GVEA Board Meeting, Aug. 24, 2020

by Jim Schwarber

On August 24, 2020 the Golden Valley Electric Association held its monthly Director’s Meeting. About six member-owners joined telephonically. Their comments ranged from adopting On-bill Financing, adjusting the net-metering cap if needed to accommodate the large number of new SNAP Plus solar PV providers resulting from the first year of the Solarize Fairbanks effort, to a request to utilize Zoom or similar for future Director meetings to provide a richer visual meeting experience. One owner urged the Directors to seize this historic opportunity to transition the utility to a cleaner and greener operation, recognizing that even smaller, local actions may have an outsized impact.

This was Director Bill Nordmark’s last meeting. The other Directors expressed their appreciation for his 25 years of service, and hope to be able to gather in person, perhaps at GVEA’s 75th Anniversary next year, for a traditional farewell.

Director Dave Messier shared a Safety Moment, reminding folks the importance of taking extra caution while driving in the vicinity of the many roadway construction zones around the community this summer.

Carbon reduction study

The main meeting business was a presentation by the Alaska Center for Energy & Power of their preliminary “GVEA Carbon Reduction Study.” This study will be finalized and formally presented to GVEA, perhaps in September. Therefore, this summary will only mention some of the initial findings, but not cover the entire 56 page PowerPoint presentation.

GVEA commissioned ACEP to conduct this study to assist GVEA in meeting its goal of a 26% reduction in carbon dioxide equivalent greenhouse gas emissions (CO2e) per megawatt-hour (MWh) from the 2012 rate by 2030. This goal was established by GVEA in 2019 in GVEA Policy 7.6. To achieve this goal, GVEA needs to shrink emissions from 0.89 tons/MWh in 2012 to 0.66 tons/MWh in 2030.

Meeting the 2030 goal will actually require a 32% reduction from last year’s emissions. GVEA’s 2019 emissions rose to 1.027 tons/Mwh because the co-op used less gas-fired generation and the coal-fired Healy 2 plant came online.

In addition to this reduction, the goal needs to achieve no long-term increase in rates and no adverse impacts on reliability. There are many challenges to this study, such as variability of different sources of fuel and electrical generation.

More work is needed to spell out a path to achieve the study’s goal. This report is not a full integrated resource plan; instead it is a high level overview of options. These options under consideration will require a pre-feasibility study for some, a feasibility study for most, an engineering study for all, and a staffing analysis for some of the options.

Some key points shared with the Directors include:

• Social costs and benefits are ignored by study – though noted;

• Storage is essential to reach long-term goals for carbon reduction;

• No “silver bullet,” or single solution that solves the entire problem;

• Can’t operate both Healy coal plants year round and still reach goal;

• Wind and solar production must be paired with diesel unless storage exists;

• Southcentral gas-fired generation availability has big effect on ability to reach goal by 2030.

Generation options include:

• Upgrade Healy 1 by 2024 for seasonal use or close by 2024;

• Purchase 60 MW LM-6000 gas turbine to replace North Pole 1 & 2 generation;

• Contract 16 MW regulated wind project or equivalent;

• Build out remaining Eva Creek wind farm capacity regulated by storage;

• A community solar project.

Consider beneficial electrification such as electric vehicle subsidies and charging stations, initiate residential on-bill financing for energy efficiency, generation and storage, and initiate support for C-PACE program.

A wide range of short and long-term decisions, both big and small, are laid out, including policy changes that would be helpful.

Two options – an “A” option that would involve closing Healy 1, and a “B” option that wouldn’t -- are proposed for meeting GVEA’s goal. A mix of associated decisions flesh out ways for meeting the goal by 2030. A possible third option is modifying Option A to include variable purchases of heat and power from the Aurora plant.

The Directors questioned Brian Rogers, the ACEP presenter, about contract mission creep and sticking just to generation decisions. Mr. Rogers replied that GVEA will also “need the smaller decisions to reach the [carbon reduction] goal.”

Transmission line acquisition

In other business the Directors unanimously adopted a “Resolution Approving the Terms and Conditions for Financing the Acquisition of the Soldotna to Sterling Transmission Line.” This item was on the Agenda but not included in the meeting packet. This line will make it possible to move more of Bradley Lake’s less expensive power to GVEA.

COPA increase, new admin building, vacant seat

The new COPA is expected to increase at the end of August; amount not shared. GVEA has requested a presentation for a new administration building concept from Jack Hebert.

Regarding Board appointment for the vacant District 7 seat, a question came up if a candidate for the legislature may also serve on the GVEA Board? At this time there is no By-Law restricting this situation. The meeting adjourned at 8:29 pm.