Legislature(2009 - 2010)BARNES 124

01/28/2010 03:00 PM ENERGY


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03:07:07 PM Start
03:07:24 PM Presentation by Robert Pickett, Chairman of the Regulatory Commission of Alaska: Net Metering Regulations Review and Proposed Cook Inlet Natural Gas Storage Project Update
04:20:58 PM HB306
05:06:19 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Presentation by Bob Pickett, Chairman of TELECONFERENCED
the Regulatory Commission of Alaska:
Net Metering Regulations review and
Proposed Cook Inlet natural gas storage
project update
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 306 STATE ENERGY POLICY TELECONFERENCED
Heard & Held
-- Public Testimony --
                   HB 306-STATE ENERGY POLICY                                                                               
                                                                                                                                
CO-CHAIR EDGMON announced that the  final order of business would                                                               
be  to hear  public  testimony on  HOUSE BILL  NO.  306, "An  Act                                                               
declaring a state energy policy."                                                                                               
                                                                                                                                
4:20:58 PM                                                                                                                    
                                                                                                                                
ROBERT  VENABLES,   Energy  Coordinator,   Southeast  Conference,                                                               
informed the  committee that Southeast  Conference is  a regional                                                               
development   organization.     Its  mission   is  to   encourage                                                               
activities  and promote  strong  economies, healthy  communities,                                                               
and  a quality  environment in  Southeast Alaska.   Mr.  Venables                                                               
shared that,  for the  last 12 years,  his organization  has been                                                               
working to  develop the  energy policies  and projects  that will                                                               
lead to  the displacement of diesel  as the primary fuel  for the                                                               
generation of  electricity in Southeast  communities.   He stated                                                               
that  Southeast Conference  supports HB  306;  in fact  it was  a                                                               
member of the  stakeholders group during the interim.   He opined                                                               
HB 306  leads the  way for state  investment in  energy projects,                                                               
economic  development, and  renewable  energy  projects in  rural                                                               
areas.    Mr.  Venables  stated   his  organization's  intent  to                                                               
participate with  the state  in on-going  projects, both  for the                                                               
generation and the transmission of  energy, and he cited the need                                                               
for a higher  level of planning to  direct Southeast investments.                                                               
He offered to lend Southeast  Conference members and utilities in                                                               
support of the bill.                                                                                                            
                                                                                                                                
4:23:30 PM                                                                                                                    
                                                                                                                                
CO-CHAIR   EDGMON   thanked    Southeast   Conference   for   its                                                               
contributions to the plan.                                                                                                      
                                                                                                                                
4:24:53 PM                                                                                                                    
                                                                                                                                
JERRY  MCCUTCHEON informed  the committee  he would  send written                                                               
comments to  the legislature.   He  opined that  HB 306  was "not                                                               
much"  and did  not do  anything.   The state  must address  that                                                               
which is doable,  and not get tied up in  illusions about what is                                                               
not doable;  for example, pursuing a  gas line when the  Lower 48                                                               
and western Canada  is awash in gas.  He  relayed a short history                                                               
of the gas line project.                                                                                                        
                                                                                                                                
4:27:04 PM                                                                                                                    
                                                                                                                                
DAVID LEVY  stated that the Alaska  Mobility Coalition represents                                                               
and advocates for public  and community transportation statewide.                                                               
It has 76 members from Bethel  to Prince of Wales Island, and its                                                               
members  represent public  and  community transportation  systems                                                               
that provide  over 7,000,000  rides annually.   Mr.  Levy thanked                                                               
the  committee for  its work  and pointed  out that  the role  of                                                               
public  transportation, and  the energy  savings and  support for                                                               
employment  it  provides,  should   be  part  of  the  discussion                                                               
regarding energy.  He informed  the committee that the senate has                                                               
included  public transportation  in its  bill, and  he encouraged                                                               
the House  Special Committee on  Energy to  do so.   He expressed                                                               
support for  the amendment offered by  Representative Petersen to                                                               
include public transportation as part of the overall dialog.                                                                    
                                                                                                                                
4:29:26 PM                                                                                                                    
                                                                                                                                
CHRIS ROSE,  Executive Director, Renewable Energy  Alaska Project                                                               
(REAP),  said that  he participated  with the  stakeholders group                                                               
that worked on  the proposed legislation.  Today,  however, he is                                                               
representing REAP in support of the  bill.  A state energy policy                                                               
is necessary  to set the broad  framework on how the  state makes                                                               
its  energy  decisions.   Although  there  are plenty  of  energy                                                               
programs and projects  in place around the state,  there needs to                                                               
be a  policy to provide a  framework and a long-term  vision.  He                                                               
opined the  language of the  bill looks  at the influence  on the                                                               
state  from around  the world,  such as  the increasing  price of                                                               
fossil fuels, and  the growth of the clean energy  industry.  Mr.                                                               
Rose stressed that the emphasis  on energy efficiency in the bill                                                               
is very  important and  makes economic  sense.   His organization                                                               
also supports the  emphasis on renewable energy.   Upon review of                                                               
the bill by the REAP  policy committee, the policy committee felt                                                               
that REAP  should be  neutral on  parts of the  bill that  do not                                                               
support  its  mission-  increasing the  production  of  renewable                                                               
energy and  promoting energy efficiency-but  other parts  such as                                                               
workforce development, education  campaigns, and the streamlining                                                               
of governmental functions, pertain to REAP's mission statement.                                                                 
                                                                                                                                
4:33:08 PM                                                                                                                    
                                                                                                                                
BILL  POPP, President  and  CEO,  Anchorage Economic  Development                                                               
Corporation  (AEDC),   said  that   he  was   a  member   of  the                                                               
stakeholders group  and thanked all  of those who  contributed to                                                               
the formation  of the bill.   He agreed with Mr.  Rose, and added                                                               
that it is vital for the  state to bring forward an energy policy                                                               
that addresses  the basis on energy  for the state in  the coming                                                               
decade.   Without  such a  policy, the  state will  "clunk along"                                                               
with some successful individual projects  that may not be in line                                                               
with  a broader  vision and  a set  of goals.   He  expressed his                                                               
concern that without a basis  for the process, decisions are made                                                               
about the  allocation of resources  that may not fit  the state's                                                               
longer  term   goals,  whether  for  renewable   or  nonrenewable                                                               
projects.  In  the past, Alaska has faced  challenges in choosing                                                               
projects  that should  go forward,  and others  that should  not.                                                               
Mr.  Popp  opined  that this  policy  recognizes  that,  although                                                               
renewable  energy  is a  part  of  our  future  and will  make  a                                                               
difference especially in rural areas,  the state economy is based                                                               
on  non-renewable  resource  extraction  and  will  be  for  many                                                               
decades.  He strongly urged the passage of HB 306.                                                                              
                                                                                                                                
4:36:15 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK   asked  whether   Mr.  Popp   supports  the                                                               
workforce development portion of the bill.                                                                                      
                                                                                                                                
4:36:31 PM                                                                                                                    
                                                                                                                                
MR. POPP confirmed that a  strong vital workforce is necessary to                                                               
support  the  building,  operation,  and  maintenance  of  energy                                                               
infrastructure of all types.   In addition, a good, well-thought-                                                               
out  investment in  energy infrastructure  workforce training  is                                                               
very  important and  the policy  is a  first step  toward gaining                                                               
that investment.                                                                                                                
                                                                                                                                
4:36:57 PM                                                                                                                    
                                                                                                                                
CAITLIN   HIGGINS,   Executive  Director,   Alaska   Conservation                                                               
Alliance, stated  that the Alaska  Conservation Alliance  and its                                                               
40 member organizations, representing  38,000 Alaskans, wishes to                                                               
applaud the committee  on its strong leadership and  hard work on                                                               
these issues.   The committee's commitment to the  creation of an                                                               
overarching  policy   to  guide   related  energy   decisions  is                                                               
encouraging.  As  a member of the stakeholder  group, Ms. Higgins                                                               
thanked the co-chairs  for the opportunity to  participate in the                                                               
process,  and the  other members  for their  contributions.   The                                                               
proposed legislation  will put Alaska  on an  economically stable                                                               
and  sustainable path  to the  future  that is  supported by  the                                                               
conservation  community.    The alliance  strongly  supports  the                                                               
provisions in  the bill  that focus  on energy  efficiency first,                                                               
and  it   encourages  the   establishment  of   statewide  energy                                                               
efficiency  codes,  decreased  energy  use  in  public  buildings                                                               
through efficiency,  and the  education of  the public  on energy                                                               
efficiency.    In  fact,  this  support is  so  strong  that  the                                                               
alliance commissioned  a report that  shows how the  Railbelt can                                                               
reach  a  goal  for  energy  efficiency-perhaps  as  high  as  50                                                               
percent-by 2025.   The Railbelt Electricity  Efficiency Landscape                                                               
(REEL In  Alaska roadmap)  results will be  issued soon  and will                                                               
support efforts  to set aggressive  energy efficiency  goals that                                                               
encourage the  state and its  citizens, businesses,  and industry                                                               
to strive  to be as  energy efficient  as possible.   Ms. Higgins                                                               
recalled  that  everyone  in  the   stakeholders  group  and  the                                                               
committee  share  an  interest  in  promoting  and  incentivizing                                                               
energy efficiency  so that  Alaska can  benefit from  this clean,                                                               
cheap, and  simple way to  meet its  energy needs.   Although the                                                               
alliance supports  the inclusion  of goals for  energy efficiency                                                               
in  the proposed  policy, it  encouraged the  committee to  place                                                               
these  goals in  codified language.   She  opined placing  all of                                                               
these  goals in  codified  statute will  increase the  likelihood                                                               
that  the goals  will be  met.   The alliance  also supports  the                                                               
inclusion    of   provisions    encouraging   renewable    energy                                                               
development, because such development  will help the state secure                                                               
its energy future.  Lastly,  the alliance supports the provisions                                                               
encouraging training  and research, emerging  technology research                                                               
and  development  in  the  field of  renewable  energy,  and  the                                                               
coordination of state  entities focused on energy.   On behalf of                                                               
the Alaska  Conservation Alliance, she encouraged  the passage of                                                               
HB 306 during 2010.                                                                                                             
                                                                                                                                
4:42:40 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHANSEN observed  that  the Alaska  Conservation                                                               
Alliance has a  membership of 40 groups.  He  asked which members                                                               
were based in Southeast.                                                                                                        
                                                                                                                                
4:43:14 PM                                                                                                                    
                                                                                                                                
MS.   HIGGINS  said   those  groups   would  include   the  Sitka                                                               
Conservation  Society,  Lynn  Canal Conservation,  the  Southeast                                                               
Alaska  Conservation Council  (SEACC),  and others.   In  further                                                               
response  to  Representative  Johansen,   she  said  the  Tongass                                                               
Conservation Society is no longer a member.                                                                                     
                                                                                                                                
4:43:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN  agreed with  Ms. Higgins' support  of HB
306.   He advised that  to achieve  goals that the  alliance, and                                                               
he, support such  as the 50 percent [of  electric generation from                                                               
renewable energy sources by 2025], choices  have to be made.  For                                                               
example,  during construction  of the  intertie between  Wrangell                                                               
and Ketchikan,  the price was  accelerated by  litigation brought                                                               
by groups like SEACC.  He remarked:                                                                                             
                                                                                                                                
     I'm hoping that your  organizations, at some point, are                                                                    
     going  to  make  a  choice  between  litigating  access                                                                    
     corridors,  because you  have to  cut down  a renewable                                                                    
     tree, versus cheap  and affordable energy.   And I hope                                                                    
     that conversation  is going on  within your  groups ...                                                                    
     But it's a  real challenge to transmission,  and I hope                                                                    
     we all  understand that that's  going to be  a question                                                                    
     that's going to  come up.  At what point  do you make a                                                                    
     choice between cheap and  renewable energy and allowing                                                                    
     the corridors to go through?                                                                                               
                                                                                                                                
4:45:30 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON closed public testimony.                                                                                        
                                                                                                                                
4:46:35 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK moved to adopt Amendment 3 to HB 306.                                                                       
                                                                                                                                
CO-CHAIR EDGMON objected for the purpose of discussion.                                                                         
                                                                                                                                
4:47:09 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  stated that the  intent of the  amendment is                                                               
to  ensure  that  workforce  development  is  a  priority.    The                                                               
amendment read:                                                                                                                 
                                                                                                                                
     Page 3, line 2, following "programs":                                                                                      
                                                                                                                                
          Insert   "that   will   help   create   jobs   for                                                                    
          Alaskans and"                                                                                                         
                                                                                                                                
                                                                                                                                
4:47:45 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  EDGMON  removed  his  objection.   Hearing  no  further                                                               
objection, Amendment 3 was adopted.                                                                                             
                                                                                                                                
4:48:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PETERSEN moved Amendment 1.                                                                                      
                                                                                                                                
4:48:17 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON objected for purposes of discussion.                                                                            
                                                                                                                                
4:48:23 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   PETERSEN  informed   the  committee   that  this                                                               
amendment adds a new subparagraph which read:                                                                                   
                                                                                                                                
     Page 2, following line 18:                                                                                                 
          Insert a new subparagraph to read:                                                                                    
                                     "(D) encouraging                                                                           
               the use of public                                                                                                
          transportation and                                                                                                    
          assisting communities in                                                                                              
          developing public transportation                                                                                      
          options in an effort to decrease                                                                                      
          fuel usage by motor vehicles."                                                                                        
                                                                                                                                
REPRESENTATIVE  PETERSEN added  that  this  amendment would  also                                                               
reduce wear and tear on highways.                                                                                               
                                                                                                                                
4:49:01 PM                                                                                                                    
                                                                                                                                
CO-CHAIR   MILLETT   recalled    previous   discussion   in   the                                                               
stakeholders  group   on  this  issue.     Because  the  proposed                                                               
legislation  is statewide  policy, participants  did not  feel it                                                               
was  appropriate  as public  transportation  is  not relevant  to                                                               
rural communities.  She expressed her opposition to Amendment 1.                                                                
                                                                                                                                
4:50:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DAHLSTROM surmised  that "assisting  communities"                                                               
would obligate the state to fund assistance.                                                                                    
                                                                                                                                
4:5:25 PM                                                                                                                     
                                                                                                                                
REPRESENTATIVE  PETERSEN  relayed  that in  other  states  public                                                               
transportation usually  needs a public  subsidy until it  turns a                                                               
profit; for  example, in  New Mexico the  state built  a commuter                                                               
rail.  Public transportation has  also been successful in Seattle                                                               
and  Portland.   He pointed  out that  the proposed  policy is  a                                                               
long-term view  of the future  and a comprehensive-type  of bill,                                                               
and encouraged the inclusion of the amendment.                                                                                  
                                                                                                                                
4:52:05 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   DAHLSTROM  stated   that  because   HB  306   is                                                               
comprehensive  and  statewide, she  was  reluctant  to "give  the                                                               
perception  that  we  are interested  in  developing  ...  public                                                               
transportation  statewide."    She expressed  her  opposition  to                                                               
Amendment 1.                                                                                                                    
                                                                                                                                
4:52:52 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PETERSEN commented that  the Alaska Marine Highway                                                               
System (AMHS)  is subsidized by  the state budget every  year and                                                               
is a form of public transportation.                                                                                             
                                                                                                                                
4:53:09 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN  pointed out  that the  AMHS is  the only                                                               
transportation system with  a fare box; on the  other hand, every                                                               
road in Alaska is completely subsidized.                                                                                        
                                                                                                                                
4:53:39 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  RAMRAS   recalled  remarks  he  heard   by  rural                                                               
legislators  about  inequities and  the  lack  of parity  in  the                                                               
governor's proposed  scholarship program;  in truth, the  lack of                                                               
parity  between rural  and  urban  regions of  the  state can  be                                                               
offensive.  He said:                                                                                                            
                                                                                                                                
     I  think [the  amendment's] inclusion,  frankly even  a                                                                    
     vote on  amendment 1,  incurs the  same offense  by not                                                                    
     recognizing  some of  the limitations  that we  have in                                                                    
     rural Alaska.                                                                                                              
                                                                                                                                
4:55:11 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON  stated his  understanding from  the stakeholders                                                               
group  discussions that  the policy  must be  general, statewide,                                                               
and uniform in  application.  He suggested that  the amendment is                                                               
more  appropriate  to  a  plan  of  action  rather  than  to  the                                                               
overarching policy.                                                                                                             
                                                                                                                                
4:56:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK agreed that  mass transportation can conserve                                                               
energy, as  the policy seeks  to do; however, the  committee does                                                               
not  want  to  isolate  rural Alaskans,  but  to  provide  energy                                                               
opportunities  for  them  as  well,    and  he  agreed  that  the                                                               
amendment would benefit urban areas.                                                                                            
                                                                                                                                
4:57:44 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PETERSEN withdrew amendment 1.                                                                                   
                                                                                                                                
4:58:12 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PETERSEN moved Amendment 2 which read:                                                                           
                                                                                                                                
     Page 1, line 13, following "projects":                                                                                     
               Insert ";                                                                                                        
                (5) the state remain a leader in                                                                                
       petroleum and natural gas production and become a                                                                        
     leader in renewable energy development;                                                                                    
               (6) consumer fuel and electricity                                                                                
      prices in the state be comparable to those prices in                                                                      
     other leading energy producing regions"                                                                                    
                                                                                                                                
CO-CHAIR EDGMON objected for purposes of discussion.                                                                            
                                                                                                                                
4:58:57 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RAMRAS offered an  amendment to Amendment 2, which                                                               
was the deletion of lines 5 and 6.                                                                                              
                                                                                                                                
4:59:21 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON confirmed that the  amendment removed item (6) of                                                               
Amendment 2.                                                                                                                    
                                                                                                                                
4:59:53 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT supported lines 3 and 4 of Amendment 2.                                                                        
                                                                                                                                
5:00:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN  objected to  the amendment  to Amendment                                                               
2, and stated his support of the amendment to Amendment 2.                                                                      
                                                                                                                                
5:00:34 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK explained that the  purpose of item (6) is to                                                               
ensure that  the state,  with renewable  projects, is  not "going                                                               
backwards  in energy  savings  and cost  due  the ratepayers,  in                                                               
exchange of  trying to hit  some of our  targets."  As  the state                                                               
moves to  reach its renewable goals,  it must not be  at the cost                                                               
of ratepayers along the way.                                                                                                    
                                                                                                                                
5:01:17 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON  re-stated the efforts of  the stakeholders group                                                               
to not incorporate  statements of subjectivity.   He opined lines                                                               
5 and 6 of Amendment 2  have an element of interpretation that is                                                               
not  in  alignment  with  the  spirit of  the  legislation.    He                                                               
indicated his support for the amendment to Amendment 2.                                                                         
                                                                                                                                
5:02:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN  removed his  objection to  the amendment                                                               
to Amendment 2.                                                                                                                 
                                                                                                                                
5:02:19 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON  announced that the  amendment to Amendment  2 is                                                               
adopted.                                                                                                                        
                                                                                                                                
5:02:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RAMRAS  concluded that  the maker of  Amendment 2,                                                               
as amended, has captured the intent of much of HB 306.                                                                          
                                                                                                                                
5:03:38 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  EDGMON  removed  his  objection.   Hearing  no  further                                                               
objection, Amendment 2, as amended, was adopted.                                                                                
                                                                                                                                
5:04:16 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT moved Amendment 4.                                                                                             
                                                                                                                                
5:04:21 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON objected for purposes of discussion.                                                                            
                                                                                                                                
5:04:22 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT  explained Amendment 4 is  a technical amendment                                                               
to   page   3,  line   10,   deleting   "review"  and   inserting                                                               
"regulation".                                                                                                                   
                                                                                                                                
5:04:48 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON removed his objection.  Hearing no further                                                                      
objection, Amendment 4 was adopted.                                                                                             
                                                                                                                                
5:05:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN said he is working on an amendment.                                                                     
                                                                                                                                
5:05:45 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON announced HB 306 was held in committee.                                                                         

Document Name Date/Time Subjects
HB 306 Sponsor Statement.pdf HENE 1/26/2010 3:00:00 PM
HENE 1/28/2010 3:00:00 PM
HB 306
Energy Policy for Alaska Presentation 01 26 10.pdf HENE 1/26/2010 3:00:00 PM
HENE 1/28/2010 3:00:00 PM
HB 306
Energy Committee Agenda 01282010.pdf HENE 1/28/2010 3:00:00 PM
House Special Energy_01_28_10 RCA.pdf HENE 1/28/2010 3:00:00 PM
Amendments for HB306.pdf HENE 1/28/2010 3:00:00 PM
HB 306
Am #3 - HB306.pdf HENE 1/28/2010 3:00:00 PM
HB 306