Legislature(2009 - 2010)BUTROVICH 205

04/06/2010 03:30 PM RESOURCES


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Bills Previously Heard/Scheduled TELECONFERENCED
+ HB 306 STATE ENERGY POLICY TELECONFERENCED
Heard & Held
= SB 271 OIL AND GAS PROD. TAX: CREDITS/INTEREST
Heard & Held
                   HB 306-STATE ENERGY POLICY                                                                               
                                                                                                                              
4:22:27 PM                                                                                                                    
CO-CHAIR  MCGUIRE   announced  consideration  of  HB   306  [CSHB
306(RES) was before the committee].                                                                                             
                                                                                                                                
REPRESENTATIVE  BRYCE EDGMON,  sponsor  of HB  306, related  that                                                               
last year a  stakeholders' group met every month  to consider all                                                               
the various  aspects of putting  a state energy  policy together.                                                               
The group had  membership from the supply and demand  side of the                                                               
energy  equation, the  academic side,  the Denali  Commission, as                                                               
well as  the Resource  Development Council  and members  from the                                                               
conservation community.  In December they emerged  with an energy                                                               
policy  and  that  energy  policy,  while  it  has  been  amended                                                               
somewhat, is  before them  in HB  306. It  passed the  House with                                                               
great vigor.                                                                                                                    
                                                                                                                                
4:24:47 PM                                                                                                                    
CO-CHAIR MCGUIRE said  the committee enjoyed working  with him on                                                               
this issue  and the  policy language in  the Senate  bill mirrors                                                               
the policy in this bill. She  said that Senator Huggins had taken                                                               
a  leadership role  on  the  subject of  nuclear  energy and  the                                                               
potential Alaska  has there, and  the Senate bill was  amended to                                                               
reflect   that.  She   asked   what  he   thought  about   adding                                                               
"alternative energy" alongside "renewable energy".                                                                              
                                                                                                                                
REPRESENTATIVE EDGMON replied that it is worth considering.                                                                     
                                                                                                                                
4:26:03 PM                                                                                                                    
CHRIS ROSE,  Executive Director, Renewable Energy  Alaska Project                                                               
(REAP),  introduced  himself.  He   listed  the  members  of  the                                                               
Stakeholder  Advisory Panel  that  was put  together  by the  co-                                                               
chairs  of the  House Special  Committee  on Energy.  He said  it                                                               
started  with a  relatively  small document  that  grew to  seven                                                               
pages.  All realized  that  what  they were  really  after was  a                                                               
comprehensive  energy  policy  that  would set  up  sidebars  for                                                               
planning decisions and goals down the road.                                                                                     
                                                                                                                                
4:29:27 PM                                                                                                                    
BILL  POPP, Anchorage  Economic  Development Corporation  (AEDC),                                                               
said the design was to  develop an overarching energy policy that                                                               
would be  the foundation for  establishing energy goals  and then                                                               
plans  while  taking  into account  regional  differences.  State                                                               
government would be  aligned in a unified set  of strategic goals                                                               
which would  help in  developing a  comprehensive energy  plan to                                                               
achieve them.  The policy leaves a  lot of room for  new thinking                                                               
and new direction.                                                                                                              
                                                                                                                                
4:30:57 PM                                                                                                                    
MR.  ROSE said  it has  four key  steps: establishing  the energy                                                               
policy, developing strategic goals,  creating the plan to achieve                                                               
the goals  and implementing programs and  projects. People always                                                               
came  back to  the fact  that  they were  establishing an  energy                                                               
vision for  the state and  not talking about projects  and plans.                                                               
The bill  is entitled "State  Energy Policy" and has  five goals,                                                               
number five  was added  by the  House for the  State to  become a                                                               
leader  in  natural  gas  production,   and  that  is  where  the                                                               
renewable alternative energy policy is in the bill.                                                                             
                                                                                                                                
4:32:40 PM                                                                                                                    
MR.  POPP  turned to  the  guiding  principles that  pushed  this                                                               
process  and said  the  future success  of  the Alaska  statewide                                                               
economy is tied to available,  reliable and affordable energy for                                                               
residential, commercial and  industrial users.  Energy  is key to                                                               
the future  of economic  growth in  Alaska. They  also recognized                                                               
that worldwide  supply and demand  for fossil fuels  and concerns                                                               
about  global climate  change  will affect  the  price of  fossil                                                               
fuels in  the future. Oil is  already being seen in  the mid-$80s                                                               
when just a few  months ago it was down in the  $30s and a little                                                               
over  1.5 years  ago  it  was up  near  $150  a barrel.  Assuring                                                               
stability in energy prices and  energy availability is paramount.                                                               
They  don't have  to guarantee  the lowest  prices, but  Alaskans                                                               
shouldn't have to be paying the highest prices either.                                                                          
                                                                                                                                
4:33:48 PM                                                                                                                    
MR. ROSE related that a  few years ago the Tri-Borough Commission                                                               
(the Mat-Su Borough, the Municipality  of Anchorage and the Kenai                                                               
Peninsula  Borough) developed  a  private-sector oriented  Energy                                                               
Policy  Task  Force  to  deal  with  the  issues  Mr.  Popp  just                                                               
mentioned. After  meeting for about  four months, they  were able                                                               
to  come up  with the  policy they  presented to  the stakeholder                                                               
group, and a large portion  of the portfolio included renewables.                                                               
The policy was developed initially  for South Central Alaska, but                                                               
was broadened into a statewide policy.                                                                                          
                                                                                                                                
4:35:28 PM                                                                                                                    
MR. POPP  said the policy that  has been passed out  of the House                                                               
promotes energy efficiency  and conservation as a  key premise as                                                               
something that  can be done immediately;  it promotes development                                                               
of renewable  and non-renewable  energy resources  and recognizes                                                               
the  state  has  a  portfolio of  available  energy  sources.  It                                                               
orients towards market  forces as to what solutions  float to the                                                               
top  on  a  statewide-one-size-fits-all  basis,  but  recognizing                                                               
regional  differences. It  promotes economic  development through                                                               
long  term sources  of  energy  that are  going  to  be vital  to                                                               
communities statewide in the coming decades.                                                                                    
                                                                                                                                
It supports energy research education  and work force development                                                               
so that  Alaska can  take advantage  of the  full value  chain of                                                               
energy development,  not just the  end cost of  delivered energy.                                                               
Research could be monetized and  the educational aspects would be                                                               
important  to   establishing  Alaska  as  a   center  for  energy                                                               
research,  as  wells as  the  work  force development  pieces  to                                                               
establish these  energy infrastructures  and develop  and deliver                                                               
them   cost  effectively.   It  supports   the  coordination   of                                                               
governmental functions  and promotes a better  regulatory process                                                               
so  that regulations  are  developed within  the  umbrella of  an                                                               
energy  policy and  not in  an individual  agency's vacuum.  This                                                               
will  bring  an  overall  coordination  and  efficiency  that  is                                                               
currently  lacking at  all  levels of  state  government when  it                                                               
comes to energy policy.                                                                                                         
                                                                                                                                
4:37:50 PM                                                                                                                    
MR. ROSE  concluded that both the  task force and the  House have                                                               
put together a document that  establishes a long term vision that                                                               
can be  used to develop  and achieve energy  goals. A lot  of the                                                               
work done  on bills such  as SB 220  complement this work,  but a                                                               
lot of  things have yet to  be addressed; and having  this policy                                                               
pass is going to be a key  element to making sure the best energy                                                               
resources are  available to  Alaskans -  something that  has been                                                               
missing.                                                                                                                        
                                                                                                                                
4:39:10 PM                                                                                                                    
CO-CHAIR WIELECHOWSKI  said one difference between  the House and                                                               
Senate  versions is  that the  intent is  written into  the House                                                               
version and  the Senate version  includes a letter of  intent. He                                                               
asked how they feel about this.                                                                                                 
                                                                                                                                
MR. POPP  responded that he  feels the  intent needs to  have the                                                               
force of  law, otherwise  it becomes  subject to  the whims  of a                                                               
given year's policy.                                                                                                            
                                                                                                                                
4:40:36 PM                                                                                                                    
CO-CHAIR WIELECHOWSKI  asked Michael  Nave if  the administration                                                               
had any  opinion on the  question of intent versus  having policy                                                               
in statute.                                                                                                                     
                                                                                                                                
MICHAEL  NAVE,   Department  of  Law  (DOL),   replied  that  the                                                               
department  understands  that  it   is  a  policy  statement  and                                                               
therefore, that is how they've been analyzing it.                                                                               
                                                                                                                                
CO-CHAIR WIELECHOWSKI  said bluntly when  his staff met  with DOL                                                               
staff, the DOL  was adamant that they did not  want the intent in                                                               
law, but  would prefer it  as intent.  He asked if  that position                                                               
has changed.                                                                                                                    
                                                                                                                                
MR. NAVE answered no, that was  the request and it was understood                                                               
that this was a policy statement.                                                                                               
                                                                                                                                
SENATOR WIELECHOWSKI asked if he  has an opinion or preference on                                                               
whether or not this should be policy in law or policy in intent.                                                                
                                                                                                                                
MR. NAVE  said his opinion is  that this statute as  written is a                                                               
statement of policy.                                                                                                            
                                                                                                                                
4:42:26 PM                                                                                                                    
SARAH  FISHER-GOAD, Deputy  Director,  Operations, Alaska  Energy                                                               
Authority (AEA), said regarding  concerns about having the policy                                                               
in Title 44.99 rather than in  un-codified law as in SB 220, that                                                               
the preference  is to have  it as  it is in  SB 220. Part  of the                                                               
reason is that  AS 44.99 hasn't been amended to  add new policies                                                               
for several years which was  due to the potential for litigation.                                                               
She had offered  the staff some language that  would address some                                                               
of the  concerns the  department has  with SB  220, and  they are                                                               
catching  up  with  where  HB  306 comes  in.  She  believed  the                                                               
confusion came up when Senator  McGuire mentioned that the Senate                                                               
bill "mirrored"  the House bill.  She added that two  other minor                                                               
changes will help with policy language.                                                                                         
                                                                                                                                
CO-CHAIR WIELECHOWSKI said he thought  he just heard that DOL has                                                               
no  problem  with  HB  306  as policy  and  asked  if  she  heard                                                               
something different.                                                                                                            
                                                                                                                                
MS.  FISHER-GOAD  replied that  her  understanding  is that  they                                                               
prefer  SB  220, and  HB  306  would  be  OK with  the  suggested                                                               
amendments.                                                                                                                     
                                                                                                                                
4:45:34 PM                                                                                                                    
STEVE  HAGENSON,  Executive  Director,  Alaska  Energy  Authority                                                               
(AEA), commented that  he was not a member of  the committee, but                                                               
they invited  him to participate.  He enjoyed the  interaction he                                                               
had with  staff from both bodies  and the work group.  He thought                                                               
they produced a quality document.                                                                                               
                                                                                                                                
4:46:20 PM                                                                                                                    
CO-CHAIR WIELECHOWSKI asked if he supports HB 306.                                                                              
                                                                                                                                
MR. HAGENSON answered yes.                                                                                                      
                                                                                                                                
4:46:52 PM                                                                                                                    
BRIAN  KANE,  Legislative   Legal,  Legislative  Affairs  Agency,                                                               
Alaska State Legislature, said he was available for questions.                                                                  
                                                                                                                                
4:47:13 PM                                                                                                                    
ELIZABETH   OUTTEN,   Statewide    Energy   Coordinator,   Alaska                                                               
Conservation Alliance, said they support  both HB 306 and SB 220.                                                               
They  show a  commitment  to  long term  energy  planning and  it                                                               
continues  to put  Alaska on  an economically  viable sustainable                                                               
stable energy  path to  the future, and  provides the  very much-                                                               
needed vision  to help  guide the  state's energy  decisions. The                                                               
Alliance strongly supported  including provisions encouraging the                                                               
state and  public focus  on energy efficiency  first, and  it has                                                               
identified it as a priority  issue for this session. They support                                                               
the  establishment  of  statewide   energy  efficiency  codes  to                                                               
decrease energy use in public  buildings through efficiencies and                                                               
educating  the public  about opportunities  and  support that  is                                                               
available to them to be more energy efficient.                                                                                  
                                                                                                                                
MS.  OUTTEN   said  they  also   support  the   renewable  energy                                                               
development provisions  because Alaska has so  many opportunities                                                               
to meet  its energy  needs with  renewable energy.  Finally, they                                                               
also support the  provisions that help Alaska become  a leader in                                                               
energy  development and  deployment of  new energy  technologies.                                                               
The Alliance  had identified emerging technology  development and                                                               
deployment  as  a priority  issue  for  this session.  They  were                                                               
excited to see these provisions included in SB 220.                                                                             
                                                                                                                                
4:49:26 PM                                                                                                                    
CO-CHAIR WIELECHOWSKI closed public testimony.                                                                                  
                                                                                                                                
4:49:43 PM                                                                                                                    
REPRESENTATIVE EDGMON  closed by  thanking everyone for  the time                                                               
and  work  they  put  into   this  document  and  emphasized  the                                                               
importance of putting the goals  and objectives in the front part                                                               
of the bill into policy.                                                                                                        
                                                                                                                                
SENATOR HUGGINS thanked Representative Edgmon for his effort.                                                                   
                                                                                                                                
4:51:50 PM                                                                                                                    
CO-CHAIR  WIELECHOWSKI  echoed  those  comments  and  finding  no                                                               
further business to  come before the committee,  he adjourned the                                                               
meeting at 4:51 p.m.                                                                                                            

Document Name Date/Time Subjects
HB 306 - Bill Packet.pdf SRES 4/6/2010 3:30:00 PM
HB 306