Energy Update

Hello everyone,

The House Special Committee on Energy just wrapped up a very busy week here in Juneau so I thought it would be good to bring everyone up to speed on what we are working on.

On Tuesday, the committee got an interesting overview of the coal industry from Steve Denton with Usibelli Coal Mine Inc. Steve gave a great presentation loaded with good information. Alaska’s coal reserves are staggering. The challenge for the industry is figuring out how to develop that vast resource economically if congress and the Obama Administration go forward with legislation that restricts carbon emissions.

We also moved out HJR 25, a resolution urging congress to classify hydroelectric power in Alaska as a renewable energy source. That’s very important because unlike the Lower-48 water is plentiful in Alaska and hydroelectric power generation is environmentally friendly. Alaska already generates about 25 percent of its electricity from hydroelectric dams.

A bill sponsored by the Palin Administration was also heard that brings all six railbelt electric utilities into a new public corporation for the purpose of building and operating new power generation plants. On one level the bill (HB 182) makes a lot of sense. Some of the railbelt utilities have aging power plants that will need to be replaced at a tremendous cost or they have no power generation facilities at all. Having all six utilities pool their resources could make power more affordable for the average consumer and promote economic growth.

The trick is to bring all six utilities together in a way that makes sense for each one – that will not be easy. The energy committee will continue to work with the administration and the utilities to see if the proposal can be made to work.

Today the committee held a Saturday meeting to hear two pieces of legislation dealing with natural gas pipeline issues. HB 163 essentially changes the mission statement for the Alaska Natural Gas Development Authority. If passed, ANGDA’s scope will be to provide natural gas for Alaskans from any source in the state.

The question I’m asking myself is does changing ANGDA’s mission actually help get any pipeline project built? When ANGDA was created by a voter approved initiative in 2002 it was supposed to have a gas pipeline in operation by 2007. Obviously, that didn’t happen and so far the agency has received more than ten million dollars in state funding.

We also heard HB 164. It is legislation the administration believes is necessary to facilitate the construction of an in-state gas pipeline. It makes changes to right-of-way leases on state land and makes statutory changes designed to stimulate pipeline development.

Well, we have just three weeks left to go. I expect some long days ahead as the session moves closer to adjournment on April 19th.

Please feel free to contact me with any questions or comments you may have. I would love to hear from you. Hope you are having a great weekend!



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