An expansion of the state’s largest hydroelectric facility is one step closer to becoming a reality. The Alaska Energy Authority’s Board of Directors approved a $46.6 million expansion of Bradley Lake, about 30 miles northeast of Homer, at its meeting earlier this month.
The Battle Creek project, as it’s known, will divert runoff from the Battle Glacier via a 1.7-mile pipeline, just upstream of the Bradley Lake dam.
The state-owned facility serves about 70 percent of Alaska’s population through six electric utilities along the Rail Belt. Each utility plays a role in operating Bradley Lake, and the nearly 380,000 megawatt hours it produces each year are divvied up between Golden Valley Electric, Chugach Electric, City of Seward, Matanuska Electric Association, Homer Electric Association and Municipal Light & Power.
AEA Chief Operating Officer Kirk Warren said the Battle Creek project will boost production at the site by 10 percent, but more importantly, it will help maintain water levels during the summer months.
“The utilities have to maintain a minimum water level, and when it gets down to that, they will have to decrease power coming from Bradley Lake,” Warren explained. “This will allow situations where they can get more power during times where they historically haven’t been able to.”
There is still plenty to figure out before the project’s expected completion in 2020, and funding is the largest hurdle. The AEA board examined five options at its meeting in early August.
The board intends to seek most of its funding through New Clean Energy Bonds, federal money set aside by the Obama administration for renewable energy projects. Warren said the board is looking to secure funding this fall, and he notes that waiting any longer could lead to higher interest rates. Just a 1-percent increase could tack on $10 million to the project.
“That’s the impetus for us to make the decision as quickly as possible. There’s no reason we have to believe that interest rate would ever go down,” Warren said. “So, the quicker we make a decision regarding getting that RFP on the street and locking in that interest rate, the better.”
There has also been talk of the Chugach Electric Association financing the project.
The wholesale price of electricity from Bradley Lake is expected to increase slightly, but hydroelectric power is typically cheaper than other traditional power sources. AEA expects that a more consistent supply from Bradley Lake will in-turn save electric utilities money.
Warren said the board has already approved brush clearing along the pipeline’s path, allowing potential contractors to make site visits next month. Bidding on the project is expected to open to in October, and work is likely to begin next spring.