Vol. 27, No. 23 Week of June 05, 2022
Providing coverage of Alaska and northern Canada's oil and gas industry

A transmission upgrade

Click here to go to the full PDF version of this issue, with any maps, photos or other artwork that appears in some of the articles.

AEA, Railbelt utilities to modernize, boost capacity of Kenai Pen. system

Alan Bailey

for Petroleum News

The Alaska Energy Authority and the Railbelt electric utilities plan major upgrades to the electricity transmission system on the Kenai Peninsula at a cost in excess of $200 million, AEA announced on May 25.

The upgrades will modernize the system, reducing line losses and increasing the capacity of the system to carry power.

A primary purpose is to improve the delivery of power from the Bradley Lake Hydroelectric Project in the southern Kenai Peninsula - Bradley Lake produces the cheapest available power on the interconnected Railbelt electrical system that extends from the southern Kenai Peninsula, north to Fairbanks in the Interior.

The planned projects include upgrades to the transmission lines between Bradley and Soldotna, Soldotna and Sterling, and Sterling and Quartz Creek.

The plans also involve the installation of energy storage systems on the Kenai Peninsula, to improve the stability of power supplies over the grid.

Dixon Diversion Project

As previously reported by Petroleum News, AEA has recently decided to move forward with planning the Dixon Diversion Project, a project that could increase the power output of Bradley Lake by almost 50 percent. Use of this increased power output would require significant upgrades to the Kenai Peninsula transmission system, as envisioned in the transmission upgrade projects.

AEA also commented that the upgrades to the transmission grid will facilitate the integration of new renewable energy generation into the electrical system. Moreover, the increasing use of cost-saving power sales between utilities, together with the imminent implementation of regional integrated resource planning for the electrical system, strengthen the case for transmission system upgrades, AEA said.

“These projects will be the initial phase of some of the most significant improvements to the Railbelt electrical grid in Alaska’s history,” AEA said.

The planned work also involves a study into the possibility of constructing a second transmission path for shipping electricity between the Kenai Peninsula and Southcentral Alaska - the current transmission line that connects the peninsula to Anchorage via the northern side of the Turnagain Arm represents a single point of failure in the system and constrains the amount of power that can be shipped from or to the peninsula.

A number of years ago AEA suggested the installation of an undersea high voltage direct current transmission line between the northwest Kenai Peninsula and the old Beluga power station on the west side of the Cook Inlet.

Funding the projects

Bradley Lake is owned by AEA and managed by Bradley Lake Project Management Committee, with representatives from each of the five Railbelt electric utilities and AEA.

Given that the proposed transmission upgrades will support the Bradley Lake system to the benefit of electricity ratepayers, the BPMC has obtained approval to use bond funding associated with Bradley Lake to underwrite the $200 million cost of the upgrades, at no additional cost to ratepayers.

Essentially, although the bonds associated with the construction of Bradley Lake were paid off in 2021, under the terms of the power sales agreement for Bradley Lake, the utilities have continued to make annual payments associated with the debt service - those additional funds are now available for the transmission upgrades.

Support from Dunleavy

“With this historic upgrade to transmission lines, the Railbelt utilities and AEA are ushering in a new energy future in Alaska,” said Gov. Mike Dunleavy in reference to the planned Kenai Peninsula transmission upgrades. “By improving the Railbelt's transmission capacity, more of the power from the Bradley Lake Hydroelectric Project - the lowest cost energy in the state - will power Alaskan's homes and businesses from Homer to Fairbanks.”

Dunleavy also commented that the transmission upgrades would prepare the grid for the increased use of sustainable energy sources such as tidal, geothermal, solar, hydropower, wind and hydrogen.

“Early in his administration, Gov. Dunleavy met with AEA and the utilities and asked them to develop a plan to increase the reliability and resiliency of the Railbelt corridor,” said AEA Executive Director Curtis Thayer. “Working together this is the cornerstone of those efforts to achieve a more resilient system driven by low or zero carbon energy that supports a strong economy.”

“As the largest electric utility in Alaska, these investments come at a critical time for our members,” said Chugach Electric Association acting CEO Arthur Miller. “These projects increase the value of Bradley Lake to all consumers in the Railbelt from both a cost and reliability perspective and support the advancement of renewable generation for decades to come.”

A more integrated approach to the overall management of power generation and transmission in the Railbelt is also in the offing, with moves to implement an electric reliability organization for the region, to oversee the planning of the electrical system, open access to the system, and the use of a consistent set of reliability standards.

The Regulatory Commission of Alaska is currently considering an application by the Railbelt Reliability Council to form an ERO.

Print this story | Email it to an associate.

Petroleum News - Phone: 1-907 522-9469
[email protected] --- ---

This story has 1101 words, takes 2 min. to speedread and it is 2555 pixels high.