Legislature(2009 - 2010)

04/16/2010 10:47 AM FIN


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CS FOR SENATE BILL NO. 220(FIN)                                                                                               
                                                                                                                                
     "An   Act  relating   to   energy  efficiency,   energy                                                                    
     conservation,  and alternative  energy, to  an emerging                                                                    
     energy technology fund,  to the lease of  state land to                                                                    
     a  public  electric  utility,  to  the  Alaska  heating                                                                    
     assistance program,  to state  energy use data,  to the                                                                    
     Southeast  energy fund,  to  nuclear energy  production                                                                    
     and facilities,  to the  definition of  'power project'                                                                    
     or  'project'  as it  relates  to  rural and  statewide                                                                    
     energy programs  and the  Alaska Energy  Authority, and                                                                    
     to  the  definition  of  'alternative  energy  system';                                                                    
     establishing  an  Alaska  energy  efficiency  revolving                                                                    
     loan fund;  directing the Department  of Transportation                                                                    
     and  Public  Facilities  to prepare  a  report  on  the                                                                    
     feasibility of  using compressed  natural gas  to power                                                                    
     vehicles  in the  state,  including  vehicles owned  or                                                                    
     operated by the state, and  including in that study, if                                                                    
     warranted, a  pilot program proposal for  powering some                                                                    
     vehicles   owned  or   operated  by   the  state   with                                                                    
     compressed  natural gas;  authorizing  and relating  to                                                                    
     the  issuance of  bonds by  the Alaska  Housing Finance                                                                    
     Corporation;   relating  to   a   report  regarding   a                                                                    
     municipal energy improvements  financing program and to                                                                    
     an energy  report by  the Office  of the  Governor; and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
8:08:49 PM                                                                                                                    
                                                                                                                                
                                                                                                                                
MIKE POWLOWSKI, STAFF, SENATOR LESIL MCGUIRE, introduced                                                                        
himself for the record.                                                                                                         
                                                                                                                                
8:09:58 PM     AT EASE                                                                                                        
8:11:15 PM     RECONVIENE                                                                                                     
                                                                                                                                
Co-Chair Stoltze solicited discussion of the proposed                                                                           
amendments.                                                                                                                     
                                                                                                                                
SENATOR BILL WEILECHOWSKI, SPONSOR, communicated that he                                                                        
had no objection to the proposed amendments.                                                                                    
                                                                                                                                
SENATOR  LESIL MCGUIRE  noted no  objection to  the proposed                                                                    
amendments.                                                                                                                     
                                                                                                                                
Vice-Chair  Thomas MOVED  Amendment 1,  26-LS1197\Y.6, Kane,                                                                    
4/13/10:                                                                                                                        
                                                                                                                                
     Page 11, line 11:                                                                                                          
          Delete "or"                                                                                                           
          Insert "and 42.45.310,"                                                                                               
                                                                                                                                
     Page 11, line 12, following "AS 10.25":                                                                                    
          Insert "or another electric utility holding                                                                           
          certificate of public convenience and necessity                                                                       
          under AS 42.05"                                                                                                       
                                                                                                                                
Co-Chair Stoltze OBJECTED for the purpose of discussion.                                                                        
                                                                                                                                
Mr. Powlowski stated that the  amendment 1 made an important                                                                    
change  to  the  recipients  who were  eligible  to  receive                                                                    
grants  from the  southeast energy  fund that  had been  re-                                                                    
enacted  and modified  within SB  220.  The amendment  added                                                                    
electric   utilities  holding   a   certificate  of   public                                                                    
convenience  or  necessity, to  the  list  of entities  that                                                                    
could receive grants under the legislation.                                                                                     
                                                                                                                                
Co-Chair  Stoltze WITHDREW  his  OBJECTION  to Amendment  1.                                                                    
There being no further OBJECTION, Amendment 1 was ADOPTED.                                                                      
                                                                                                                                
Representative  Kelly  Moved   Amendment  2,  26-LS1197\Y.7,                                                                    
Kane, 4/15/10:                                                                                                                  
                                                                                                                                
     Page 18, lines 15-16:                                                                                                      
          Delete "with a catalytic converter or a catalytic                                                                     
          converter for a wood stove"                                                                                           
          Insert "that complies with the provision of 40                                                                        
          C.F.R. 60.530 [WITH A CATLYTIC CONVERTER OR A                                                                         
          CATALYTIC CONVERTER FOR A WOOD STOVE}"                                                                                
                                                                                                                                
     Page 18, line 21:                                                                                                          
          Delete "wood, coal,"                                                                                                  
          Insert "coal [WOOD,COAL,]"                                                                                        
                                                                                                                                
Co-Chair Stoltze OBJECTED for the purpose of discussion.                                                                        
                                                                                                                                
Mr. Powlowski explained  that a simple wood  or pellet grain                                                                    
stove would  not work appropriately  under 40  C.F.R 60.530,                                                                    
which established the admissions criteria determined by the                                                                     
Environmental Protection Agency (EPA).                                                                                          
                                                                                                                                
Co-Chair Stoltze WITHDREW his OBJECTION to Amendment                                                                            
2.There being no further OBJECTION, Amendment 2 was                                                                             
ADOPTED.                                                                                                                        
                                                                                                                                
Representative Gara WITHDREW Amendment 3.                                                                                       
                                                                                                                                
8:17:41 PM                                                                                                                    
                                                                                                                                
Representative Gara MOVED Amendment 4, 26-LS1197\Y.4, Kane,                                                                     
4/14/10:                                                                                                                        
                                                                                                                                
     Page 15, following line 24:                                                                                                
     Insert a new bill section to read:                                                                                         
                                                                                                                              
 "* Sec. 17. AS 44.42 is amended by adding a new section to                                                                 
read:                                                                                                                           
          Sec. 44.42.067. Retrofits and new construction                                                                      
     for  energy efficiency;  energy efficiency  report. (a)                                                                  
     Not later  than January 1,  2020, the  department shall                                                                    
     work with other state agencies  to retrofit at least 25                                                                    
     percent of  all public facilities, starting  with those                                                                    
     it determines  are the least  energy efficient,  if the                                                                    
     department  determines  that  retrofitting  the  public                                                                    
     facilities  will  result in  a  net  savings in  energy                                                                    
     costs to the state within  15 years after completion of                                                                    
     the retrofits for a public  facility and if funding for                                                                    
     the retrofits is available.                                                                                                
          (b)  A retrofit or deferred maintenance of a                                                                          
     public facility  performed under  this section,  to the                                                                    
     extent  feasible,   shall  meet  or  exceed   the  most                                                                    
     recently   published   edition  of   the   ASHRAE/IESNA                                                                    
     Standard  90.1, Energy  Standard  for Buildings  Except                                                                    
     for  Low-Rise Residential  Buildings,  as published  by                                                                    
     the  American  Society  of Heating,  Refrigerating  and                                                                    
     Air-Conditioning Engineers.                                                                                                
          (c)  New construction of a public facility under                                                                      
     this  section shall  meet or  exceed the  most recently                                                                    
     published  edition of  the ASHRAE/IESNA  Standard 90.1,                                                                    
     Energy  Standard  for  Buildings  Except  for  Low-Rise                                                                    
     Residential  Buildings, as  published  by the  American                                                                    
     Society of Heating,  Refrigerating and Air-Conditioning                                                                    
     Engineers.                                                                                                                 
          (d)  Not later than January 1 of each year, the                                                                       
     department,  in  consultation  with the  Department  of                                                                    
     Administration,   shall   submit   a  report   to   the                                                                    
     legislature  detailing  the  department's  progress  in                                                                    
     meeting  the requirements  of  this  section to  reduce                                                                    
     state  energy consumption  and costs  and carrying  out                                                                    
     the  duties listed  in AS 44.42.020  as they  relate to                                                                    
     energy use. The department  shall include in the report                                                                    
     an  analysis  of  the   consumption  and  expense  data                                                                    
     recorded by  the office of management  and budget under                                                                    
     AS 37.07.040,  comparing energy  consumption levels  in                                                                    
     each year  with past  years to determine  if reductions                                                                    
     are being achieved.                                                                                                        
          (e)  In this section, "public facility" means a                                                                       
     facility  owned   and  controlled  by  the   state  for                                                                    
     government or public use that  is 10,000 square feet or                                                                    
     more  and  is  not  a  legislative  building  or  court                                                                    
     building."                                                                                                                 
                                                                                                                                
Renumber the following bill sections accordingly.                                                                               
                                                                                                                                
Page 26, line 18:                                                                                                               
     Delete "secs. 27 - 34"                                                                                                     
     Insert "secs. 28 - 35"                                                                                                     
                                                                                                                                
Page 26, line 20:                                                                                                               
     Delete "secs. 27 - 34"                                                                                                     
     Insert "secs. 28 - 35"                                                                                                     
                                                                                                                                
Page 26, line 21:                                                                                                               
     Delete "secs. 27 - 34"                                                                                                     
     Insert "secs. 28 - 35"                                                                                                     
                                                                                                                                
Page 27, line 1:                                                                                                                
     Delete "secs. 27 - 34"                                                                                                     
     Insert "secs. 28 - 35"-                                                                                                    
                                                                                                                                
Page 27, following line 1:                                                                                                      
     Insert a new bill section to read:                                                                                         
   "* Sec. 45. The uncodified law of the State of Alaska is                                                                 
amended by adding a new section to read:                                                                                        
                                                                                                                                
     DEPARTMENT  OF  TRANSPORTATION AND  PUBLIC  FACILITIES.                                                                    
Not later  than one  year after the  effective date  of this                                                                    
section,  the   Department  of  Transportation   and  Public                                                                    
Facilities,   in  consultation   with   the  Alaska   Energy                                                                    
Authority, shall  adopt and  implement a  systematic process                                                                    
for prioritizing the retrofitting  of state facilities for a                                                                    
long-term  increase in  energy efficiency  and reduction  of                                                                    
energy costs."                                                                                                                  
                                                                                                                                
Renumber the following bill sections accordingly.                                                                               
                                                                                                                                
Page 27, line 9:                                                                                                                
     Delete "Section 42(b)"                                                                                                     
     Insert "Section 43(b)"                                                                                                     
                                                                                                                                
Co-Chair Stoltze OBJECTED for the purpose of discussion.                                                                        
                                                                                                                                
Representative  Gara  explained  that  the  amendment  would                                                                    
require  major retrofits  and  new  construction to  certain                                                                    
state  buildings   in  order   to  meet   energy  efficiency                                                                    
standards.  He  added that  not  only  would the  efficiency                                                                    
standards be met,  but the cost of bringing  the DOT managed                                                                    
buildings  up  to standard  would  be  reimbursed within  15                                                                    
years.                                                                                                                          
                                                                                                                                
Representative Fairclough asked what  the life expectancy of                                                                    
a boiler  system was, and  the cost of  maintenance relative                                                                    
to the life expectancy. She  expressed concern that 15 years                                                                    
may not allow for reimbursement of all expected upgrades.                                                                       
                                                                                                                                
Co-Chair  Hawker   articulated  his  unease  was   that  the                                                                    
amendment would  codify the most recently  published edition                                                                    
of the  American Society of  Heating, Refrigerating  and Air                                                                    
Conditioning  Engineers/Illuminating Engineering  Society of                                                                    
North America  (ASHRAE/IESNA) Standard 90.1  Energy Standard                                                                    
for Buildings Except for  Low-Rise Residential Buildings, as                                                                    
Published by the American  Society of Heating, Refrigerating                                                                    
and  Air  Conditioning  Engineers.   He  believed  that  the                                                                    
amendment should be scrutinized  by an energy committee that                                                                    
was more  familiar with  terms of  art pertaining  to energy                                                                    
issues and codes.                                                                                                               
                                                                                                                                
Representative Fairclough  agreed that the  amendment needed                                                                    
more work in order to be codified into state statute.                                                                           
                                                                                                                                
8:21:51 PM                                                                                                                    
                                                                                                                                
Senator Weilechowski  stated that the ASHRAE  standards were                                                                    
currently   being   adhered   to  by   the   Department   of                                                                    
Transportation   and   that   monetary   saving   had   been                                                                    
experienced by  DOT in the  retrofitting of  buildings using                                                                    
language  similar  to  that  found  in  the  amendment.  The                                                                    
sponsors  had worked  closely with  the department  to craft                                                                    
the amendment  language. He said  that 8 buildings  had been                                                                    
retrofitted so far, with an  average savings of $570,000 per                                                                    
year. The  estimated savings under  the provision  was $2.75                                                                    
million per year.                                                                                                               
                                                                                                                                
Senator  McGuire stated  that  she wanted  to  see the  bill                                                                    
passed  adding  that,  "the  possible  is  better  than  the                                                                    
perfect".  She furthered  that the  code  was already  being                                                                    
applied by the department.                                                                                                      
                                                                                                                                
8:23:57 PM                                                                                                                    
                                                                                                                                
MARY   SIROKY,  SPECIAL   ASSISTANT  TO   THE  COMMISSIONER,                                                                    
DEPARTMENT OF  TRANSPORTATION AND PUBLIC  FACILITIES, stated                                                                    
that  the ASHRAE  standard  was used  as  the baseline  upon                                                                    
which  the  architectural   engineering  community  designed                                                                    
facilities  in  Alaska.  The   code  focused  on  commercial                                                                    
buildings,  and  was  the national  standard  used  by  many                                                                    
states.   She understood that  the code was being  used, and                                                                    
would  continue  to be  used,  despite  the passage  of  the                                                                    
amendment.                                                                                                                      
                                                                                                                                
Co-Chair Hawker  clarified that the standard  was being used                                                                    
without being  codified and  made a mandate,  it was  used a                                                                    
matter of policy  and practice. Ms. Siroky  replied yes. Co-                                                                    
Chair  Hawker asked  if  DOT was  currently  engaged in  the                                                                    
retrofitting   of  25   different   buildings.  Ms.   Siroky                                                                    
responded that  the department  had not  received additional                                                                    
funding for  the retrofits needed  on all 25  buildings. She                                                                    
shared that  the department had  written a fiscal  note that                                                                    
would  add  an  additional  body to  oversee  the  necessary                                                                    
retrofits. She  stated that four  facilities per  year would                                                                    
be necessary  to meet the  mandate of completing  25 percent                                                                    
by  2020. Co-Chair  Hawker reiterated  his  unease with  the                                                                    
codification and mandating of the language as statute.                                                                          
                                                                                                                                
8:26:44 PM                                                                                                                    
                                                                                                                                
Representative Gara  emphasized that  the amendment  was the                                                                    
result of  2 years of  work by the Senate  Energy Committee,                                                                    
which  had worked  with the  department and  the engineering                                                                    
community. He  stated that the  amendment did not  limit the                                                                    
amount of reimbursement to the  state. The legislation asked                                                                    
the department to focus on  the projects that would create a                                                                    
rapid  return. The  department supported  the amendment  and                                                                    
the  energy committee  had  vetted it  and  worked to  craft                                                                    
language that was adoptable as a standard.                                                                                      
                                                                                                                                
Representative Fairclough  asked if  the provision  had been                                                                    
included in the legislation when  it was passed on the floor                                                                    
of the other body.                                                                                                              
                                                                                                                                
Representative  Gara  stated that  it  was  inserted by  the                                                                    
Senate  Energy Committee  after spending  2 years  traveling                                                                    
the state and gathering research.  The members of the Senate                                                                    
Finance Committee  had voiced no  objection to  the addition                                                                    
of the amendment to the legislation.                                                                                            
                                                                                                                                
Co-Chair  Stoltze  asked if  a  similar  amendment had  been                                                                    
offered on the senate  floor. Representative Fairclough said                                                                    
that the  bill had passed  the senate without  the amendment                                                                    
in  it.  Co-Chair  Stoltze rebutted  that  that  information                                                                    
should not guide the committee's decisions now.                                                                                 
                                                                                                                                
Representative  Fairclough agreed.  She commented  that when                                                                    
the  committee  attached  itself  to  a  national  standard,                                                                    
adopted in a different committee, mistakes could be made.                                                                       
                                                                                                                                
Co-Chair Stoltze  asked if the administration  supported the                                                                    
amendment.  Ms.  Siroky  stated   that  the  department  was                                                                    
ambivalent.                                                                                                                     
                                                                                                                                
Co-Chair Stoltze MAINTAINED his OBJECTION.                                                                                      
                                                                                                                                
Representative  Gara commented  that the  provisions of  the                                                                    
national  standard that  did not  make money  for the  state                                                                    
would not be followed.                                                                                                          
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Thomas, Doogan, Foster, Gara, Joule, Salmon                                                                           
OPPOSED: Austerman, Fairclough, Kelly, Stoltze, Hawker                                                                          
                                                                                                                                
The MOTION PASSED (6-5).                                                                                                        
                                                                                                                                
8:32:36 PM                                                                                                                    
                                                                                                                                
Representative Gara MOVED to ADOPT Amendment 5.                                                                                 
                                                                                                                                
     Page 15 following line 24:                                                                                                 
                                                                                                                                
          Insert "*Sec. 17. AS 44.83.080 is amended by                                                                        
               adding a new paragraph to read:                                                                                  
                                                                                                                                
          (17) to promote energy conservation, energy                                                                           
          efficiency, and alternative energy through                                                                            
          training and public education."                                                                                       
                                                                                                                                
     Renumber the following bill sections accordingly.                                                                          
                                                                                                                                
     Page 26, line 18, following "secs.":                                                                                       
                                                                                                                                
          Insert "28-35"                                                                                                        
                                                                                                                                
          Delete "27-34"                                                                                                        
                                                                                                                                
     Page 26, line 20, following "secs.":                                                                                       
                                                                                                                                
          Insert "28-35"                                                                                                        
                                                                                                                                
          Delete "27-34"                                                                                                        
                                                                                                                                
     Page 26, line 21, following "secs,":                                                                                       
                                                                                                                                
          Insert "28-35"                                                                                                        
                                                                                                                                
          Delete "27-34"                                                                                                        
                                                                                                                                
     Page 27, line 1, following "secs.":                                                                                        
                                                                                                                                
          Insert "28-35"                                                                                                        
                                                                                                                                
          Delete "27-34"                                                                                                        
                                                                                                                                
     Page 27, line 1, following "Section":                                                                                      
                                                                                                                                
          Insert "43(b)"                                                                                                        
                                                                                                                                
          Delete "42(b)"                                                                                                        
                                                                                                                                
Representative  Gara noted  that the  amendment would  allow                                                                    
the Alaska  Energy Authority (AEA) the  authority to promote                                                                    
energy   efficiency   and   conservation,   and   help   the                                                                    
legislature  move  forward  with the  deployment  of  energy                                                                    
efficiency where it  would save the state  money and benefit                                                                    
communities.  He added  that if  an  education campaign  was                                                                    
thought to be beneficial it could be included as a mandate.                                                                     
                                                                                                                                
Co-Chair Hawker  stated that the amendment  was well crafted                                                                    
and recommended it receive full support of the committee.                                                                       
                                                                                                                                
Co-Chair  Stoltze  REMOVED  his OBJECTION.  There  being  no                                                                    
further OBJECTION the motion was ADOPTED.                                                                                       
                                                                                                                                
8:35:12 PM                                                                                                                    
                                                                                                                                
Co-Chair  Hawker stated  that  the bill  had been  extremely                                                                    
well crafted  and that  he was  comfortable with  the fiscal                                                                    
notes.                                                                                                                          
                                                                                                                                
Vice- Chair  Thomas MOVED to  report HCS CS SB  220(FIN) out                                                                    
of  Committee   with  individual  recommendations   and  the                                                                    
accompanying fiscal notes.                                                                                                      
                                                                                                                                
HCS CS SB 220(FIN) was REPORTED  out of Committee with a "do                                                                    
pass"  recommendation and  with attached  new fiscal  impact                                                                    
note  by the  Department of  Revenue, new  zero note  by the                                                                    
Department  of  Transportation  and Public  Facilities,  and                                                                    
previously published  fiscal notes:  FN3 (DEC), FN  6 (DHS),                                                                    
FN7 (CED), FN8 (CED, FN9 (REV), and FN11 (ADM).                                                                                 
                                                                                                                                
8:37:01 PM     AT EASE                                                                                                        
8:50:46 PM     RECONVENE                                                                                                      
                                                                                                                                

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