April 09, 2006
Sunday

Ketchikan, Alaska - The people of Ketchikan have been hearing about the 57 mile Swan Lake-Tyee Lake Intertie Project for more than 10 years. So why now, why bring it to the forefront of public interest at this time?

Dave Carlson, CEO of the Four Dam Pool Photograph by Marie L. Monyak

Those attending the Greater Ketchikan Chamber of Commerce luncheon this week benefited from an informative presentation by Dave Carlson, CEO of the Four Dam Pool, who explained why the project is so important to the people of this area and why there is such an urgency to gather the support needed to complete this project.

"Alaska got left behind when the West was electrified," Carlson stated. "In the Pacific Northwest, Bonneville came in and built the hydro plants; [they] built the transmission lines throughout the Northwest. Bonneville still owns those transmission lines. Alaska, as far as I'm concerned, got left in the dust. We're in the 1910's compared to the rest of the nation. We need an integrated system so we can be like everybody else."

To better understand the electric power infrastructure (or lack thereof) in Southeast Alaska it helps to understand where it all began. Based on research, Bonneville, which Carlson was referring to, is in fact the Bonneville Power Administration, a federal agency of the U. S. Department of Energy that was created by Congress in 1937. For two decades, from 1940 through 1960, Bonneville constructed the transmission lines that provide power to most of the Northwest United States. But not Alaska.

The initial Four Dam Pool was established by the Alaska Legislature in 1981 and owned and managed by the Alaska Energy Authority. The pool consists of four dams/hydroelectric projects; Swan Lake, Tyee Lake, Terror Lake and Solomon Gulch. In 2002, an agency formed by the utilities that purchase power from the projects, purchased the initial project and became the Four Dam Pool Power Agency.

There are five communities served by the four dam pool; Ketchikan, serviced by Ketchikan Public Utilities which operates Swan Lake, Wrangell and Petersburg, serviced by the Tyee Lake facility under the Wrangell Light and Power Company, Kodiak, run by the Kodiak Electric Association and serviced by Terror Lake and lastly Glennallen and Valdez, serviced by the Solomon Gulch Project and run by the Copper Valley Electric Association.

The Four Dam Pool Power Agency is governed by a Board of Directors. Of the three municipalities (Ketchikan Public Utilities, Petersburg Light and Power, Wrangell Light and Power) and the two cooperatives (Kodiak Electric Association, Copper Valley Electric Association) a member is appointed to the board with one alternate each. In Ketchikan, Mayor Bob Weinstein sits on the board with Steve Williams as the alternate.

The area of interest that Carlson presented to the Chamber was the planned intertie from Ketchikan's Swan Lake to Tyee Lake, south of Wrangell which would, as Carlson stated, "control our energy future and our economic destiny."

Carlson informed the audience, "Where we are right now; we have 57 miles of line for the Swan Tyee intertie, all the right of way has been cleared and 50% of the foundations are installed." He quickly added, "What we need is 50 million dollars to complete the project and obviously it will deliver a lot of surplus down from Tyee to Ketchikan."

Because of Wrangell's size and low power consumption, the Tyee Lake Project is largely underutilized. With the Intertie, that excess power can be funneled down to Ketchikan.
"We have all kinds of surplus at Tyee today that we could sell," Carlson explained. "We could sell it for a penny and make money because it doesn't cost us any more to produce it."

Because of this surplus, the cities of Wrangell and Petersburg are starting a program to figure out how to convert their governmental buildings to electric power. According to Carlson the maintenance costs of an oil furnace versus electric heat is much higher and as he said, "the environmental benefits are a no-brainer."

The Economic Analysis completed in February 2006 was a topic Carlson explained in some detail. One of the most important things residents need to know is that the ratepayers would be responsible for the operating and maintenance costs once construction of the intertie is complete and the analysis addressed this issue.

The Swan Lake Project is located approximately 22 air miles northeast of Ketchikan, Alaska, on Falls Creek which drains from Swan Lake to Carroll Inlet on Revillagigedo Island. Photograph by Mike Martin ©

The consultants were charged with determining the annual operating and maintenance costs. Carlson explained, "Based on their analysis, they predict an annual O & M cost of a half million dollars but the revenue coming over the line will exceed the total operating costs, however there will be years when that won't be the case." He further explained that years of surplus would cover the lean year.

The Four Dam Pool finances were also discussed. Based on information from their website, when the Four Dam Pool Power Agency purchased the project for $73 million in 2002, they pledged $.04 of every kilowatt hour purchased to repay the loan to the to the Alaska Industrial Development and Export Authority (AIDEA).

According to Carlson, "The only money we've gotten so far is federal money plus program receipt money. What I mean is, for every kilowatt hour you purchased from the Four Dam Pool back in the 90's, you paid $.04 to the state. 40% of that $.04 went into the intertie (it was around 15 million through those years). This 40% of the $.04 now goes to the Four Dam Pool to pay our debt service and to pay all our replacements and do all the renewals."

Over and over Carlson stressed the need for 50 million dollars to complete the Swan Lake-Tyee Lake Intertie Project. He volunteer advice for residents saying, "What Ketchikan can do is agree to cover the O & M costs, not proceed with any additions or upgrades to local hydros because it directly impacts the economics of the intertie and to let the governor know that we need this project done and funded. And we need to let the legislature know we want it, especially southeast legislatures."

Currently, Swan Lake provides 50% of Ketchikan's power. The City of Ketchikan website lists Beaver Falls hydro, Silvis Lake Hydro and Ketchikan Lakes hydro as the additional resources.

"We've spent over 50 million dollars on this project so far." Carlson said. "If it were to be abandoned, it would be one huge black eye on the State and on Southeast." He did add various bits of encouraging information. To those concerned with the environment he said, "The power that the Four Dam Pool sells out of the hydros, to the communities, displaces about 25 million gallons of diesel a year."

In terms of economics, Carlson said, "Hydro produces stable power, whereas diesel averaged $50 a barrel in 2005 and now in 2006 it's around $60 to $65 a barrel. Oil prices are high and the forecast doesn't predict them going down, yet here we live in the land of hydro. We live in a rainforest, the rain is a fuel, it powers the turbines and the rain is free so we need to utilize it."

"Swan-Tyee is totally permitted and designed, we just need the money," Carlson stated. "The number the Four Dam Pool came up with to ask the state for is $40 million, and we thought we could get $10 million from Senator Stevens. The permits are going stale, (special use permits), they're only good till 2007."

"This is going to take some shouting and yelling and my advice to you is to call Senator Stedman and the Governor and Representative Peggy Wilson and say we want this project done! If abandoned, we stand to lose $55 million that's been already invested," Carlson said in closing.

Russell Thomas of the Ketchikan School Board will be the invited guest speaker at the next Chamber lunch to be held at noon at the VFW on Tongass Avenue Wednesday.



On the Web:

The Four Dam Pool Power Agency website:
http://fdppa.org/servlet/content/1.html

Ketchikan Public Utilities, electric division website:
http://www.city.ketchikan.ak.us/public_utilities/electric.html

Marie L. Monyak is a freelance writer living in Ketchikan, Alaska.
A freelance writer is an uncommitted independent writer
who produces and sells articles to a publisher such as SitNews.
Contact Marie at mlmx1[at]hotmail.com

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