Strategic Issues Discussion Paper - Alternatives to Burning Diesel Fuel to Generate Electricity

Trans-Alaska Gas Line Projects  - 

Major Considerations to Address before Using Gas as a Fuel Source to Displace Diesel Fuel  - 

LNG as a Fuel Supply to Replace Diesel Fuel  -  Ahtna 1-19 Gas Well

Trans-Alaska Gas Line Projects  One of the most significant unknown factors influencing long-term power supply planning is any version of a trans-Alaska gas line (TAGS) project that would come to Glennallen and/or Valdez.  If it happens, and depending upon the cost per mmbtu of the gas and the capital investment required to convert it into electrical energy, it could provide economic benefits for generations to come.  CVEA’s Board of Directors keeps a watchful eye on any version of a TAGS project that would benefit the region but does not assume, for planning purposes, that the project will come to the region in any particular timeframe.

What are the Major Considerations to Address before Using Gas as a Fuel Source to Displace Diesel Fuel  There are a host of economic and technical issues that would need to be considered before a decision could be made to use natural gas.  The first would be the price of natural gas at the delivery point and the cost to get the gas to the CVEA power plant.  The second issue would be the reliability of the gas resource to include a guaranteed supply and gas conditioning systems.  The third would be to determine whether or not to install new units or retrofit existing units in the Glennallen Plant, as they are currently ported to use natural gas.

LNG as a Fuel Supply to Replace Diesel Fuel  The world has a lot of natural gas.  Liquefied natural gas (LNG) may be the fuel of the future in certain areas dependent upon liquid fuels.  Environmental issues may dictate LNG displaces other liquid fuels.  CVEA has had preliminary discussions with potential providers of LNG concerning an alternative fuel source for the Glennallen Diesel Plant.  While the cost savings compared to diesel fuel appear marginally favorable, this option must be thoroughly investigated.  Some of the considerations which must be carefully evaluated include transportation costs, storage, re-gasification equipment, and the capital cost to retrofit existing reciprocating engines (or new equipment).  In addition, availability of long-term supply, price changing mechanisms, seasonal demand versus supplier production limitations, and considerations for supply interruptions are other important considerations.  CVEA continues to investigate LNG as a potential alternative to diesel fuel.

Ahtna 1-19 Gas Well  CVEA continues to monitor developments on local natural gas.  Specifically the exploratory well site known as Ahtna 1‑19, ten miles west of Glennallen and one-half mile north of the Glenn Highway, has been closely tracked.  Despite technical difficulties, the operator is hopeful that they can get their well tested before winter.  Should natural gas produced by Ahtna 1-19 become available, CVEA will certainly evaluate the commercial opportunity.

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