Legislature(2007 - 2008)
03/13/2008 09:05 AM House CRA
| Audio | Topic |
|---|---|
| Start | |
| HB404 | |
| HB388 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
March 13, 2008
9:05 a.m.
MEMBERS PRESENT
Representative Anna Fairclough, Co-Chair
Representative Gabrielle LeDoux, Co-Chair
Representative Nancy Dahlstrom
Representative Mark Neuman
Representative Kurt Olson
Representative Sharon Cissna
MEMBERS ABSENT
Representative Woodie Salmon
COMMITTEE CALENDAR
HOUSE BILL NO. 404
"An Act establishing an Alaska Renewable Energy Task Force."
- MOVED CSHB 404(CRA) OUT OF COMMITTEE
HOUSE BILL NO. 388
"An Act establishing the Alaska Broadband Task Force; and
providing for an effective date."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 404
SHORT TITLE: ALTERNATIVE ENERGY TASK FORCE
SPONSOR(s): REPRESENTATIVE(s) FAIRCLOUGH
02/19/08 (H) READ THE FIRST TIME - REFERRALS
02/19/08 (H) CRA, FIN
03/13/08 (H) CRA AT 9:00 AM BARNES 124
BILL: HB 388
SHORT TITLE: ALASKA BROADBAND TASK FORCE
SPONSOR(s): REPRESENTATIVE(s) GUTTENBERG
02/19/08 (H) READ THE FIRST TIME - REFERRALS
02/19/08 (H) CRA, FIN
03/13/08 (H) CRA AT 9:00 AM BARNES 124
WITNESS REGISTER
STEVEN HAAGENSON, Executive Director, Alaska Industrial
Development & Export Authority (AIDEA) and Alaska Energy
Authority (AEA)
Department of Commerce, Community, & Economic Development
(DCCED)
Anchorage, Alaska
POSITION STATEMENT: During hearing of HB 404, testified as to
the approach AEA is taking related to energy.
BEN ELLIS, Managing Director
Institute of the North
Anchorage, Alaska
POSITION STATEMENT: During hearing of HB 404, testified that
the Institute of the North is supportive of the proposed task
force and would offer to help.
REPRESENTATIVE DAVID GUTTENBERG
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Spoke as the sponsor of HB 388.
RICH GAZAWAY, Administrative Law Judge, Regulatory Commission of
Alaska (RCA), Department of Commerce, Community, & Economic
Development (DCCED), Anchorage, Alaska
POSITION STATEMENT: During hearing of HB 388, provided some
insight into efforts to deploy broadband throughout Alaska.
BEN ELLIS, Managing Director
Institute of the North
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HB 388.
BRUCE JOHNSON, Director
Quality Schools/Quality Students
Alaska Association of School Boards (AASB)
Juneau, Alaska
POSITION STATEMENT: During hearing of HB 388, related support
for connectivity.
ALEX HILLS
Palmer, Alaska
POSITION STATEMENT: Testified in support of HB 388.
STEVE SMITH, Chief Information Technology Officer
Office of Information Technology
University of Alaska Fairbanks
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of HB 388.
JIM ROWE
Alaska Telephone Association
POSITION STATEMENT: Testified in support of HB 388.
ACTION NARRATIVE
CO-CHAIR GABRIELLE LEDOUX called the House Community and
Regional Affairs Standing Committee meeting to order at 9:05:18
AM. Representatives Cissna, Olson, Co-Chair Fairclough, and Co-
Chair LeDoux were present at the call to order. Representatives
Dahlstrom and Neuman arrived as the meeting was in progress.
HB 404-ALTERNATIVE ENERGY TASK FORCE
CO-CHAIR LEDOUX announced that the first order of business would
be HOUSE BILL NO. 404 "An Act establishing an Alaska Renewable
Energy Task Force."
9:05:54 AM
CO-CHAIR FAIRCLOUGH, speaking as the sponsor of HB 404, read
from the Alaska Energy Authority (AEA) "Renewable Energy Atlas
of Alaska", as follows:
As concerns about rising fossil fuel prices, energy
security, and climate changes increase, renewable
energy can play a key role in producing local, clean,
and inexhaustible energy to supply Alaska's growing
demand for electricity, heat, and transportation fuel.
Because there is little to no fuel cost associated
with generating electricity from renewable resources,
more Alaskans are looking to resources like wind,
geothermal, hydroelectric, oceans, and biomass to
hedge against the increasing cost of natural gas in
diesel fuels. Renewable energy resources provide low
risk energy that over the long term can lower costs.
With some of the best renewable energy resources in
the country, Alaska has an opportunity to be a leader
in the development and bring new revenue streams to
the state's economy.
CO-CHAIR FAIRCLOUGH pointed out that the committee packet should
include a proposed committee substitute (CS) that narrows the
scope of the proposed task force as well as who would serve on
it almost entirely to a legislative body. With regard to AEA,
Co-Chair Fairclough opined that the mission of AEA doesn't
really define what she desires for the task force to do,
although it's a component of it. Under AS 44.83.070, the
purpose of AEA is specified as follows: "The purpose of the
authority is to promote, develop, and advance the general
prosperity and economic welfare of the people of the state by
providing a means of financing and operating power projects and
facilities that recover and use waste energy and by carrying out
the powers and duties assigned to it under AS 42.45." Co-Chair
Fairclough related her belief that the legislature, the
appropriating body, must be involved in order for renewable
energy to be a priority for all of Alaska.
9:09:08 AM
REPRESENTATIVE NEUMAN moved to adopt CSHB 404, Version 25-
LS1514\E, Bullard, 3/7/08, as the working document. There being
no objection, Version E was before the committee.
9:10:01 AM
STEVEN HAAGENSON, Executive Director, Alaska Industrial
Development & Export Authority (AIDEA) and Alaska Energy
Authority (AEA), Department of Commerce, Community, & Economic
Development (DCCED), informed the committee that AEA is
currently developing a detailed [energy] plan. He explained
that first the locally available resources will be determined,
which involves going to individual subregional areas and
communities. The AEA then plans to evaluate existing technology
to determine if the available resources can be converted to
usable energy. The goal, he opined, is to replace electricity
as well as liquid fuel. Therefore, this relates to space
heating, transportation, and electricity. The next step will be
to evaluate the energy delivery systems and identify the cost of
delivery, he related. Furthermore, the energy needs for each
community will be identified in order to match the need with the
lowest cost and cleanest option available in the area. Mr.
Haagenson characterized the aforementioned as a holistic
process.
9:12:54 AM
REPRESENTATIVE NEUMAN reminded the committee that Galena was
recently approached for a nuclear power plant, and requested
comment from Mr. Haagenson.
MR. HAAGENSON said that he would evaluate all technologies. He
stated that a community may determine that it wants to use a
certain resource and prefers not to use another, which Mr.
Haagenson opined they should have the ability to do.
REPRESENTATIVE NEUMAN noted his agreement.
9:14:08 AM
REPRESENTATIVE NEUMAN inquired as to whether Mr. Haagenson
believes nuclear energy is safe.
MR. HAAGENSON answered that he didn't know, but safety should be
reviewed prior to deploying any technology. He related that he
has spoken with Marvin Yoder from the City of Galena, who says
that the technology has been around for 30 years. In fact, it
was used in the Idaho National Labs for many years. Therefore,
it's the "next generation prototype" technology. He pointed out
the need to evaluate the source of the energy, its safety, and
any unintended consequences of having nuclear waste in Alaska.
9:15:15 AM
REPRESENTATIVE NEUMAN then requested that Mr. Haagenson discuss
the Susitna hydro project.
MR. HAAGENSON related that the Susitna hydro project was
identified as a good resource that would provide reduced CO
2
emissions and cheaper energy. After a quick "back of the
napkin" analysis, Mr. Haagenson said that using a $5,000
kilowatt (kW) install cost, 8/10ths of a cent operation and
maintenance (O&M) costs, the cost of a 600 megawatt Susitna
hydro plant would amount to about $250 million a year. The
aforementioned would result in about $.05 a kW hour. However,
the cost of highly efficient gas turbines to produce 600
megawatts in Anchorage or Fairbanks would be about $500 million
a year. Therefore, due to the $250 million savings, the Susitna
hydro project is of interest and should be reviewed in terms of
the size necessary and what the resource can provide. He also
mentioned the need to make sure such a project would work for
Alaska. In further response to Representative Neuman, Mr.
Haagenson stated that the savings of $250 million a year would
need to be verified because the aforementioned numbers are rough
estimates.
9:16:50 AM
REPRESENTATIVE NEUMAN related his understanding that the
proposed task force will specify its goals and/or action items
to reach those goals. He asked if there is a plan or mission
statement.
CO-CHAIR FAIRCLOUGH referred to page 2, line 7, which specifies
that the task force would prepare a report that includes the
assessment of future statewide renewable energy needs and make
recommendations for a statewide energy plan to fulfill the
state's renewable energy needs.
9:17:57 AM
REPRESENTATIVE DAHLSTROM commented that the state is lucky to
have Mr. Haagenson serve in this capacity for the state.
Drawing from her experience with the military in Alaska, she
related that Fort Greely has much data regarding nuclear energy.
She further related that she is confident that nuclear won't be
placed in Alaska until after full research has occurred into the
possible consequences of such.
9:19:36 AM
REPRESENTATIVE CISSNA asked if communities that may have local
solutions, such as wind power or geothermal, would be considered
although they're not a statewide solution.
MR. HAAGENSON answered that all possibilities would be
considered, and that's why the communities will be approached
regarding what resources are available in the area. Mr.
Haagenson said that he would like to see Alaska become self-
reliant with regard to energy because a local job providing
local resources helps the local economy. He reiterated that he
would embrace any available technology to find the best option
to deploy in a particular community.
9:22:47 AM
REPRESENTATIVE NEUMAN recalled that there has been discussion of
development of mines in Alaska that would put in electric
generation plants for their own electricity and make the
transmission lines large enough to provide power to the local
villages as well as. He asked if the aforementioned would help
reduce some of the costs of rural electricity.
MR. HAAGENSON responded that he isn't sure that the mines will
reduce the cost of electricity, and thus that would need to be
evaluated. The delivered cost will be a factor because if the
community is too far away, it may not be economic to deliver the
electricity over certain distances. In most parts of Alaska,
the target as far as energy costs is fairly big. Mr. Haagenson
said that he would speculate that energy costs [from the mines'
electric plants] may be cheaper. With regard to the earlier
comment about self-reliance, Mr. Haagenson pointed out that
Alaska is using its own crude oil, but the problem is that "it's
crushing the economy." Therefore, he said he would like to look
for local resources to build the economy, which he characterized
as self-reliance because local fuels and local businesses would
be used to provide local energy.
9:25:12 AM
BEN ELLIS, Managing Director, Institute of the North, informed
the committee that the Institute of the North was founded in
1974 by former Governor Wally Hickel. The Institute of the
North is a 501(c)(3) that focuses on Alaska and Arctic issues.
He then mentioned that in October 2007, the Institute of the
North held the Arctic Energy Summit Technology Conference in
Anchorage. Over 300 delegates from 14 different nations
participated in that conference. The three areas the conference
reviewed were renewable energy, extractive energy, and the
challenge of providing affordable energy in rural communities.
The aforementioned is an International Polar Year (IPY) project.
To follow-up that IPY project, the Institute of the North has an
action team to review the aforementioned three areas and
challenges to develop specific road maps. One [road map] deals
with renewable energy and review of the use of tidal in both
non-ice and ice covered waters and the techniques and
technologies throughout the Arctic that would be applicable in
Alaska. These recommendations would [be presented] to the
Arctic Council Ministerial meetings, which are the eight nations
of the Arctic. The meeting will be next spring. Mr. Ellis
related that the Institute of the North is supportive of the
proposed task force and would offer to help, particularly to
bring an international perspective regarding what other Arctic
nations are doing in these areas.
9:27:15 AM
REPRESENTATIVE NEUMAN inquired as to how the Institute of the
North could work with the proposed task force. He inquired as
to how many groups are already working on this matter.
MR. ELLIS confirmed that many groups are already working on
renewable energy. He opined that the sponsor of HB 404 has
captured the majority of the players within the state. The
Institute of the North would be able to bring the Arctic
perspective, such as what's occurring in Sweden and Norway.
Furthermore, the Institute of the North could contribute to the
renewable energy issues.
9:28:34 AM
REPRESENTATIVE NEUMAN surmised that the proposed task force
would be beneficial as it would bring all groups together to
work on renewable energy.
MR. ELLIS noted his agreement. He then opined that the proposed
task force provides a structure for a lot of people to come
together to work on the energy challenges in Alaska. The
aforementioned is one of Alaska's biggest challenges.
9:29:56 AM
CO-CHAIR LEDOUX, upon determining no one else wished to testify,
closed public testimony.
REPRESENTATIVE DAHLSTROM moved to report CSHB 404, Version 25-
LS1514\E, Bullard, 3/7/08, out of committee with individual
recommendations and the accompanying fiscal notes. There being
no objection, CSHB 404(CRA) was reported from the House
Community and Regional Affairs Standing Committee.
The committee took an at-ease from 9:30 a.m. to 9:33 a.m.
HB 388-ALASKA BROADBAND TASK FORCE
9:33:03 AM
CO-CHAIR FAIRCLOUGH announced that the next order of business
would be HOUSE BILL NO. 388 "An Act establishing the Alaska
Broadband Task Force; and providing for an effective date."
REPRESENTATIVE DAVID GUTTENBERG, Alaska State Legislature,
speaking as the sponsor of HB 388, began by relating that in
November 2006 he received a letter from his Internet provider,
which also provided television services, that it was leaving the
state. December 31st television and Internet ended and he was
left only with dial-up from his telephone provider. He said
that he was without Internet service for over a year. Upon
reviewing the matter, Representative Guttenberg said that he
discovered that in the Fairbanks area there were over 2,000
people without service from various providers. The comments
from surveys he conducted in various arenas were that service
was slow, such that commerce was inhibited, folks couldn't work
from home, and students couldn't perform research. Yet, no
provider was trying to expand service to this group that had no
service. Therefore, he began working on legislation. Although
the state has little influence on Internet service, there are
lots of things the legislature can do. Representative
Guttenberg then discovered that legislation establishing a task
force had passed out of the legislature in 2003, but that task
force only produced a small PowerPoint. In February 2008, the
Institute of the North and the University of Alaska Anchorage
held a forum on this issue as well.
REPRESENTATIVE GUTTENBERG explained that he is trying to
determine what economic opportunities have been missed with
regard to bringing Internet service to all Alaskans. In rural
Alaska, Internet is only available via E-Net in the schools.
This legislation attempts to bring together a couple of
legislators and the user groups in order to determine what the
world is. This year Steve Haagenson, as chief executive officer
of Golden Valley Electric Association, established an
independent company that provides wireless Internet service as
AT&T. However, those two are only looking at the small market,
not the big picture. This legislation, on the other hand, has
huge implications for the entire state. The goal is to define
where the state is currently, where it wants to go, what needs
to be done, and allow industry to come in and plug the holes and
look over the horizon to bring Alaska to the forefront of the
industry.
9:39:48 AM
REPRESENTATIVE DAHLSTROM asked whether the sponsor has spoken
with large telecommunication companies in the state.
REPRESENTATIVE GUTTENBERG replied yes. After asking companies
if they plan to build-up their systems, the answer was no. He
indicated his understanding that the companies are "maxed out."
However, AT&T Cellular One is doing considerable things,
including entering the wireless market in Fairbanks.
9:41:39 AM
CO-CHAIR LEDOUX, referring to page 1, lines 12-14, inquired as
to the existing barriers to broadband deployment.
REPRESENTATIVE GUTTENBERG identified barriers such as equipment
limitations and physical/geographical problems.
9:42:58 AM
CO-CHAIR LEDOUX asked then if the task force may recommend
subsidies. She related her belief that existing utilities must
be looking into this and if there is money to be made they would
move forward. If the utilities don't believe there's money in
this area, then they likely believe that a market isn't
economically viable. She asked if the sponsor has heard from
the utilities that there are other problems beyond economics.
REPRESENTATIVE GUTTENBERG related that in conversations with
those other than utility companies, he has discovered
[difficulty] with the Universal Service Fund. He related his
understanding that instead of building out, the utilities are
merely building up what already exists. Representative
Guttenberg specified that he isn't looking to recommend any
subsidies, but rather to define the issue/problem, where that
issue/problem exists, and provide opportunities. However, some
in Congress say that if an entity receives the Universal Service
Fund, then it should build out its system rather than build up
its existing system. Representative Guttenberg said that he
doesn't have any preconceived ideas of where this will go.
REPRESENTATIVE DAHLSTROM, drawing from 15 years of
telecommunications experience, related that other things to
consider are distance and terrain, weather, the amount of
permafrost, whether the wires will be hung or cable buried, and
access for maintenance. She recalled that when White Alice,
Alascom existed, the federal law mandated that it provide
service to communities with 25 or more residents, no matter the
cost. She related that the aforementioned service was provided
at a financial loss to the company, at times. She said, "But
because of the federal laws and some subsidies that they were
receiving, ... that's what was done." The Universal Service
Fund is difficult to follow, she noted. Representative
Dahlstrom praised the intent of HB 388, but emphasized the need
to work with the Regulatory Commission of Alaska (RCA) and those
in Washington, D.C., as there may be the need to request some
changes to the Universal Service Fund.
9:46:56 AM
REPRESENTATIVE GUTTENBERG pointed out that coverage in the state
is so irregular and inconsistent. For example, last year fiber
optic cable was being installed from Kenny Lake, which had
[fiber optics for 10 years], to Chitna. However, he had no
coverage at his home in Fairbanks.
9:47:44 AM
REPRESENTATIVE CISSNA related that in 2000 she was a member of
the House Special Committee on Economic Development,
International Trade and Tourism, which reviewed what was
happening in the state. At that point the state was beginning
to see what was happening globally and there was a state
contract for telecommunications. Furthermore, there was
extensive training for rural teachers to help them teach in
remote communities that were to receive Internet access. There
were discussions with the local telephone companies to find ways
in which to "help fit them into the picture." Representative
Cissna emphasized that [broadband service] in Alaska can be done
and done from modest communities. She then requested comment
regarding what the state is doing that "this can fit into as
well."
REPRESENTATIVE GUTTENBERG replied he's not able to address that.
CO-CHAIR FAIRCLOUGH announced that although she's doesn't want
to hold HB 388, there is House floor session today and people
on-line who would like to testify. She said she didn't believe
the legislation would be able to move forward if the testimony
as well as the additional dialogue is allowed.
9:50:55 AM
CO-CHAIR FAIRCLOUGH then opened the public testimony.
9:51:04 AM
RICH GAZAWAY, Administrative Law Judge, Regulatory Commission of
Alaska (RCA), Department of Commerce, Community, & Economic
Development (DCCED), said he would provide some insight into
efforts to deploy broadband throughout Alaska. He related that
one effort is to administer a federally funded broadband grant.
That program has some restrictions in the appropriations
language such that it only allows funding for areas without
local dialup or broadband access. Therefore, if a community has
a dialup connection, it can't receive funding. Although there
have been efforts to amend the legislation such that areas with
poor local dialup connections and no broadband access could
receive funding, it hasn't yet been acted upon. Also, the
Federal Communications Commission (FCC) has an open docket
regarding the expansion of the Universal Service Fund to include
a broadband fund.
9:53:23 AM
BEN ELLIS, Managing Director, Institute of the North, related
the Institute of the North's support for HB 388. He informed
the committee that the Institute of the North and the University
of Alaska - Anchorage held a telecommunications workshop in
February. There were 35-40 participants at the workshop and all
of the providers were represented. Furthermore, user groups,
including those from the Native community were present. More
than 40 states use this approach, he noted.
9:54:25 AM
BRUCE JOHNSON, Director, Quality Schools/Quality Students,
Alaska Association of School Boards (AASB), related AASB's
support for connectivity, both for families and young people.
9:55:05 AM
ALEX HILLS began by informing the committee that he is the owner
of a consulting practice in Palmer that specializes in hi-tech
product development, particularly wireless. He further informed
the committee that he holds a faculty appointment as
distinguished service professor at Carnegie-Mellon University,
specializing in telecommunications policy, particularly as it
relates to deployment in rural and remote areas. He noted that
he had the privilege to chair the earlier mentioned workshop
held in Anchorage. As has been mentioned, representatives of
all the major telecommunications providers were there as well as
many others interested in telecommunications. There was general
consensus that broadband service is badly needed for economic
development, health care delivery, delivery of quality
education, and participation in the mainstream economy and
society. It was clear that broadband development in Alaska is
lagging, both when measured against other states and other parts
of the world. He then reflected on the 1970s when Alaska gained
an understanding that basic telecommunication services, which
meant radio, television, and telephone service, in rural Alaska
were lagging. Due to the leadership of then Governor Jay
Hammond and others, Alaska dramatically improved and provided
basic services throughout the state within a few years. He
noted that he was privileged to participate in that effort as
Alaska's chief telecommunications official under Governor
Hammond. Now basic services increasingly can be defined to
include broadband or high-speed Internet, and thus it's once
again time for dramatic action by the state to bring the state,
particularly rural residents, up to the international standard
for basic service. Mr. Hills suggested that HB 388 is only a
start, not an action plan as it only establishes a task force to
propose a plan. Still, Mr. Hills suggested that the committee
advance HB 388.
9:59:17 AM
STEVE SMITH, Chief Information Technology Officer, Office of
Information Technology, University of Alaska Fairbanks, related
support for HB 388. He opined that broadband technology is as
critical in this age as roads, power, and water treatment are
for the economic development, health, access to government, and
education of all of Alaska's communities. There are 33 other
states with broadband legislation, 40 states that have statutes
involving broadband. Broadband is something on which everyone
needs to work together. Although the carriers are doing their
best, they face technical, economic, regulatory, and resource
barriers. Furthermore, basic Internet service doesn't exist
throughout the state, let alone the broadband services coming.
There needs to be a comprehensive plan to work together to move
forward [with regard to telecommunications]. In conclusion, Mr.
Smith reiterated his support for HB 388.
10:01:03 AM
JIM ROWE testified in support of HB 388. As mentioned earlier,
there needs to be a thorough discussion of broadband
accessibility, even in the face of the challenges in
infrastructure and economics. He informed the committee that
the Alaska Telephone Association has interest in this matter, as
highlighted by its annual meeting in Girdwood. One of the
agenda items of that meeting is a discussion of HB 388, which
Mr. Smith will lead. There will also be a representative from
Connected Nation, Inc., who will make a presentation based on
Kentucky Connect, which has been a national example for bringing
broadband to rural areas. From the Anchorage Daily News article
titled "Web Traffic Swelling to a Slowdown," he highlighted the
following quote: "Digital traffic on the global network is
growing about 50 percent per year." The aforementioned
demonstrates the worldwide demand, he said. In conclusion, Mr.
Rowe said that he looks forward to participating with the
proposed task force.
10:03:08 AM
CO-CHAIR FAIRCLOUGH announced that any testimony can be sent to
either committee co-chair to be distributed to all committee
members. She then announced that the public hearing would be
left open for HB 388.
[HB 388 was held over.]
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 10:03:43 AM.
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