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Home My WebLink AboutRES2025-110 Allocat Funds for Mount Marathon Hydro ProjectSponsored by: Sorensen CITY OF SEWARD, ALASKA RESOLUTION 2025-110 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AUTHORIZING THE CITY MANAGER TO ALLOCATE FUNDS FOR THE MOUNT MARATHON HYDRO PLANT REHABILITATION PROJECT IN THE AMOUNT OF $400,000 AND APPROPRIATING FUNDS WHEREAS, the City of Seward owns the Mount Marathon Hydro Plant, which historically provided renewable energy to the Seward Electric Utility and remains structurally capable of producing hydroelectric power; and WHEREAS, the plant's current generator can produce approximately 250 kW of renewable power, and preliminary analysis from Seward Electric System (SES) Operations indicates that restoring the plant to operational status at this output could offset approximately $277,000 per year in Cost of Power Adjustment (COPA) costs when run 60% of the year; and WHEREAS, SES Operations has developed a rehabilitation plan based on City of Seward's traditional purchasing methods, with a total proposed budget of $400,000 to fund equipment, materials, and labor needed to return the hydro facility to service; and WHEREAS, this rehabilitation plan will leverage cost -saving opportunities by allowing SES Operations to purchase equipment through government surplus auctions, significantly reducing capital expenditures compared to retail procurement; and WHEREAS, the project includes installation of new switchgear and control systems compatible with the existing 250 kW generator, ensuring operational safety and compliance with modern utility standards; and WHEREAS, successful operation of the existing generator will serve as a proof of concept for future expansion up to a 600-kW generator, further increasing Seward's renewable generation portfolio and reducing long-term reliance on purchased power; and WHEREAS, the project will also provide local educational benefits through collaboration with AVTEC and the Seward school system, enabling hands-on learning opportunities for students interested in renewable energy and hydroelectric systems; and WHEREAS, by rehabilitating the Mount Marathon Hydro Plant, the City of Seward demonstrates a commitment to renewable energy development, local sustainability, and community engagement in shaping Seward's energy future. CITY OF SEWARD, ALASKA RESOLUTION 2025-110 Page 2 of 2 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: Section 1. The City Council hereby authorizes the City Manager to allocate funding in the amount of $400,000 to the Mount Marathon Hydro Plant Rehabilitation Project, authorizing Seward Electric System Operations to proceed with procurement and rehabilitation activities in accordance with City purchasing policies. Section 2. Funding of $400,000 is hereby appropriated from the Electric Enterprise Fund Hydro Project expense account 15000-3000-7XXX-0161, authorized for both materials and contracted services necessary to restore the hydro plant to operational condition. Section 3. This resolution shall take effect immediately upon adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska this 17th day of November 2025. THE CITY OF SEWARD, ALASKA Sue McClure, Mayor AYES: Barnwell, Crites, Osenga, Calhoon, Draper, McClure NOES: None ABSENT: Warner ABSTAIN: None ATTEST: v Kris Peck City Clerk (City Seal) 1 1 1 City Council Agenda Statement Meeting Date: November 17, 2025 To: City Council Through: Kat Sorensen, City Manager From: Taylor Crocker, Electric Operations Supervisor Subject: Resolution 2025-110: Authorizing the City Manager to Allocate Funds for the Mount Marathon Hydro Plant Rehabilitation Project in the Amount of $400,000 and Appropriating Funds Background and justification: The Mount Marathon Hydroelectric Plant was originally constructed to provide renewable generation for the Seward Electric System (SES). The existing facility remains structurally sound, with the turbine and generator components intact but in need of modernization to meet current operational and safety standards. The plant's generator is rated at 250 kW and can be operated approximately 60 percent of the year based on available streamflow, equating to an estimated annual savings of $277,000 to the City's Cost of Power Adjustment (COPA). Seward Electric Operations has developed a rehabilitation plan that focuses on restoring the existing plant to operational condition through the installation of new switchgear and control systems, system protection relays, instrumentation, and auxiliary electrical components. The project budget of $400,000 will allow SES Operations to perform the majority of the work in- house and procure materials using government surplus auctions and other cost-efficient purchasing methods. This approach is expected to provide significant savings compared to traditional full -retail procurement. Beyond financial and operational benefits, the project presents valuable educational opportunities through partnerships with AVTEC and the Seward School District, offering students real -world exposure to renewable energy systems, instrumentation, and hydroelectric operations. Rehabilitating this facility will also serve as a visible demonstration of Seward's commitment to renewable energy and sustainability while laying the groundwork for potential future expansion to a 600 kW generator. Comprehensive and Strategic Plan Consistency Informatio This legislation is consistent with (citation listed): Comprehensive Plan: Strategic Plan: Other: Total amount of funds listed in this legislation: $ 400,000.00 This legislation (✓): Creates revenue in the amount of: Creates expenditure in amount of: Creates a savings in the amount of: Has no fiscal impact x Funds are (✓): Budgeted Line item(s): 15000-3000-7009, 15000-3000-7221 X $ $ 400,000.00 $ Not budgeted Not applicable 1 Fund Balance Information Affected Fund (✓): General Boat Harbor Motor Pool Available Fund Balance X SMIC Parking Other Yes x Electric Water Attorney Signature: Not applicable Comments: $ Wastewater Healthcare Note: amounts are unaudited Finance Director Signature: Attorney Review SZ4 9Zed"ti' Administration Recommendation X Adopt Resolution Other: