Legislature(2009 - 2010)BUTROVICH 205
03/08/2010 03:30 PM Senate RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| SB220 | |
| SJR27 | |
| SB274 | |
| SB208 | |
| SB144 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 220 | TELECONFERENCED | |
| += | SJR 27 | TELECONFERENCED | |
| += | SB 274 | TELECONFERENCED | |
| += | SB 208 | TELECONFERENCED | |
| *+ | SB 144 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 220-ENERGY EFFICIENCY/ ALTERNATIVE ENERGY
3:40:22 PM
CO-CHAIR MCGUIRE announced SB 220 to be up for consideration
[CSSB 220(RES), labeled 26-LS1197\D, Kane was before the
committee].
MICHELLE SYDEMAN, staff to Senator Wielechowski, reviewed that
the committee first took up SB 220 almost six weeks ago. She
said they had taken invited testimony from energy experts, and
staff has worked closely with all the agencies; the bill has had
many hearings. As result there were numerous changes. Five of
those main changes are that they adopted an amendment by Senator
Huggins that allows nuclear power in Alaska and they added a
section suggested by Senator Hoffman that expands the state's
heating assistance program for low income families when oil
prices are high and the state has a surplus. They also
incorporated language from Senator Stedman's SB 132 which
expands the purposes of Southeast Energy Fund and adopted an
amendment offered by Senator Dyson requiring the Department of
Transportation and Public Facilities (DOTPF) to examine the
feasibility of powering vehicles in Alaska using compressed
natural gas. Finally, they added new language creating a new
loan fund for businesses seeking to make their facilities more
energy efficient or to incorporate renewable energy into their
operations. This idea was advanced by Senator Egan's office and
further developed by Senator McGuire's office. One additional
change was that they incorporated the Governor's SB 223 into
this bill and that authorizes AHFC to issue up to $250 million
in bonds to help the state, municipalities and school districts
to make their buildings more energy efficient. This revolving
loan fund should create an on-going revenue stream for the state
to help cities and schools cut their energy-related costs. She
said that they had a few more amendments and then the bill would
be ready for the committee's consideration.
3:43:23 PM
MIKE PAWLOWSKI, staff to Senator McGuire, said that several
small changes were made to version D after the amendments were
made to the previous version; some were clerical and some were
based on statements heard at the table. One example is on page
14, line 11, the Emerging Energy Technology Fund (EETF) section.
He explained that one of the discussions by Senator Wagoner was
that while having a degree in science or engineering is
appropriate, professional experience should be considered also.
Others were clerical cleanups, for example, saying the
department shall work with other state agencies in the
alternative energy section. Another change was on page 14, line
23. In the previous version they had the Alaska Energy Authority
on the board of the EETF, but since it is administering the fund
it didn't make sense for someone from it to also be on the
advisory committee. So they were replaced that position with the
Alaska Industrial Development and Export Authority (AIDEA).
Other changes were small and clerical.
3:45:07 PM
CO-CHAIR MCGUIRE moved Amendment 1, labeled 26-LS1197\D.1.
26-LS1197\D.1
Kane
AMENDMENT 1
OFFERED IN THE SENATE BY SENATOR MCGUIRE
TO: CSSB 220(RES), Draft Version "D"
Page 20, line 27:
Delete "Alaska"
Insert "alternative"
Page 28, line 1:
Delete "AS 44.42.067(c)"
Insert "AS 44.42.067(d)"
CO-CHAIR WIELECHOWSKI objected for discussion purposes.
CO-CHAIR MCGUIRE said this amendment references alternative
energy.
MR. PAWLOWSKI added that Amendment 1 took on the Department of
Commerce, Community and Economic Development (DCCED) business
loan program for energy efficiency and retitled it the Alaska
Energy Conservation Loan Fund. Since it was the Alternative
Energy Conservation Loan Fund, the reference in Section 27 had
to be changed to conform to the change language in an earlier
reference. So Amendment 1 is pure cleanup language.
The second change in Amendment 1 corrects the repeal of a wrong
subsection. It relates to new construction meeting energy
efficiency standards, but they wanted to repeal the reporting
requirements in AS 44.42.067(c) and (d). This can be found on
page 19, line 21.
CO-CHAIR WIELECHOWSKI removed his objection to Amendment 1.
CO-CHAIR MCGUIRE found no further objections and Amendment 1 was
adopted.
CO-CHAIR MCGUIRE moved Amendment 2.
26-LS1197\D.2
Kane
AMENDMENT 2
OFFERED IN THE SENATE BY SENATOR MCGUIRE
TO: CSSB 220(RES), Draft Version "D"
Page 13, line 16, following "projects;":
Insert "(2) amounts deposited under (f) of this
section;"
Renumber the following paragraph accordingly.
Page 13, line 22:
Delete "(f)"
Insert "(g)"
Page 14, line 1:
Delete "(f)"
Insert "(g)"
Page 14, line 8:
Delete "(f)"
Insert "(g)"
Page 14, following line 9:
Insert a new subsection to read:
"(f) As a condition of all grants awarded under
this section, the authority shall require that the
grantee pay to the authority a fair and reasonable
return to the fund, as determined by the authority,
from the revenue, economic value, or profits derived
by the grantee from the grant project. The authority
shall deposit the amounts received under this
subsection into the fund. To secure payment of sums
owed to the authority under a grant agreement, the
authority may own and take a security interest in
patents, copyrights, and other intellectual property."
Reletter the following bill subsections accordingly.
Page 14, line 24:
Delete "(f)"
Insert "(g)"
Page 14, lines 27 - 28:
Delete "(f)(4), (f)(5), or (f)(6)"
Insert "(g)(4), (g)(5), or (g)(6)"
Page 14, line 30:
Delete "(f)(4), (f)(5), or (f)(6)"
Insert "(g)(4), (g)(5), or (g)(6)"
CO-CHAIR WIELECHOWSKI objected for discussion purposes.
MR. PAWLOWSKI explained that Amendment 2 applies to Section 18
on page 13-15 of the bill, the Emerging Energy Technology Fund.
Lines 1-18 of the amendment are conforming languages. The
substance of the amendment was from line 18 through page 2, line
3. A question was raised in working with the department about
giving these grants to technology development and what happens
if this technology becomes wildly successful and a private
sector entrepreneur makes a lot of money out of it. This is old
language that existed in the Alaska Science and Technology Fund
where grants had conditions to provide a return to the state in
the event that a grant was successful. This language gives the
department some flexibility to put conditions on grants so that
they can function in a way that returns money to the fund for
future use and to endow future activities. They are still
working with the department to a degree on the language, but it
is very open and permissive.
CO-CHAIR MCGUIRE remarked that in Washington D.C. she was part
of a discussion that revealed the Department of Energy (DOE) has
an Emerging Technology Fund similar to this. They took a bet on
the technology that involves refracking that has led to the
shale extractions and as a result returns from that have set up
a pretty healthy loan fund for future technologies.
CO-CHAIR WIELECHOWSKI removed his objection to Amendment 2.
CO-CHAIR MCGUIRE found no further objections and therefore
Amendment 2 was adopted.
3:49:57 PM
CO-CHAIR MCGUIRE moved to adopt Amendment 3.
26-LS1197\D.3
Kane
AMENDMENT 3
OFFERED IN THE SENATE BY SENATOR MCGUIRE
TO: CSSB 220(RES), Draft Version "D"
Page 16, line 31, following "$30,000,000":
Insert "for each project"
Page 17, line 16:
Insert a new paragraph to read:
"(3) "project" means a plant, works,
system, or facility, together with related or
necessary facilities and appurtenances, including a
divided or undivided interest in or a right to the
capacity of a power project or project, that is used
or is useful for the purpose of renewable energy
production;"
Renumber the following paragraph accordingly.
Page 30, following line 12:
Insert a new bill section to read:
"* Sec. 51. The uncodified law of the State of
Alaska is amended by adding a new section to read:
EXHAUSTION OF UNUSED RENEWABLE ENERGY REFUNDABLE
TAX CREDITS. Notwithstanding the repeal of
AS 43.98.040 by sec. 43 of this Act, an unused portion
of a tax credit acquired under AS 43.98.040, enacted
by sec. 21 of this Act, may be carried forward until
exhausted, except that the unused portion of the tax
credit may not be carried forward to tax years
beginning after December 31, 2023."
Renumber the following bill section accordingly.
CO-CHAIR WIELECHOWSKI objected for discussion purposes.
MR. PAWLOWSKI explained that Amendment 3 came out of work with
the Department of Revenue (DOR). In the previous work on this
production tax credit there had been a degree of concern about
how big the liability to the state could be. That has been
approached in several different directions. It was based on the
15 percent of the electricity sold, but then also 10 percent of
the capital expenditures. A way was found to get at Senator
Stedman's concern about limiting a Susitna-style hydro project
that would cost in the range of $4.5 billion so the investor
wouldn't get a $450 million credit. They tried to design a cap
that mirrors what the equity would look like in a project of
that size and they came up with $30 million. So, the cap exists
in the current version at $30 million, but it was per person.
Working with staff and the DOR they really felt it should be per
project. So on page 1, lines 1-2, of the amendment "for each
project" was inserted. The amendment then inserts a definition
of project.
Another way they approached the issue of the liability to the
state is to provide a sunset in 2018 for the production tax
credits. But sunsetting it early required transition language
since tax credits are accrued over the first five years a
project produces energy. Section 51 on page 1, lines 15-23, of
the amendment are really about how to transition once the
renewable project comes on line just before the sunset period.
CO-CHAIR WIELECHOWSKI removed his objection.
CO-CHAIR MCGUIRE found no further objection, and, therefore,
Amendment 3 was adopted. She asked for further comments.
MR. PAWLOWSKI directed members to a summary sheet about fiscal
notes for the bill that they received yesterday afternoon.
CO-CHAIR MCGUIRE said most of the bill concerns incentives and
policy shifts that don't involve a lot of money. So the total
fiscal note is $1.281 million.
She noted that the committee heard support all across the board
from the communities, although one criticism she did hear three
times is that it doesn't deal solely with renewable energy, but
rather alternative energy and fossil fuel based energy in a
variety of places (the Bulk Fuel Loan and power cost
equalization (PCE). Nuclear has been added as an alternative
fuel source, so people refer to it as renewable, but the "real
nuclear guys" refer to it as alternative.
3:54:58 PM
SENATOR HUGGINS asked what kind of energy hydro is called in the
bill.
CO-CHAIR MCGUIRE said renewable. She said they had directed the
federal government to this definition in their resolutions as
recently as this week when she was in D.C. She thanked the
committee "for a labor of love," Michelle and Fish for all their
hours of work and dedication, and the administration for heeding
the call to assemble a team that has been working with them, as
well as the House of Representatives, Chair Edgmon and his
staff, so that the bills mirror one another.
SENATOR HUGGINS gave credit to her and Senator Wielechowski for
the broad travels of a group of people that really did some
yeoman work. It's important to realize that what they are doing
today had a thumbprint from people in communities across the
state.
CO-CHAIR WIELECHOWSKI commented that when they talked to Senator
Stevens about this bill last year he wondered if they would ever
get a product; and here it is. It is a product of one of the
more open and transparent processes he has seen in this
legislature. He thanked staff, staff in other offices and the
administration. He thought the state would get tremendous bang
for its buck out of this bill.
3:59:05 PM
CO-CHAIR WIELECHOWSKI moved to report CSSB 220(RES) as amended
from committee with individual recommendations and attached
fiscal note(s). There were no objections and it was so ordered.
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