Legislature(2007 - 2008)BUTROVICH 205
04/11/2007 03:30 PM Senate RESOURCES
Audio | Topic |
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Start | |
Conocophillips | |
SB91 | |
SB44 | |
Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
*+ | SB 91 | TELECONFERENCED | |
*+ | SB 44 | TELECONFERENCED | |
+ | TELECONFERENCED | ||
+ | TELECONFERENCED |
SB 44-APPROP: FIRE ISLAND WIND FARM 5:05:37 PM CHAIR HUGGINS announced SB 44 to be up for consideration. SENATOR MCGUIRE, sponsor of SB 44, said the history behind the issue began in the 1970s when oil revenue came on line through TAPS and $500 million was set aside for what was called the Susitna Rive project, a specific project, but the concept was to help fuel the Railbelt. Later, in 1985, the Susitna project was cancelled and $340 million was left and that is when the Railbelt Energy Fund was created. The idea behind it was that the Fund would fuel projects that help improve the grid along the Railbelt. They talk about the Northern Intertie and the Southern Intertie. The Northern Intertie consists of Fairbanks and friends and they have succeeded in using a large portion of that money to help improve their grid. She provided the committee with a list of projects and noted some projects were off the Railbelt - places like Kodiak, Valdez, Glennallen, Southeast Four Dam Pool and power/cost equalization (which has nothing to do with the Railbelt). SENATOR MCGUIRE said SB 44 proposes to use a portion of the Railbelt Energy Fund for what it was created for and that would be to help improve power production and distribution to Southcentral Alaska. The concept is that $24 million would be distributed through the Department of Commerce, Community & Economic Development through a system that was set up by the legislature by which grants are distributed. So, she is not proposing something unusual. This money would go towards the building of critical infrastructure. The federal government also has an incentives package that expires on December 31, 2007. So, there is an opportunity to have some federal assistance in this project. The partners in it now include Cook Inlet Regional Incorporation (CIRI) that owns the land the wind generators would be located on. 5:09:35 PM The concept is that roughly 33 wind turbines would be built on Fire Island on a site that has been carefully crafted to maximize a desirable level of wind. She pointed out that Alaska is well behind the alternative energy curve and 30 states now have wind turbines as a major source of energy for their communities. She said that Canada and Europe have used wind power for over a decade. SENATOR McGUIRE explained that what is unique about Cook Inlet is that their homes are sitting either directly on or close to some very serious hydro-carbon reserves, but developing that gas won't happen in enough time to serve the needs of the community. Right now Anchorage depends on natural gas for 85 percent of its residential and commercial needs. It is estimated that in the next seven years, they will not have the energy they need. She said depending on their size, turbines generate 1.5 to 3.6 megawatts of electricity that could extend service to Southcentral and as far north as Fairbanks. This is the reason Golden Valley Electric is interested in this project. That community is suffering more than hers. 5:12:33 PM She said there is a lot of politics in this area and she would hate to see a good idea that follows the principals of the Railbelt Energy Fund to fall by the wayside because of it. She concluded that it is time to do this project. It isn't replacing the hydro-carbon industry in this state, but supplementing it. SENATOR McGUIRE said the planning and feasibility are well under way and a contribution of $24 million from a fund that was designed to help put power into the grid seems to her to be a pretty good bill. 5:13:53 PM MARIT CARLSON-VAN DORT, staff to Senator McGuire, said she was available to answer questions. JAMES POSEY, General Manager, Anchorage Municipal Light and Power (ML&P), said he is an officer with the Alaska Railbelt Energy Authority (AREA). He said ML&P serves about 29,000 customers in Anchorage and the AREA was formed by three of the largest utilities - Golden Valley Electric, Chugach Electric (CEA) and ML&P one and a half years ago. He said the utilities have concluded that Fire Island could provide good wind and renewable energy. It would have ample expansion acreage to support a major wind facility and one that would be located near the Railbelt system's largest load center and which would provide a source of clean renewable energy. CEA, ML&P, CIRI and Homer have continued research on the Island this year to keep the project going. Getting clean power is important; infrastructure support is important for the connectivity that is required in this medium-sized load center called the Railbelt area. 5:16:38 PM CHAIR HUGGINS asked after the first few years of the project what would the price per kilowatt hour be. MR. POSEY replied 6.5 cents to 9 cents per kilowatt. He currently charges 8.5 cents. SENATOR WAGONER asked what costs are figured into that kilowatt price. MR. POSEY replied that the kilowatt price is just the cost of putting up the turbines and delivering the power that comes out of them. The infrastructure support is the connectivity - the line to the Island and transformers, as well as roads and a little dock. He said the merchant industry puts them up and owns them for 6 - 12 years until the tax credits are done and then generally his area would look at running them for the next 30 to 40 years. There are lots of different ways to approach that. The 6.5 cents to 9 cents would be a long term price. 5:18:13 PM SENATOR WAGONER asked if that figure included the price to be paid to CIRI for the location lease. MR. POSEY replied yes, and they would be an owner of the wind turbines as well. CHAIR HUGGINS explained that the committee had to adjourn for other meetings; public testimony on SB 44 would continue at the next hearing. He then adjourned the meeting at 5:19:30 PM.
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