Old Harbor hydroelectric powerhouse gets millions in funding to help finalize project that will benefit all residents

The village of Old Harbor, on the southeast side of Kodiak Island, is one step closer to building a hydroelectric facility that would power the entire community of roughly 200 people. The rural energy project is getting a $10 million grant from the U.S. Department of Energy to help fund construction.

Last month on Feb. 27 the department announced up to $125 million for five energy development projects in rural Alaska. About a tenth of that federal funding will allow the Alutiiq Tribe of Old Harbor to construct a run-of-river facility, pipeline, powerhouse and electric transmission line. A diversion or run-of-river facility involves channeling a portion of a river through a canal and/or a penstock to utilize the natural decline of the river bed elevation to produce energy. This is one of three main types of hydropower facilities and does not have to use a dam.

Cynthia Berns is a project manager for the Alutiiq Tribe of Old Harbor. She is also Vice President of Community and External Affairs at Old Harbor Native Corporation. Berns said once constructed, the hydroelectric project could offset Old Harbor’s current, power plant diesel fuel usage by 95%. And it’s expected to generate 3,470 megawatts per hour, each year.

“We structured it where the Alutiiq Tribe of Old Harbor will have ownership of the project, they will cover operations and maintenance,” Berns stated. “And then we will be providing a utility subsidy for our residents by paying for all the water and sewer bills for community members in Old Harbor, as well as a subsidy paid directly to [our local utility] AVEC for electric bills.”

According to project details listed on the DOE’s website, “the Tribe intends to sell hydropower generated through the project to local utilities for 80% of the avoided cost of a gallon of diesel fuel.”

The plan is to place the powerhouse at the end of the road in Old Harbor where the Alaska Army National Guard Innovative Readiness Training site is located. The pipeline will go up the hillside to a mountain west of the community where it will connect to the main facility. According to Berns, the environmental assessments that have been completed indicate the hydroelectric project will not impact local fish populations.

Berns said the project has not yet reached the 35% design phase, and the final budget is still being worked out.

“This budget was established quite some time ago and with inflation and cost of construction, we will be continually looking for other opportunities to ensure that we have adequate funding. We won’t have the final budget number until we get our design closer to 35%,” Berns said.

Aside from the $10 million from DOE’s Office of Clean Energy Demonstrations, which Old Harbor Native Corporation is matching a quarter of, the hydroelectric project also received a $1 million grant from the Denali Commission.

Burns anticipates the design phase will be completed next year, while construction could be finished in 2029. Old Harbor’s hydroelectric project is meant to demonstrate a model of tribal business ownership for other rural communities around the state.

Nearly a dozen other rural energy projects in Alaska were included in last month’s federal funding announcement, which affects the communities of Angoon, Anvik, Chignik Bay, Grayling, Holy Cross, Huslia, Kaltag, Nulato, Shageluk and the Northwest Arctic Borough.

U.S. Sens. Lisa Murkowski and Dan Sullivan welcomed the news in a joint statement, with Murkowski saying, “these investments will create jobs, reduce emissions, and increase the use of renewable resources while decreasing electricity bills.”

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