of CO2 emissions from power plants overall and to do so on a statewide, not on just a per-power-plant basis. The proposed rules have already generated a lot of politicizing, which is unfortunate though predictable. I mean, does one really think that the intent of the EPA and Obama Administration is to 'destroy the economy'? The cost of mitigating CO2 is not well known because the concept of sequestering it is still pretty experimental. The cheapest way to reduce CO2 emissions is to not generate them. This is why the EPA proposed guidelines has a goal of reducing the carbon pollution emitted for each megawatt-hour of electricity generated and not necessarily eliminate coal fired power plants that can't reduce the CO2 output. GVEA is one of the few power companies in Alaska using coal for generation. With a 25 mw older coal plant in operation, GVEA recently committed nearly $200 mm to purchase, refurbish and install selective catalytic reduction (of nitrous oxide) equipment for Healy 2, a 1990's era experimental power plant. The loans GVEA is using are for 30 years, meaning that we owner-members will be paying debt in excess of the face value of the loan for that long. Coal plants typically cost twice as much as a natural gas fired power plant to construct, while the coal as a source of fuel is currently cheaper. This is what drives GVEA to use coal, because they can defer paying the piper and hope that they can not have to address cost of mitigating CO2. I have argued that is a false hope and believe it is irresponsible. GVEA seems to love new projects and in the 5 years since we members allowed the board to not be restricted in borrowing, GVEA has roughly doubled the amount they have committed to borrowing than the previous limit of $450 million book value. I find that scary for members who will be paying off these loans for decades in their utility charge. The utility charge is roughly half of your bill with energy charge from the cost of producing the energy the other half. However, with the demonstrated need to reduce our CO2 emissions worldwide, for the life of me, I don't see the need to take on more long term debt that we can't get out of. There is a surplus of natural gas fired electricity in Southcentral now. Matanuska Electric has overbuilt generation, Munipal Light and Power (Anchorage) has surplus, Homer now has their own generation. Chugach, which formerly sold power to these utilities, now has surplus to sell as a result. GVEA had considered an option to build a natural gas fired power plant in Southcentral, but then would want more tie line capacity to Healy. These discussions were in executive session, so we don't know all the considerations. We are limited to 78 mw across the 138kv Intertie from Southcentral that terminates in Healy. We have roughly double that between Healy and Fairbanks. The Intertie can be upgraded relatively easily as the towers and insulators and some equipment is already designed for double that voltage. The point here is that a more efficient transmission network could allow us to take advantage of cleaner power throughout the Railbelt. The Alaska Energy Authority has a Railbelt Transmisson Plan that details where constraints and improvement might help us further the goal of cleaner and more efficient energy. Caveat: it's a detailed study and the costs aren't insignificant. Instead of a knee-jerk objection to the EPA, we might instead work toward our long term best interest of economic and cleanly generated electricity.

    Saturday, May 10, 2014

    Board meeting upcoming Mon. May 12

    Early this month, the next GVEA Board meeting will be held May 12, 2014. The member book has just been uploaded today and has some interesting items up for discussion and approval.

  • A proposed review of Healy 1 coal fired power plant operations and GVEA organizational structure and strategy for $130,000 plus travel and per diem for a consultant.
  • An investment policy for the funds put aside in a 'sinking fund' to pay back the balloon payment for the N.P. expansion plant construction bullet loan from some years ago. GVEA only pays interest at present, but is putting aside funds annually to be adequate to pay back the principal when due.
  • Finally, there was one late addition - a resolution to approve a fuel purchase agreement from Petro Star that was prompted by the upcoming closure of the Flint Hills Refinery. This was reported in the Fairbanks Daily News Miner May 9, 2014.

    People around town have commented on the lack of quorum for the recent annual meeting. I don't see this on the agenda, but perhaps it will be discussed under board member comments.