AP&T: Studies rule out Schubee Lake hydro


Alaska Power and Telephone officials said this week the company is ruling out pursuing Schubee Lake as an alternative hydroelectric project to Connelly Lake.

Construction and operation of a hydroelectric project at Schubee Lake would be both expensive and “extremely difficult,” according to reports recently released by AP&T.

Several Haines Borough Assembly members and residents asked AP&T to investigate the feasibility of Schubee Lake as an alternative to the controversial Connelly Lake project, as the former would have no impact on fish habitat. In July 2011, AP&T obtained an $80,000 grant from the Alaska Energy Authority’s Renewable Energy Fund program to conduct such an investigation.  

A report by Anchorage-based engineering firm HDR Alaska Inc. determined that not only would construction and operation of a hydro plant at Schubee Lake be difficult due to its remoteness, high alpine location, and lack of a road, at about $15,300 per kilowatt, “the project is expensive by today’s standards.”

The project is estimated to cost nearly $75 million. An economic analysis released by AP&T this month indicated Schubee Lake “should be considered for development primarily if a large new industrial load (such as a mine) can be reasonably well-assured and there are no better alternatives for meeting that load.”

However, AP&T project manager Glen Martin said even the development of a mine or an influx of cruise ships would not necessarily make Schubee Lake worthwhile. Cruise ships are an “unpredictable market,” and mines, if they don’t operate for more than 50 years, don’t require the power needed to pay off such an expensive project, Martin said.

A series of complex calculations led AP&T to conclude the Schubee Lake project has a cost/benefit ratio of .81; the Alaska Energy Authority’s model put the ratio at .67. Statistically, a number greater than one indicates the benefits of a project outweigh the costs.

Based on the reports, Connelly Lake remains a better option for Haines and the Upper Lynn Canal in the eyes of AP&T, Martin said.

“I would certainly like to think that people would evaluate the Schubee information for what it is, and certainly from our point of view, it shows that Connelly is a better project. It’s less likely to have mishaps that would prevent generation of power to supply Haines. It also acts as a back-up for the whole Upper Lynn Canal,” Martin said.

Connelly Lake would not require a submerged submarine cable to transmit power to Haines, Martin explained. As it stands, Haines receives the vast majority of its hydro power through a submarine cable that brings power from hydro projects near Skagway, like Goat Lake.

“Having a project at the Haines end is much better than relying on a submarine cable forever and ever between Skagway and Haines. I think the bottom line is that’s kind of a tenuous connection and you never know when something is going to happen,” Martin said.

If the submarine cable failed (the average life of a cable is 30 years, and the one connecting Skagway and Haines was installed in 1998), it would leave Haines almost entirely dependent on expensive diesel fuel for six months to a year, Martin said.

Rob Goldberg, one of the concerned citizens who initially raised Schubee Lake as an alternative to Connelly, said that while the reports did a “pretty good job” of analyzing the site, they still possessed holes and left out possibilities.

“If they really tried to pursue this to get the cost down, I think there are probably ways they could do it,” Goldberg said.

The reports also used data gathered from nearby stream gauges and did not actually gauge output of Schubee Lake, Goldberg pointed out. “So they’re still working with an estimate rather than hard data,” he said.

Goldberg and Mayor Stephanie Scott, who also read the reports, said they would like to see similar recon studies and economic analyses for Connelly Lake for the sake of comparison.

Martin said AP&T does not have similar reports for Connelly Lake. “However, based on our preliminary work, we are confident that Connelly will be less expensive than Schubee and will have a greater generation potential; therefore it should be more economical than Schubee,” Martin said.

Scott said the borough currently has no official preference for either project. “We recognize the need for additional power, and that’s about where we are at this point in time. I think the borough recognizes the lack of affordable power being a barrier to development,” she said.

Martin said AP&T is pursuing an alternative licensing process through the Federal Energy Regulatory Commission (FERC) for the Connelly Lake project.


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