02/21/2020 03:30 PM Senate RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| SB171 | |
| SB150 | |
| SB161 | |
| SB155 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 171 | TELECONFERENCED | |
| += | SB 161 | TELECONFERENCED | |
| *+ | SB 150 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 155 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
February 21, 2020
3:30 p.m.
MEMBERS PRESENT
Senator Peter Micciche, Chair
Senator John Coghill, Vice Chair
Senator Click Bishop
Senator Cathy Giessel
Senator Joshua Revak
Senator Jesse Kiehl
MEMBERS ABSENT
Senator Scott Kawasaki
COMMITTEE CALENDAR
SENATE BILL NO. 171
"An Act relating to industrial hemp."
- MOVED CSSB 171(RES) OUT OF COMMITTEE
SENATE BILL NO. 150
"An Act repealing the termination date for the intensive
management hunting license surcharge."
- MOVED SB 150 OUT OF COMMITTEE
SENATE BILL NO. 161
"An Act relating to geothermal resources; relating to the
definition of 'geothermal resources'; and providing for an
effective date."
- HEARD & HELD
SPONSOR SUBSTITUTE FOR SENATE BILL NO. 155
"An Act relating to exploration and mining rights; relating to
annual labor requirements with respect to mining claims and
related leases; relating to statements of annual labor; defining
'labor'; and providing for an effective date."
- MOVED CSSSSB 155(RES) OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: SB 171
SHORT TITLE: INDUSTRIAL HEMP PROGRAM; MANUFACTURING
SPONSOR(s): SENATOR(s) HUGHES
01/31/20 (S) READ THE FIRST TIME - REFERRALS
01/31/20 (S) RES
02/10/20 (S) RES AT 3:30 PM BUTROVICH 205
02/10/20 (S) Heard & Held
02/10/20 (S) MINUTE(RES)
02/21/20 (S) RES AT 3:30 PM BUTROVICH 205
BILL: SB 150
SHORT TITLE: INTENSIVE MGMT SURCHARGE/REPEAL TERM DATE
SPONSOR(s): REVAK
01/21/20 (S) READ THE FIRST TIME - REFERRALS
01/21/20 (S) RES, FIN
02/21/20 (S) RES AT 3:30 PM BUTROVICH 205
BILL: SB 161
SHORT TITLE: GEOTHERMAL RESOURCES
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
01/22/20 (S) READ THE FIRST TIME - REFERRALS
01/22/20 (S) RES, FIN
02/10/20 (S) RES AT 3:30 PM BUTROVICH 205
02/10/20 (S) Heard & Held
02/10/20 (S) MINUTE(RES)
02/21/20 (S) RES AT 3:30 PM BUTROVICH 205
BILL: SB 155
SHORT TITLE: EXPLORATION & MINING RIGHTS; ANNUAL LABOR
SPONSOR(s): BISHOP
01/21/20 (S) READ THE FIRST TIME - REFERRALS
01/21/20 (S) RES, FIN
02/03/20 (S) SPONSOR SUBSTITUTE INTRODUCED-REFERRALS
02/03/20 (S) RES, FIN
02/05/20 (S) RES AT 3:30 PM BUTROVICH 205
02/05/20 (S) Heard & Held
02/05/20 (S) MINUTE(RES)
02/14/20 (S) RES AT 3:30 PM BUTROVICH 205
02/14/20 (S) Heard & Held
02/14/20 (S) MINUTE(RES)
02/19/20 (S) RES AT 3:30 PM BUTROVICH 205
02/19/20 (S) Heard & Held
02/19/20 (S) MINUTE(RES)
02/21/20 (S) RES AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
SENATOR SHELLEY HUGHES
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of SB 171, discussed the changes in
the committee substitute SB 171.
BUDDY WHITT, Staff
Senator Shelley Hughes
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Explained the committee substitute for SB
171.
ROB CARTER, Agronomist
Division of Agriculture
Alaska Department of Natural Resources
Palmer, Alaska
POSITION STATEMENT: Answered questions regarding the committee
substitute for SB 171.
JOAN WILSON, Assistant Attorney General
Commercial, Fair Business, and Child Support Section
Civil Division
Alaska Department of Law
Anchorage, Alaska
POSITION STATEMENT: Answered questions regarding SB 171.
DAVID SCHADE, Director
Division of Agriculture
Alaska Department of Natural Resources
Homer, Alaska
POSITION STATEMENT: Answered questions regarding SB 171.
DUSTIN ELSBERRY, Intern
Senator Joshua Revak
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided an overview of SB 150.
RON SOMERVILLE, representing self
Juneau, Alaska
POSITION STATEMENT: Testified in support of SB 150.
EDDIE GRASSER, Director
Division of Wildlife Conservation
Alaska Department of Fish and Game
Palmer, Alaska
POSITION STATEMENT: Testified in support of SB 150.
JAKE FLETCHER, representing self
Talkeetna, Alaska
POSITION STATEMENT: Testified in support of SB 150.
ROD ARNO, Executive Director
Alaska Outdoor Council
Palmer, Alaska
POSITION STATEMENT: Testified in support of SB 150.
PAUL CLAUS, owner
Ultima Thule Outfitters
Chugiak, Alaska
Wrangell-St. Elias National Park and Preserve, Alaska
POSITION STATEMENT: Testified in support of SB 150.
VIKKI JO KENNEDY, representing self
Kodiak, Alaska
POSITION STATEMENT: Testified in support of SB 150.
SARA LONGAN, Deputy Commissioner
Alaska Department of Natural Resources
Anchorage, Alaska
POSITION STATEMENT: Provided an overview of SB 161 and
participated in a presentation on geothermal resources.
STEVEN MASTERMAN, Director
Division of Geological and Geophysical Surveys
Alaska Department of Natural Resources
Fairbanks, Alaska
POSITION STATEMENT: Participated in the presentation on
geothermal resources related to SB 161.
ACTION NARRATIVE
3:30:56 PM
CHAIR PETER MICCICHE called the Senate Resources Standing
Committee meeting to order at 3:30 p.m. Present at the call to
order were Senators Kiehl, Revak, Bishop, Coghill, Giessel, and
Chair Micciche.
SB 171-INDUSTRIAL HEMP PROGRAM; MANUFACTURING
3:31:52 PM
CHAIR MICCICHE announced that the first order of business would
be SENATE BILL NO. 171, "An Act relating to industrial hemp."
3:32:14 PM
SENATOR COGHILL moved to adopt the committee substitute (CS) for
SB 171, work order 31-LS1431\M, as the working document.
CHAIR MICCICHE objected for purposes of discussion.
3:33:03 PM
SENATOR SHELLEY HUGHES, Alaska State Legislature, Juneau,
Alaska, sponsor of SB 171, stated that the CS makes necessary
changes to keep an opportunity alive for Alaskans based on the
2018 U. S. Farm Bill. The bill will continue the program beyond
October 2020. She added that the Division of Agriculture
supports the bill moving forward.
She said industrial hemp has generated great interest due to the
multitude of hemp-made products that can be produced. She noted
that Lower 48 farmers are experiencing high yields from growing
hemp for oil or fiber use. She said Canada is the world's second
largest producer of hemp with a climate like Alaska's.
She summarized that everyone wants to diversify the state's
economy and SB 171 will pave a way for the industrial hemp
opportunity.
3:35:07 PM
SENATOR BISHOP said he supports the bill, especially after
speaking with Alaska Farm Bureau members regarding the use of
hemp fiber in concrete due to its resiliency to earthquakes.
SENATOR HUGHES said she concurs, especially having experienced
the recent earthquake. She added that oil spill cleanup is
another use for hemp that is particularly relevant to Alaska.
SENATOR GIESSEL said she did not want to throw cold water on
hemp uses, but a civil engineer told her that it is not possible
to make flexible concrete. She added that hemp is an organic
product that would rot. She suggested that the use of hemp in
concrete should not be a selling point.
SENATOR KIEHL noted that the fiscal note strictly reflects fee
registration for every retailer of hemp, cannabidiol (CBD), and
non-marijuana products even though registration is not in the
text of the bill. He asked Senator Hughes if she is comfortable
with the notion of registering, with a fee, every retailer,
whether it be the farm supply store or the people selling hand
cream.
SENATOR HUGHES explained that the Division of Agriculture
brought the registration requirement to her office. She said
Buddy Whitt, her staff member, will address the registration
question. She surmised that retailer registration may be part of
the 2018 Farm Bill.
3:38:16 PM
BUDDY WHITT, Staff, Senator Hughes, Alaska State Legislature,
Juneau, Alaska, explained that the committee and the Division of
Agriculture brought up two major areas of concern during the
first hearing for SB 171. First, how to balance the regulation
requirements in the 2018 Farm Bill, specifically the thresholds
of tetrahydrocannabinol (THC) for hemp. The U.S Department of
Agriculture (USDA) does not allow THC above 0.3 percent.
However, Senate Bill 6 from the 30th Alaska State Legislature
gave growers some grace to correct crops tested above 0.3
percent. The intent of the CS is to find a balance for the
state's industrial hemp program regulations and the USDA
regulations.
He explained that Senator Coghill brought up the second area of
concern of someone having a crop over a certain THC threshold.
He said his CS overview will address Senator Coghill's threshold
concern in finding the right balance working with the division.
He explained the changes in the CS for SB 171 from version A to
version M, "An Act relating to Industrial Hemp,as follows:
• Page 2, lines 30 through 31:
o Goes directly to the retail question.
He said the added language allows the department to
establish regulations to permit manufacturing and retail
sales of hemp and products made from industrial hemp.
• Page 3, lines 25 through 28:
o A new subsection has been added to the bill
that the department "may" develop an
industrial hemp program that complies with
federal requirements.
MR. WHITT said the previous version of the bill stated that
the department "shall" develop that program, the CS added
the "may" language for a specific purpose.
• Page 3, line 29 through page 4, line 4
o The CS removes the repeal of AS 03.05.079,
and instead revises this subsection so that
if someone produces industrial hemp with THC
between .3 percent and 1.0 percent, they may
retain and recondition it.
• Page 4, lines 5 through 7
o A new subsection stating that if a person
retains and fails to recondition, they are
guilty of a violation.
MR. WITT explained that the CS adds a new subsection to
provide a little bit of grace. Someone in good faith can
try to correct their crop. However, if a producer retains
the crop and makes no reconditioning attempt, the producer
is in violation of the statute.
• Page 4, lines 8 through 14
o Revised the definition of Industrial Hemp to
coincide with the federal definition change
in the 2018 Farm Bill.
He said the definition revision matches the 2018 Farm Bill
definition.
3:42:33 PM
• Page 4, Lines 16 through 24
o Conditional language for the effective date
of the repeal of AS 03.05.077.
o The repeal of the pilot program will take
effect once the Industrial Hemp Program,
developed by the department, is approved by
the USDA.
MR. WHITT said the division and the bill sponsor believe in
keeping the pilot program because the only thing USDA program
approval addresses is interstate commerce. The conditional
effective language allows the pilot program to continue until
the USDA responds to the many states, including Alaska, which
are pushing back to allow farmers a grace period for THC
correction.
CHAIR MICCICHE asked Mr. Carter from the Division of Agriculture
if he is comfortable with the definition change and the pilot
project continuing unless the USDA approves the program.
3:45:14 PM
ROB CARTER, Agronomist, Division of Agriculture, Alaska
Department of Natural Resources, Palmer, Alaska, replied that he
is very comfortable with the proposed process. He said he sees
the USDA evolving in regulating the industrial hemp market. The
bill allows Alaska to continue its pilot program during the
interim testing rule process.
CHAIR MICCICHE asked if reconditioning is simply the blending of
a lower proportion of THC from another crop.
MR. CARTER answered yes. He noted that reconditioning is very
standard in other agricultural industries. He detailed that if
an industrial hemp lot tests above 0.3 percent THC and below 1.0
percent THC, the producer can recondition and certify for
commerce with division approval.
3:48:51 PM
SENATOR KIEHL said he did not recall retail registration
language in SB 6. Industrial hemp regulations are different from
other agricultural products, particularly in registering
everybody that sells hemp products.
3:50:31 PM
At ease.
3:50:52 PM
CHAIR MICCICHE called the committee back to order.
3:51:05 PM
JOAN WILSON, Assistant Attorney General, Civil Division,
Commercial, Fair Business, and Child Support Section, Alaska
Department of Law, Anchorage, Alaska, disclosed that she was
involved with SB 6. She said one of the major changes in the
bill happened when the Marijuana Control Board (MCB) decided
that it no longer wanted jurisdiction over CBD and products from
marijuana plants that have 0.3 percent THC or less. The amended
marijuana definition that reflected the MCB decision left the
marketing, retail, and public safety oversite of hemp
unaddressed. The intent of SB 6 was to have the Division of
Agriculture take jurisdiction over the retail sale of hemp and
hemp parts, including such things as the oil.
SENATOR KIEHL asked if the definition of production includes
retail of the finished product. He remarked that requiring
retail registration sounds like funny definition writing when
the state does not require retailers to register for most
finished products. He said his question goes to the sponsor's
intent and desire for the bill, and the industry in Alaska. He
inquired whether the right move is to register and regulate the
ultimate retailer or if the state will be satisfied once a
product is determined to be safe and not psychoactive.
3:53:20 PM
SENATOR HUGHES replied the hemp industry is a new area and she
does not have a problem with including retail registration. She
said she felt comfortable with the Division of Agriculture
having a sense of what is happening regarding retail sales for
consumer safety purposes. She said she is open to the
committee's discussion on concerns.
MS. WILSON pointed out that a number of the entities that will
be producing CBD oil have had absolutely no objection to
registration because they understand that absent MCB
jurisdiction that someone needs to be guaranteeing the safety of
the product. She noted that selling industrial hemp is currently
against the law.
3:55:07 PM
DAVID SCHADE, Director, Division of Agriculture, Alaska
Department of Natural Resources, Homer, Alaska, clarified that
the retail registration allows the division to go in and test
the products. The division has oversite during growing and
processing to make sure the hemp is a good product. However, the
retail provision provides traceability to deal with
manufacturing problems and products not kept in a safe manner.
He said of concern are THC content, pesticides, and heavy
metals. He pointed out that retail registration is a simple
process.
MR. SCHADE said the other key issue is while the federal
government has said that the cannabinoids in industrial hemp are
legal, the product is still a controlled substance and requires
registration. No one can go out and grow industrial hemp and
sell it. Hemp production must be in a program and part of the
division's process. The division has worked hard in carefully
finding the balance with the federal government, he said.
3:57:22 PM
CHAIR MICCICHE asked where the break occurs between industrial
hemp and current hemp sales.
MR. SCHADE answered that except for a few states with permanent
programs, industrial hemp procured outside of the pilot program
is in the black market. He admitted that there are millions of
dollars in product out on the market.
He said Alaska has the unique ability to say if a product
derived from industrial hemp with THC below 1.0 percent and
conditioned below 0.3 percent is legal; part of that product on
a federal level must stay and remain under 0.3 percent.
MR. SCHADE noted that the registration the division designed for
the growing of non-consumption products is very simple.
Registration allows the division to know who has the product and
to make sure that federal and state police agencies do not
consider it to be marijuana. Manufacturing is a little more of a
process to assure product safety, including following Alaska
Department of Environmental Conservation (DEC) food laws.
3:59:20 PM
CHAIR MICCICHE asked if it's correct that many of the gift shops
around the state that are selling black market hemp products
that the state chooses not to enforce.
MR. SCHADE replied there is currently no legal hemp product on
the market.
4:00:29 PM
CHAIR MICCICHE removed his objection to the CS.
4:00:38 PM
He announced that seeing no objection, the CS for SB 171,
version M, is before the committee as the working document.
He noted that public testimony occurred in a previous meeting
and remains open.
He asked Mr. Schade if he had further comments.
MR. SCHADE said he appreciates the committee working with the
division to get clarification on industrial hemp. He stated that
SB 171 is a great compromise bill and is very supportive of
Alaska's hemp industry.
CHAIR MICCICHE asked if anyone wanted to testify on SB 171.
He inquired if Senator Hughes had any final comments on the
bill.
SENATOR HUGHES said her hope is the bill will pass so that the
industrial hemp program can move forward into the coming years.
4:01:53 PM
CHAIR MICCICHE closed public testimony.
4:02:14 PM
SENATOR COGHILL moved to report CSSB 171 (RES) committee with
individual recommendations and attached fiscal note.
4:02:22 PM
CHAIR MICCICHE said there being no objection, CSSB 171(RES)
moved from the Senate Resources Standing Committee.
4:02:33 PM
At ease.
SB 150-INTENSIVE MGMT SURCHARGE/REPEAL TERM DATE
4:04:26 PM
CHAIR MICCICHE announced that the next order of business would
be SENATE BILL NO. 150, "An Act repealing the termination date
for the intensive management hunting license surcharge."
4:04:57 PM
DUSTIN ELSBERRY, Intern, Senator Joshua Revak, Alaska State
Legislature, Juneau, Alaska, said hunting is an essential piece
of Alaskan life and it is of the utmost importance to protect
wildlife for future Alaskans. The state needs wildlife
management to maintain the special connection Alaskans have with
wildlife.
He explained that the moment a moose, caribou or deer population
is determined to be at risk of falling below a sustainable
level, the work of intensive management (IM) begins to identify
the root cause. Enacted action plans using quotas or habitat
management that are based on science and population analysis
ensure sustainable populations.
MR. ELSBERRY said since 2016, the IM program received funds from
a surcharge placed on hunting licenses. However, the surcharge
had a sunset date in 2022. SB 150 repeals the surcharge sunset
date and allows the IM program to be self-sustaining. Prior to
2016, appropriations from the capital budget funded the IM
program. However, the IM program is currently self-funded via
the license surcharge. IM funds leverage federal money through
the Pittman-Robertson Act (P-R Act), a 75/25 formula match where
the 25 percent comes from the state's surcharge funds.
He emphasized that the IM surcharge does not impact true
subsistence hunters or senior hunters, both groups are exempt
from the surcharge.
He summarized that SB 150 ensures that the IM program is
sustainable, protects wildlife populations, promotes food
security across the state, and assures that Alaska's cultures
carry on to future generations.
4:08:02 PM
At ease.
4:09:09 PM
CHAIR MICCICHE called the committee back to order. He said the
committee will first hear from invited testimony.
4:09:30 PM
RON SOMERVILLE, representing self, Juneau, Alaska, testified in
support of SB 150. He detailed that he is a former Alaska
Department of Fish and Game employee, former director for the
Division of Wildlife Conservation, and former chairman for the
Alaska Board of Game. He said his previous duties on the Alaska
Board of Game might help in setting the background on SB 150.
He recalled that the IM law passed in 1994 and the instructions
were clear that the intent was to focus on moose, caribou, and
deer throughout the state.
He emphasized that predator control is not the only form of IM,
funding supports a variety of activities including habitat
manipulation and controlled burning. He admitted that predator
control is necessary in some cases. However, predator control
cannot use P-R Act funds.
MR. SOMERVILLE noted that he also represents Territorial
Sportsmen and the organization supports SB 150.
CHAIR MICCICHE commented that the Kenai Peninsula would like a
break on habitat manipulation due to forest fires that burned
4,000 acres during the last 4 years.
4:14:59 PM
EDDIE GRASSER, Director, Division of Wildlife Conservation,
Alaska Department of Fish and Game, Palmer, Alaska, testified in
support of SB 150. He said the bill is simple and straight
forward where the legislation takes away the sunset clause for
the IM program.
He said the IM law ensures that Alaskans have an opportunity to
feed their families. He added that the department is currently
pursuing an initiative called The Wild Harvest Initiative to
provide food security, especially in rural Alaska.
He said the IM program adds another tool to the department's
toolbelt to create more opportunities for people to feed their
families. The IM program is not just about predator control, the
department does a lot of habitat work as well. For example, the
department purchased a roller-chopper in 2019 for habitat
enhancement projects without using fire. He noted that the
department has not heard from the general public on anything
negative about the IM program.
MR. GRASSER recalled a time when the U.S. Fish and Wildlife
Service used poison baiting for predator control, the department
does not support that drastic measure. The department supports
science-based management of wildlife that maximizes the
opportunities for Alaskans to feed their families.
He detailed that the revenue stream from the IM licensing
surcharge has grown to approximately $1 million per year. The
surcharge is an important revenue stream for research and
surveys on wildlife populations to define objectives to get
people out hunting.
MR. GRASSER said the department feels that based on observations
from other states regarding cost of licenses and tags, most
states charge a tag fee, but Alaska does not charge for tags
other than muskox and brown bear.
MR. GRASSER summarized that the IM license surcharge is an
important revenue stream to the department. They would like to
see the surcharge enshrined in statute and the sunset clause
eliminated.
4:17:40 PM
SENATOR GIESSEL asked if the $1 million annual revenue stream is
from the IM surcharge or the combination with P-R Act funds.
MR. GRASSER answered that the revenue is strictly from the IM
surcharge.
SENATOR KIEHL REFERRED TO a pie chart on IM spending activities.
He asked how much spending occurs on predator control versus
habitat enhancement within the research and management portion.
MR. GRASSER answered that the department receives $4 million
from the IM surcharge with the P-R Act dollars. Most of the work
done to support predator control occurs within survey and
inventory work. The IM law specifies steps in the process to
implement different measures.
He emphasized that survey and inventory work sometimes indicate
clearly that predators are not the limiting factor. Predator
control is one of the limiting factors that the department has
the most control over in its toolbox. However, the department
cannot always have a fire because it might jeopardize a
community. Predator control does not occur until the department
does the survey and inventory work to verify the landscape,
remaining population objectives, and if the harvestable
objectives meet the intent of the IM law.
4:20:09 PM
SENATOR KIEHL referred to a map that showed approximately 90
percent of Alaska land with a positive IM determination. He
asked if the IM management fee just funds what wildlife
conservation is going to need anyway.
MR. GRASSER answered that the IM surcharge funds have specific
goals within the IM statutes. He noted that the department is
currently looking at a $1.7 million deficit for FY 2021 in its
budget. Without the surcharge funding, the department would have
difficulty doing its survey and inventory work.
CHAIR MICCICHE said he has a couple of comments related to
constitutionality. The 1994 IM law connects with Article XIII,
Section 4 in the Alaska Constitution. He paraphrased AS
16.05.255(k):
Alaska's wildlife along with all other renewable
resources shall be utilized, developed, and maintained
on the sustained yield principle. Statutory support as
the achievement and maintenance in perpetuity the
ability to support a high level of human harvest of
game subject to preferences among beneficial uses on
an annual periodic basis.
CHAIR MICCICHE remarked that challenges to the bill would have
occurred if there was a lot of resistance to the IM program in
the past.
4:22:55 PM
CHAIR MICCICHE opened public testimony on SB 150.
4:23:18 PM
JAKE FLETCHER, representing self, Talkeetna, Alaska, testified
in support of SB 150. He said he is a registered guide and a
member of the Alaska Professional Hunters Association (APHA).
Being good land stewards is one of Alaskans' biggest duties and
part of being a steward is using conservation. The bill provides
money so that the department can practice conservation.
4:24:37 PM
ROD ARNO, Executive Director, Alaska Outdoor Council, Palmer,
Alaska, testified in support of SB 150. He explained that the
council and other reputable hunting conservation organizations
got together in 2016 when they realized that the amount of
general funds that were available to the state for their
programs was on the decline.
He emphasized that Alaskan hunters are not looking for a free
ride. The group agreed on raising resident and nonresident fees
to fund wildlife conservation without general funds.
He detailed the following annual hunting license data:
• 65,000 Alaskans buy hunting licenses
• 10,000 nonresidents
• 700-800 aliens
• 3,000 military
• 16,000 low income and 6,000 senior Alaskans who don't
buy a license
MR. ARNO noted that there are some exempt license holders who
continue to buy a license just so that they are contributing to
the fund.
4:27:15 PM
PAUL CLAUS, owner, Ultima Thule Outfitters, Chugiak, Alaska,
testified in support of SB 150. He said the legislation has
already proven itself after three years.
SENATOR BISHOP asked Mr. Grasser for examples of how the fund
has improved habitat.
MR. GRASSER answered that the Division of Wildlife Conservation
has done quite a bit of work in the Tok area with its roller
chopper and various prescribed burns.
CHAIR MICCICHE noted that he drove a chopper tractor when he was
young and asked if the division's roller chopper is similar.
MR. GRASSER answer yes. He detailed that the division's roller
chopper is a trailer that hooks on a Caterpillar bulldozer.
CHAIR MICCICHE commented that the chopper tractor he drove was
self-contained.
4:30:27 PM
CHAIR MICCICHE closed public testimony.
SENATOR KIEHL noted that the legislature uses sunset dates to
ensure program and board review, make sure things are
efficiently following the statutes, and to safeguard from boards
having mission creep. He asked why the bill deletes the sunset
date rather than extending it.
MR. GRASSER answered that the program is well established, and
funding should be continuous. Managing wildlife never stops,
especially to meet harvestable objectives. Managing wildlife is
integral work by the department that requires a consistent
funding stream with certainty.
4:32:10 PM
At ease.
4:32:44 PM
CHAIR MICCICHE called the committee back to order. He asked if
management work would cease if the discontinuation of the IM
surcharge fund collection occurs.
MR. GRASSER answered that management work would not totally
stop, but it would be severely impacted. He said discontinuation
would remove $4 million from the department's budget.
CHAIR MICCICHE asked if similar work would continue but at a
smaller proportion.
MR. GRASSER answered correct.
SENATOR GIESSEL asked if discontinuing the surcharge would leave
$3 million of P-R Act money unutilized by the State of Alaska.
MR. GRASSER answered not necessarily. He explained that
apportionment for the State of Alaska from P-R Act funds has
gone down by $2 million. Instead of $28 million for FY 2020, the
department is looking at $26 million. Discontinuing the
surcharge may have no impact on the department.
4:34:20 PM
CHAIR MICCICHE reopened public testimony.
4:34:47 PM
VIKKI JO KENNEDY, representing self, Kodiak, Alaska, testified
in support of SB 150. She said Alaskans pay for the intensive
management of wildlife through licenses and fees. She emphasized
that the program takes care of itself and puts money back into
it.
4:35:56 PM
CHAIR MICCICHE closed public testimony.
He commented that although the bill repeals the termination
date, the legislature retains the right to repeal the IM program
at any time if things are not working out. In some cases, the
legislature spends a lot of time on extending termination dates
for programs that are known to continue.
SENATOR REVAK, sponsor of SB 150, thanked those that testified,
especially those from communities that wanted to help take care
of the game that they manage regularly.
CHAIR MICCICHE thanked Senator Revak for bringing the
legislation forward.
4:37:09 PM
SENATOR COGHILL moved to report SB 150, work order 31-LS1390\A,
from committee with individual recommendations and forthcoming
fiscal notes.
4:37:24 PM
CHAIR MICCICHE said there being no objection, SB 150 is reported
from the Senate Resources Standing Committee.
4:37:31 PM
At ease.
SB 161-GEOTHERMAL RESOURCES
4:39:18 PM
CHAIR MICCICHE announced that the next order of business would
be SENATE BILL NO. 161, "An Act relating to geothermal
resources; relating to the definition of 'geothermal resources';
and providing for an effective date."
He noted that the committee first heard the bill on February 10.
The Alaska Department of Natural Resources (DNR) has responded
to committee questions and presented a map with the known
statewide geothermal resources and their proximity to population
centers. The committee also requested a presentation on
geothermal resources in Alaska.
4:40:07 PM
SARA LONGAN, Deputy Commissioner, Alaska Department of Natural
Resources, Anchorage, Alaska, thanked the committee for inviting
the department to again discuss SB 161 on geothermal resources.
4:40:50 PM
At ease.
4:44:08 PM
CHAIR MICCICHE called the committee back to order.
MS. LONGAN discussed the following from slide 2 from the DNR
presentation on geothermal resources, Overview, and slide 3,
AGILE Act:
• Slide 2: Overview
o AGILE Act
o Fundamentals of geothermal systems
o Purpose of this bill
o DNR geothermal leasing history
o Sectional summary
o Analysis of selected sections & responses to
questions
• Slide 3: AGILE Act
o Senator Murkowski's Advanced Geothermal
Innovation Leadership Act of 2019 (AGILE Act)
o Authorizes grants and incentives
o Establish a repository for geothermal drill data
o Supports research into Enhanced Geothermal
Systems
o Supports heat pump improvements
o Defines geothermal energy as a renewable energy
source
o Encourages co-production of geothermal with
hydrocarbons and critical minerals
o Improves federal permit coordination
STEVEN MASTERMAN, Director, Division of Geological and
Geophysical Surveys, Alaska Department of Natural Resources,
Fairbanks, Alaska, reviewed the parameters of a geothermal
system on slide 4, Fundamental Ingredients of Useable Geothermal
Energy:
• Elevated geothermal gradient
• Porosity and permeability for the migration of fluids
• Surface access
• Sufficiently large thermal system
• Customers for energy
4:46:39 PM
MR. MASTERMAN discussed slide 5, Heat Flow in Alaska. He
referenced a map and said the illustration provides a broad view
of the amount of energy coming to the earth's surface across
Alaska. He detailed that the red areas on the map indicate more
energy and green areas have less energy. For example, the North
Slope has an area of low heat coming to the earth's surface
where sediments are thick and insulate the surface from heat
beneath. Along the Aleutians and the Alaska Peninsula where
there is a lot of volcanic activity, there's higher heat flow.
MR. MASTERMAN displayed slide 6, North Slope Geothermal
Gradient. He referenced a map and said the illustration shows
geothermal gradients with the degree centigrade per 100 meters
of depth. He noted that the temperature data came from the
bottom of bore holes drilled into North Slope oil and gas fields
by producers. The temperature data allowed the division to
construct maps that show the relative amount of heat that is
coming out of the earth and the rate at which the temperature
increases when going into the earth.
MR. MASTERMAN detailed that the illustration shows most of the
gradients are 3 to 4 degrees centigrade per 100 meters. Going
down 1,000 meters shows the temperature increases by 30 to 50
degrees centigrade. He added that the map provides a rough
estimate of what sufficient temperature data could allow across
the state.
He said Chair Micciche asked in the previous hearing where there
may be undiscovered thermal energy sources. He conceded that the
division does not have the level of information as the North
Slope bore hole temperatures to provide detailed contours across
the rest of the state.
4:48:58 PM
MR. MASTERMAN TURNED TO slide 7, Geothermal Gradients. He
explained that the graph shows examples of geothermal gradients.
The colored band in the graph is a typical geothermal gradient
for Alaska that shows subterranean temperature increases. For
example, the North Slope reaches a temperature of 100 degrees
centigrade at 10,000 feet or 3 kilometers depth.
He pointed out that the graph shows two points of reference, one
of the Chena Hot Springs geothermal system where the temperature
is about 60 degrees centigrade on the surface and about 80
degrees centigrade where the hot water is entering the drill
holes for power production. The second point is the Makushin
system where the temperature is almost 200 degrees centigrade.
MR. MASTERMAN explained that the temperature of a geothermal
system is important for the amount of energy production. Chena
Hot Springs is a cooler system with production of hundreds of
kilowatts of energy. The Makushin system has a higher
temperature system at an energy magnitude of tens of megawatts
of electrical production.
MR. MASTERMAN discussed the following from slide 8, Geothermal
Resource Quality:
• Generation capacity per unit cost depends on several
geologic and economic factors:
o Temperature (hotter is better)
o Flow rate (higher flow rates are better)
o Reservoir Framework (uniform porosity better than
fractures)
o Recharge (partially natural better than all
artificial)
o Depth (shallower is less expensive, thus better)
o Location, location (relative to population,
transmission system, development costs, etc.)
4:52:32 PM
MR. MASTERMAN displayed slide 9, Geothermal Systems. He said the
map on the slide shows the distribution of all known hot springs
across the state as well as the distribution of the active
volcanoes in the state.
He pointed out there is a belt of hot springs across the
interior of the state that are generally associated with cooling
granite bodies. He detailed that hot water in the granite bodies
is in fractures. Accessing hot water requires intersecting the
fractures. The granite bodies are older systems that are cooler
and don't have as high temperature water or productive volumes
as the volcano related system that are present along the Alaska
Peninsula and in the Aleutians.
He pointed out that there are more high temperature systems
along the Aleutians than in the granite related systems. The
volcano related systems have magma close to the surface which is
a hotter material that can generate more and hotter volumes of
hot water.
MR. MASTERMAN displayed slide 10, Alaska's Geothermal Resources
Fairbanks Region:
• Chena
o 80 degrees Celsius at 260 meters
o Reservoir approximately 130 to 145 degrees Celsius
He said slide 10 shows where the hot springs are in relation to
Fairbanks. Chena Hot Springs is close and there are a couple of
others that are fairly close to population centers. The Circle
Hot Springs northeast of Fairbanks is close to Central, Manly
Hot Springs is close to Manly. Those systems are similar in
temperature to Chena Hot Springs with slightly higher water
flows that may be able to produce slightly larger quantities of
electricity. The slide also shows projected reservoir
temperature that is a theoretical value based on the
geochemistry of the water that is coming to the surface. For
example, the evidence for Chena Hot Springs suggests that
drilling deep enough will intersect waters that are somewhere
between 130 and 145 degrees Celsius, temperatures that will
allow for more power generation.
MR. MASTERMAN detailed that the Chena Hot Springs has a 400-
kilowatt capacity. In a 2007 report, they indicated that the
cost of producing power went from $0.30 per kilowatt hour to
$0.05 per kilowatt hour with production from the geothermal
system.
4:55:43 PM
MR. MASTERMAN discussed slide 11, Alaska's Geothermal Resources
Seward Peninsula.
• Pilgrim
o 92 degrees Celsius at 120 meters
o Reservoir approximately 150 degrees Celsius
He said Pilgrim Hot Spring is the most interesting hot spring on
the Seward Peninsula. It has a theoretical power capacity of 4
megawatts of electrical power or about 50 megawatts if using the
energy as heat. He noted that geology will play an essential
role in developing the Pilgrim system because the hot fluids are
coming out of the bedrock and getting into the sands and gravel,
then migrating laterally and coming up to the surface. He noted
that drilling through the sand and gravel right under the hot
springs accesses cooler rock underneath. The system's hot water
source is not known, but that's where geology comes into play.
The system could provide energy to Nome or Graphite One's
potential mine towards Teller.
MR. MASTERMAN displayed slide 12, Alaska's Geothermal Resources
Alaska Peninsula:
• Makushin 190 degrees Celsius at 590 meters.
He explained that the Makushin system is on the same island as
Dutch Harbor and Unalaska. The system could produce power for
the communities' fish processing facilities. There is a group
investigating system development with scenarios calling for
modular generation in 6 megawatt increments with 18 or 24
megawatt plants that could produce power as low as $0.14 per
kilowatt hour, a cost that is competitive with the communities'
current electrical production from diesel fuel.
MR. MASTERMAN noted that there are other systems in the area,
including one in Akutan that could also generate power for their
fish processing facilities. Further to the northeast there are
systems at False Pass, Cold Bay, and King Cove.
4:58:29 PM
MR. MASTERMAN turned to slide 13, Alaska's Geothermal Resources
Southeast Region:
• Estimated reservoirs:
o Goddard - 140 degrees Celsius
o Baranof - 95 degrees Celsius
o Bailey Bay - 150 degrees Celsius
o Tenakee - 65-100 degrees Celsius
He said there are a number of hot springs in Southeast Alaska
that are of potential interest. Two that are most well situated
are the ones investigated for producing power near Sitka, the
Goddard and Baranof hot springs. The granite-related systems are
fracture based and nonvolcanic. The systems along the Aleutians
have an added advantage of being in volcanic rocks that are
sometimes quite a lot more porous and permeable and can make
better reservoirs and produce higher volumes of water for more
power.
MR. MASTERMAN reviewed slide 14, Key Points:
• Geothermal heat, where technically and economically
accessible, is an excellent form of sustainable energy.
• Hydrothermal systems are the most common form of energy
extraction from geothermal heat.
• Complex geologic parameters necessary for a viable
geothermal resource, all present at one location, is rare.
• Alaska contains several potential geothermal resources.
• New technologies that will help expand geothermal
development into less favorable geology are on the horizon.
5:01:42 PM
CHAIR MICCICHE asked the presenters to finish the presentation
at the next committee meeting, due to time constraints.
MS. LONGAN replied the department will accommodate the
committee's schedule.
[SB 161 was held in committee.]
SB 155-EXPLORATION & MINING RIGHTS; ANNUAL LABOR
5:02:18 PM
CHAIR MICCICHE announced that the final order of business would
be SPONSOR SUBSTITUTE FOR SENATE BILL NO. 155, "An Act relating
to exploration and mining rights; relating to annual labor
requirements with respect to mining claims and related leases;
relating to statements of annual labor; defining 'labor'; and
providing for an effective date."
He said the committee heard the original bill twice and received
a presentation on the committee substitute, version G, during
the third hearing. Finding no questions, he solicited a motion.
5:02:43 PM
SENATOR COGHILL moved to report CSSSSB 155, work order 31-
LS1278\G from committee with individual recommendations and
attached fiscal note.
5:03:02 PM
CHAIR MICCICHE found no objection and CSSSSB 155(RES) moved from
the Senate Resources Standing Committee.
5:03:27 PM
At ease.
5:03:34 PM
CHAIR MICCICHE called the committee back to order.
5:03:41 PM
There being no further business to come before the committee,
Chair Micciche adjourned the Senate Resources Standing Committee
meeting at 5:03 p.m.