Alaska Dispatch

Summer 2008's record-breaking oil prices may have left Alaska's treasury flush, but they also sounded a wake-up call -- the people of the state were hurting under crippling fuel costs. Lawmakers promised to do something to assure reliable, affordable energy for Alaskans -- starting with an energy policy.

While world oil prices have leveled out, Alaska's reliance on fossil fuels has lawmakers looking for long-term solutions to wean the state off the single source and onto reliable, affordable alternatives.

Last winter in frigid Fairbanks, residents turned to wood stoves to supplant costly heating oil, aggravating air quality problems that could cost the community federal funding for roads and other projects. From rural villages came reports of families forced to choose between spending precious cash on heat or food.

As the session begins, legislators are closer to solutions, but far from settling on specific projects -- like an in-state gas pipeline or a large hydroelectric dam -- that would cost billions and take years to complete.

Last week, House and Senate committees working on energy issues rolled out broad policy bills and packages combining some of last year's 50-plus energy proposals. The policies are supposed to offer a vision to which leaders can turn for direction when evaluating future energy projects.

Lawmakers may buy in more easily to the policy statements, which come without a dollar layout and feature laudable goals -- increasing energy efficiency statewide by 15 percent in the next decade, advancing plans to link Alaskans with natural gas, and generating 50 percent of all electricity from renewable sources by 2025. Thanks largely to hydro projects in Southeast and, to a lesser degree, in Southcentral, the state's renewable energy use is already up to about 24 percent.

But the spending plans that accompany the omnibus bills -- especially a $293 million proposal from the Senate -- could be a little more contentious as lawmakers from each of the state's regions examine what's in it for their constituents.

The House and Senate proposals include similar items -- bills requiring energy efficiency in public buildings, greater investment in grants for renewable energy projects like wind-diesel systems in rural areas, and more money toward new technologies, like batteries that could store peak sun, wind and hydro power.

The Senate's spending plan includes more money beyond Gov. Sean Parnell's proposal for existing programs such as home weatherization, plus millions to launch a public education campaign stressing energy efficiency.

The House policy is the product of a 20-member stakeholder group that covered the spectrum -- industry and conservation groups, republicans and democrats. Chris Rose, executive director of Renewable Energy Alaska Project, participated.

"Policy is at the top of that hierarchy of projects, plans and programs, and informs the decisions you make about energy," Rose said.

Testifying before the Senate committee on Monday, Rose singled out Senate Bill 150, under which the state could award grants to groups developing new energy technologies. He said Alaska is one of the few places in the world where new technologies can be tested while providing a direct benefit to people, especially in rural areas.

"We really have the perfect laboratory to be testing these things," he said.

Alaska Conservation Alliance executive director Caitlin Higgins lauded the committee for including SB 121, which calls for greater energy efficiency in the roughly 2,000 buildings for which the state foots utilities bills.

Anchorage Republican Sen. Lesil McGuire, an architect of the Senate bill, said lawmakers at the helm of the Finance Committee will have to support the spending plan if it's to move.

Speaking to reporters on Tuesday morning, Finance co-chairmen Sens. Bert Stedman, R-Sitka, and Lyman Hoffman, D-Bethel, said they'll need to look in-depth at how the package helps each region of the state before giving it a stamp of approval. Hoffman said he doesn't anticipate much movement until mid-February, when a Senate-funded study on the costs of fuel is due out.

They also warned that with so many competing issues requiring money, the Finance Committee probably won't fund the entire $293 proposal, at least not in one year.

Not included in the bills is any mention of in-state natural gas. Sen. Bill Wielechowski, D-Anchorage and co-chairman of the Senate Resources Committee, said a bullet line from the North Slope should be considered if it offers low-cost gas, which is questionable at this point.

Instead, he suggested, Alaska could put renewables, including hydropower, to work creating energy for in-state use and eventually use its natural gas to generate money -- possibly by building a petrochemical industry or turning gas into liquid petroleum products.

Contact Rena Delbridge at rena(at)alaskadispatch.com.

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