Legislature(2021 - 2022)ADAMS 519
03/01/2022 10:15 AM House ENERGY
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| HB299 | |
| HB358 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 299 | TELECONFERENCED | |
| *+ | HB 358 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ENERGY
March 1, 2022
10:19 a.m.
MEMBERS PRESENT
Representative Calvin Schrage, Chair
Representative Chris Tuck
Representative Matt Claman
Representative Tiffany Zulkosky
Representative Zack Fields
Representative George Rauscher
Representative James Kaufman
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 299
"An Act relating to microreactors."
- MOVED HB 299 OUT OF COMMITTEE
HOUSE BILL NO. 358
"An Act relating to the renewable energy grant fund and
recommendation program; and providing for an effective date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 299
SHORT TITLE: MICROREACTORS
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
02/04/22 (H) READ THE FIRST TIME - REFERRALS
02/04/22 (H) ENE, RES
02/08/22 (H) ENE AT 10:15 AM ADAMS 519
02/08/22 (H) Heard & Held
02/08/22 (H) MINUTE(ENE)
02/10/22 (H) ENE AT 10:15 AM ADAMS 519
02/10/22 (H) Heard & Held
02/10/22 (H) MINUTE(ENE)
02/15/22 (H) ENE AT 10:15 AM ADAMS 519
02/15/22 (H) Heard & Held
02/15/22 (H) MINUTE(ENE)
03/01/22 (H) ENE AT 10:15 AM ADAMS 519
BILL: HB 358
SHORT TITLE: RENEWABLE ENERGY GRANT FUND
SPONSOR(s): EDGMON
02/22/22 (H) READ THE FIRST TIME - REFERRALS
02/22/22 (H) ENE, FIN
03/01/22 (H) ENE AT 10:15 AM ADAMS 519
WITNESS REGISTER
REPRESENTATIVE BRYCE EDGMON
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, offered a brief
introduction to HB 358.
LAIB ALLENSWORTH, Staff
Representative Bryce Edgmon
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented HB 358 on behalf of
Representative Edgmon, prime sponsor.
CURTIS THAYER, Executive Director
Alaska Energy Authority
Department of Commerce, Community, and Economic Development
Anchorage, Alaska
POSITION STATEMENT: Answered questions on HB 358.
MICHAEL ROVITO, Deputy Director
Alaska Power Associates
Anchorage, Alaska
POSITION STATEMENT: Provided testimony during the hearing on HB
358.
ACTION NARRATIVE
10:19:53 AM
CHAIR CALVIN SCHRAGE called the House Special Committee on
Energy meeting to order at 10:19 a.m. Representatives Tuck,
Claman, Kaufman, Rauscher, Zulkosky, and Schrage were present at
the call to order. Representative Fields arrived as the meeting
was in progress.
HB 299-MICROREACTORS
10:20:29 AM
CHAIR SCHRAGE announced that the first order of business would
be HOUSE BILL NO. 299, "An Act relating to microreactors."
10:21:12 AM
The committee took a brief at-ease at 10:21 a.m.
10:21:36 AM
REPRESENTATIVE ZULKOSKY moved to report HB 299 out of committee
with individual recommendations and the accompanying fiscal
notes.
10:21:56 AM
REPRESENTATIVE TUCK objected for the purpose of discussion. He
referenced that in 2010 the first House Special Committee on
Energy put together an initial energy policy for the state. The
policy addressed cost-effective ways to deliver energy
throughout rural Alaska. He shared a personal antidote about a
suggestion to "park a submarine outside" of Dillingham in the
summer as an energy source for making ice for the fisheries. He
continued that then there had been an effort to get nuclear
[energy] added to the policy, but the microreactor technology
had just been developed. He surmised that it is hard to compete
with the concentration of energy that comes from nuclear
supplies, and it competes very well with wind or solar. He said
that an average person throughout his/her lifetime would produce
a "pea-sized amount of waste" using nuclear energy. He
qualified that the waste would be concentrated. Comparing the
Three Mile Island nuclear accident to the accidents at Chernobyl
and Fukushima, he argued that the results show the systems in
the U.S. are safer. He continued that unfortunately the
accidents at Chernobyl and Fukushima have "put a blackeye" on
nuclear technologies. In order to meet the energy needs of
communities in Alaska that are remote and off the main grid, he
offered his support of HB 299.
REPRESENTATIVE TUCK removed his objection. There being no
further objection, HB 299 was reported out of the House Special
Committee on Energy.
10:24:34 AM
The committee took an at-ease from 10:24 a.m. to 10:26 a.m.
HB 358-RENEWABLE ENERGY GRANT FUND
10:26:41 AM
CHAIR SCHRAGE announced that the final order of business would
be HOUSE BILL NO. 358, "An Act relating to the renewable energy
grant fund and recommendation program; and providing for an
effective date."
10:26:44 AM
REPRESENTATIVE BRYCE EDGMON, Alaska State Legislature, as prime
sponsor, offered a brief introduction to HB 358. He stated that
the proposed legislation would extend the Renewable Energy Fund
(REF) grant program, which the Special Committee on Energy
created in 2009. Following a period of austerity in the state
due to low oil prices, he said that in 2009 the state had been
"flush" with oil money. At that time there had been an effort
to address energy needs with the surplus of money, and the state
created energy assistance programs, including REF. Since that
time, he estimated $50 million to $100 million have gone into
programs. He said, "Clearly this committee does not need to be
reminded that Alaska is a storehouse of vast renewable energy
opportunities, running the entire gamut from solar down to
geothermal, and the wind turbines."
10:29:52 AM
LAIB ALLENSWORTH, Staff, Representative Bryce Edgmon, presented
HB 358 on behalf of Representative Edgmon, prime sponsor. He
stated that the proposed legislation would extend the REF grant
program for 10 years. He reported that, since its inception in
2008, REF has distributed over $275 million in grant money for
renewable energy projects. He said that 244 grants have been
given, and 95 projects are currently providing renewable energy
to high-cost energy areas in the state. He stated that the
proposed legislation is fairly simple. It would amend the 2008
law, as amended in 2012, to add a repeal date of June 30, 2033.
An immediate effective date would be added, and there would be a
fiscal note for $1.4 million, which is included in the
governor's budget. He stated that the fiscal note would be for
the maintenance of the fund, which includes financial services
and the oversite of existing and new grants. He explained that
the REF grant program operates in rounds of open applications,
and currently Round 14 is in process. Applications are
considered based on their economic and technical feasibility.
Once AEA makes recommendations, it sends the applications to the
Renewable Energy Fund Advisory Committee (REFAC), and REFAC
sends its recommendations to the legislature for approval. He
deduced that improved technology would make added resources for
renewable energy available; thus, AEA would receive more
applications in the future.
10:32:38 AM
REPRESENTATIVE RAUSCHER, referencing the fiscal note, questioned
whether the $1.4 million, under services, would be a capital
outlay. If so, he questioned which services would be funded.
REPRESENTATIVE EDGMON responded that he had asked DCCED this
question. He clarified that the $1.4 million is not new money.
It is existing money, operational in scope, used to run the
renewable energy grant program. He said the competitive grant
process currently is in Round 14, which entails an infusion of
money to administer. He explained that since the passage of
legislation in 2016 the funding sources for the program go
through the "waterfall" effect of the Power Cost Equalization
Endowment Fund. He said that the $1.4 million is the money to
operate the program with AEA, and this is already embedded in
the budget.
10:34:06 AM
REPRESENTATIVE EDGMON, in response to a follow-up question,
reiterated that the money is used to operate the program. He
deferred to Mr. Allensworth.
LAIB ALLENSWORTH explained that the $1.4 million is for grant
management oversite, project management, and technical and
accounting support for the fund. He added that, in general, it
provides the maintenance needed to keep the program going by
supporting existing projects and managing the financial side of
the fund.
10:35:12 AM
CHAIR SCHRAGE requested that [a representative from the
Department of Commerce, Community, and Economic Development
(DCCED)] clarify the funding [on the fiscal note].
10:35:28 AM
CURTIS THAYER, Executive Director, Alaska Energy Authority
(AEA), Department of Commerce, Community, and Economic
Development, explained that the $1.4 million is the current
funding for [REF] Round 13. He stated that the fiscal note is
indeterminate because future costs of the program would be
directly related to the money available to the fund, number of
participants, and length of the grants. He explained that there
are currently 38 active grants, and the $1.4 million is to
manage those grants with staff time for the next five years. He
continued that if there were no funding in the future, there
would be no future cost for the program, as these funds are to
maintain the active grants. He reiterated that [REF] Round 14
is complete, and through the "cascading waterfall" [effect]
there is $15 million in the governor's budget for this round.
He stated that 39 applicants are going through the process, but
not all of these applicants will meet the standards. He stated
that the $15 million covers these ongoing costs. He reiterated
that future costs would be determined by the legislature.
10:37:36 AM
MR. THAYER, responding to a follow-up question, clarified that
AEA currently has budgeted funding for current grants though
this program. He explained that the funding would be
indeterminate. He gave the following example: if next year the
legislature puts $50 million into the program, the fiscal note
would be higher because of the need to manage the increased
funds and grants; if the program is unfunded next year, there
would be no cost for maintaining the program because no grants
would be issued.
10:38:50 AM
REPRESENTATIVE CLAMAN questioned the language in the fiscal note
analysis that related there would be no new grants issued if the
proposed legislation is adopted.
MR. THAYER responded that the language is drafted this way
because the proposed legislation would only extend the program;
the approval of future grants would be by the legislature and
governor, and this remains unknown. He stated that there is not
a guaranteed revenue source for the grant program, as it is
funded year by year. He added that this year $15 million has
been requested, last year $4.7 million had been requested, and
the previous three years the legislature did not fund the
program. He stated that if the bill is adopted, no grants would
be issued until funding is approved.
10:40:09 AM
REPRESENTATIVE CLAMAN, with a follow-up comment, expressed the
understanding that HB 358 would not authorize new grants in and
of itself. He continued that the legislature could authorize
more grants in a separate action, but the proposed legislation
would not create new grants.
MR.THAYER responded in agreement.
10:40:30 AM
REPRESENTATIVE FIELDS questioned how REF would work in relation
to competitive grants disbursed through the federal
Infrastructure Investment and Jobs Act (IIJA). He speculated
that there could be dozens of competitive grants. He expressed
the assumption that some of the REF money could be used as a
match to compete for the IIJA money. He requested that Mr.
Thayer comment on this.
10:41:04 AM
MR. THAYER responded that AEA is investigating what is available
through IIJA, as some state funds may be matched with federal
dollars. He stated that historically around $270 million [from
REF] has been appropriated, and there has been $138 million in
applicant matching funds to date. He stated that matching grant
funds have been successful, but guidance is still being sought
on IIJA. For the committee's current purpose, the proposed
legislation would extend the program to 2033. He stated that
IIJA would be one of the areas for future consideration.
10:42:07 AM
REPRESENTATIVE EDGMON recollected that REF has often been used
as startup funding, directing the money toward the feasibility
or design stage. He suggested that this has been the practice
because renewable energy ultimately does not "pencil out." He
added that renewable energy is worth exploring because the
possibility is there. He referenced communities with wind
turbine projects that were initially feasible but do not operate
now. Referencing the purpose of the grants from REF, he asked
Mr. Thayer whether this money would align with the "shovel ready
aspect" of IIJA money. He considered that it may complement the
federal money.
MR. THAYER replied that this is a good point. He clarified that
much of REF is for start-up money and provided the example of
the hydro project in Angoon which is now requesting IIJA funds
to move to the construction stage. He continued that many of
the REF grants were given to test the viability of a project.
Referencing the history of REF, he said that the fund has put
$34 million towards Railbelt issues and $250 million into rural
Alaska. He said that [REF] Round 13 [grants] include wind
feasibility in Unalaska, hydro storage in Cordova, and wind
energy feasibility and conceptual design in Goodnews Bay. He
considered that most of these are the building blocks to obtain
additional federal funding, whether it is IIAJ or other sources.
He explained that AEA also has a Power Project Fund providing
loans for feasibility, final design, or preliminary construction
on viable projects. He said that this fund can also work as a
complementary program, but the first step would be to determine
the feasibility.
10:45:28 AM
REPRESENTATIVE FIELDS said, "That's very compelling information
that motivates me more to help get this bill across the finish
line." He questioned whether the $15 million in the budget
would be "adequate to position us to do the necessary planning
to compete for these funds." He expressed the opinion that
[AEA] has more competition for funds than the other [DCCED]
programs.
10:45:58 AM
MR. THAYER responded that when AEA made its budget for the year,
$15 million had been set aside for legislative consideration for
this program. He said that during this time AEA began [REF]
Round 14 with 39 applicants for a total of $19.2 million in
requests. He expressed the opinion that some applications will
be disqualified for various reasons, but AEA is well positioned
within the [designated] $15 million. He suggested that in the
future the legislature may want to direct attention to raising
the eligibility cap for communities. He stated that right now
AEA is operating at $1 million while grant requests are
operating at $500,000. He expressed the realization that this
is not currently under consideration for the proposed
legislation.
10:47:21 AM
REPRESENTATIVE EDGMON, in reference to a point made by
Representative Fields, stated that the legislature renews many
different state boards. He explained that [renewing the REF
program] for 10 years is justified considering the past
performance of the fund and support it would provide in the
future. He suggested that the extension would give communities
which currently do not qualify for a grant an opportunity to
apply in the next few years. He questioned whether the Denali
Commission has come before the committee. He stated that the
Denali Commission is receiving $75 million through IIJA and has
an interest in energy projects. He suggested that the committee
invite the commission to join the conversation.
10:48:41 AM
MR. THAYER, in response to Representative Rauscher, stated that
he would provide to the committee a cost breakdown of the $1.4
million over the past two years.
CHAIR SCHRAGE, in response to Representative Edgmon, commented
that the committee would welcome the Denali Commission and
questioned whether Mr. Thayer would be able to facilitate this.
He added that the committee would also be interested in further
discussions with AEA about some of the grant opportunities.
MR. THAYER responded that he would reach out to the Denali
Commission. He pointed out that AEA has been working with the
Denali Commission as a primary partner on powerhouse and bulk
fuel projects, and discussions have focused on the $75 million
[from IIJA]. He added that about $1.1 billion would be needed
to maintain these two programs, and AEA and the Denali
Commission have been tackling this. He acknowledged that not
all of the [$75 million] would be available to the state, as the
Denali Commission has other projects.
10:50:51 AM
CHAIR SCHRAGE opened public test on HB 358.
10:51:12 AM
MICHAEL ROVITO, Deputy Director, Alaska Power Associates (APA),
shared that APA is a statewide trade association for electric
utilities in Alaska serving more than 500,000 Alaskans across
the state. He offered that APA is in full support of HB 358 and
strongly urges passage of the bill this session. He stated that
many of APA's electric utility members have received crucial
funding from REF. These funds have supported the addition of
renewable energy projects which have lowered reliance on diesel
fuel, stabilized rates, and decreased the carbon footprint. As
mentioned during the hearing, he stated that there have been 244
REF grants totaling $275 million since the program's inception.
These funds have helped build over 95 operating projects, saving
more than 30 million gallons of diesel each year. He expressed
the opinion that REF is an extremely valuable program and is
worthy of continued operation. He drew attention to the
numerous projects under consideration for future rounds of REF
grants. As in the past, a deliberative process run by the AEA,
and reviewed by REFAC, would choose the projects. Extending the
sunset date of the program would continue the innovation of the
power systems in the state. He thanked the bill sponsor and the
committee.
10:53:17 AM
CHAIR SCHRAGE, after ascertaining there was no one else who
wished to testify, closed public testimony on HB 358.
10:53:23 AM
CHAIR SCHRAGE announced HB 358 was held over.
10:53:37 AM
ADJOURNMENT
CHAIR SCHRAGE There being no further business before the
committee, the House Special Committee on Energy was adjourned
at 10:53 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 299 DEC Fiscal Note 2.4.2022.pdf |
HENE 3/1/2022 10:15:00 AM |
HB 299 |
| HB 299 Sectional Analysis version A.pdf |
HENE 2/8/2022 10:15:00 AM HENE 3/1/2022 10:15:00 AM HRES 3/11/2022 1:00:00 PM |
HB 299 |
| HB 299 Research & Background.pdf |
HENE 2/8/2022 10:15:00 AM HENE 3/1/2022 10:15:00 AM HRES 3/11/2022 1:00:00 PM |
HB 299 |
| HB 299 Testimony - Received as of 02.07.22.pdf |
HENE 2/8/2022 10:15:00 AM HENE 3/1/2022 10:15:00 AM |
HB 299 |
| HB 299 APA Letter of Support.pdf |
HENE 2/8/2022 10:15:00 AM HENE 3/1/2022 10:15:00 AM HRES 3/11/2022 1:00:00 PM |
HB 299 |
| HB 358 Sponsor Statement 2.24.2022.pdf |
HCRA 3/3/2022 10:15:00 AM HENE 3/1/2022 10:15:00 AM HENE 3/3/2022 10:15:00 AM |
HB 358 |
| HB 358 Sectional Analysis 2.24.2022.pdf |
HCRA 3/3/2022 10:15:00 AM HENE 3/1/2022 10:15:00 AM HENE 3/3/2022 10:15:00 AM |
HB 358 |
| HB 358 A.PDF |
HCRA 3/3/2022 10:15:00 AM HENE 3/1/2022 10:15:00 AM HENE 3/3/2022 10:15:00 AM |
HB 358 |
| HB 358 Renewable Energy Fund Fact Sheet 02.11.2022.pdf |
HENE 3/1/2022 10:15:00 AM |
HB 358 |
| HB 358 REF Projects By Region 04.14.2021.pdf |
HENE 3/1/2022 10:15:00 AM |
HB 358 |
| HB 358 Alaska Energy Policy.pdf |
HENE 3/1/2022 10:15:00 AM |
HB 358 |
| HB 358 APA Support.pdf |
HENE 3/1/2022 10:15:00 AM |
HB 358 |
| HB 358 DCCED Fiscal Note 2.25.2022.pdf |
HENE 3/1/2022 10:15:00 AM HENE 3/3/2022 10:15:00 AM |
HB 358 |