Legislature(2009 - 2010)BARNES 124
02/11/2010 03:00 PM House ENERGY
| Audio | Topic |
|---|---|
| Start | |
| HB305 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 305 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 305-OMNIBUS ENERGY BILL
3:23:13 PM
CO-CHAIR EDGMON announced that further testimony would be heard from
representatives of the Alaska Federation of Natives (AFN) on HOUSE
BILL NO. 305, "An Act relating to energy; relating to the board of
directors of the Alaska Energy Authority; amending the size and
composition of the board of directors of the Alaska Energy Authority
by removing the members of the Alaska Industrial Development and
Export Authority as directors of the Alaska Energy Authority and
providing for designation or appointment of other members; amending
the quorum requirement for the board of directors of the Alaska Energy
Authority; and relating to nuclear waste material."
3:24:12 PM
CO-CHAIR EDGMON thanked AFN for hosting a House Special Committee on
Energy meeting at its convention in Anchorage. He then displayed a
slide that summarized aspects of HB 305-Omnibus Energy Bill. Co-Chair
Edgmon also announced the upcoming round table discussion scheduled
for 2/18/10.
3:26:59 PM
CO-CHAIR MILLETT welcomed the representatives from AFN spoke of the
value of the committee meeting held during the AFN convention. She
told them "your voice is strong". She said the committee wanted their
help with many issues, not just energy. She thanked Speaker Chenault
for his support of the committee's travels during interim and session.
3:28:15 PM
REPRESENTATIVE CHENAULT stated the importance of traveling across the
state to highlight the issue with energy. He expressed his hope that
energy does not become a factor between rural and urban Alaska.
Lastly, he thanked the communities that hosted the committee and the
committee members for their hard work.
3:29:38 PM
RALPH ANDERSEN, CEO, Bristol Bay Native Association (BBNA); Co-Chair,
Human Resources Committee, AFN; Chairman, Energy Working Group, AFN,
thanked the committee for its visit to Dillingham and for the
opportunity to testify. Mr. Andersen informed the committee that he
served on the stakeholder group that worked on the bill last summer,
and recalled that the co-chairs brought a diverse group together to
work towards consensus on a draft energy bill. Mr. Andersen pointed
out that the high cost of energy for electricity, gas, diesel, or home
heating fuel has the biggest impact on the lives of everyone across
the state. Although he was encouraged by the legislature's efforts to
plan for the state, Alaska's future is tied to the availability of
affordable energy resources throughout Alaska. His organizations
support the fundamentals of a state energy policy that promotes
affordable energy, energy efficiency, conservation, and the
development of renewable and nonrenewable energy sources. The AFN
also supports a policy that promotes economic development, energy
research, education, and workforce development. Mr. Andersen stated
that these policy goals will guide development and implementation of a
successful energy plan. He supported the following steps: (1)
declaring an energy policy; (2) establishing a department of energy;
(3) following an energy plan with clear, immediate short-, mid-, and
long-term goals for programs and infrastructure, and that recognizes
that assistance is needed for some; (4) following a clear schedule
for the implementation of energy programs and projects. Regarding the
nine bills included in HB 305, he offered the following comments: (1)
energy efficiency standards for public buildings are needed; (2)
revival of the alternative energy revolving loan fund is needed; (3) a
state department of energy is crucial; (4) funding of the renewable
energy grant fund is necessary; (5) renewable energy tax credits are a
good idea; (6) an energy use index database is supported; (7) an
emerging energy technology fund can benefit Alaskans. Furthermore, he
expressed his support for the Senate companion omnibus bill that
offers a possible solution to the economies of scale regarding fuel
deliveries in rural Alaska, and for continued funding of Alaska
Housing Finance Corporation's (AHFC) weatherization program. Finally,
he encouraged the continued full funding of the Power Cost
Equalization (PCE) program that makes a difference for families in
rural Alaska. He gave a personal example of the benefit of PCE. Mr.
Andersen concluded that HB 305 raises the hopes and expectations of
rural communities that there may be a solution to the high cost of
energy.
3:40:17 PM
JULIE KITKA, President, AFN, commended the committee for its work
toward the omnibus energy bill. She opined affordable, clean,
alternative, and renewable energy, as well as developing resources, is
critically important to Alaska's communities. Furthermore, as an
energy state, it is important that the residents of Alaska can heat
their homes. This bill will address multiple aspects of the goals of
clean and affordable energy and of upgrading the delivery systems in
communities. Ms. Kitka explained that she is a commissioner in the
Denali Commission and one of its first fundings was to bring bulk fuel
storage in rural areas up to Environmental Protection Agency (EPA) and
Coast Guard compliance. During that process, the Denali Commission
concluded that it did not want diesel fuel to be the only option
available, although it was the most affordable. She expressed her
hope that the present technology will put access to other options
within our reach. Ms. Kitka stressed that state investment in new
technologies is investment in the future. In fact, investing in
energy alternatives and ideas is building the future and is no
different than building schools, hospitals, clinics, and technology
infrastructure. She observed that energy "is life and death for our
people in our communities," and for residents to choose between heat
and food is unacceptable. She noted that the omnibus bill includes
the various aspects of the aforementioned, and she encouraged the
committee to go forward and invest sizable resources into the
infrastructure of communities. Furthermore, affordable energy is the
key to economic development and sustainable communities. She informed
the committee that the AFN board consists of 37 members made up of the
presidents or CEOs of the regional Alaska Native Claims Settlement Act
(ANCSA) corporations, heads of the regional tribal consortiums, and 12
elected village representatives. AFN membership includes nearly 200
villages and is the largest umbrella organization in the Native
community. Energy is one of AFN's top priorities; in fact, its energy
working group is pledged to work with the House Special Committee on
Energy.
3:45:33 PM
MR. ANDERSEN, in response to Co-Chair Edgmon, expressed his belief
that the AFN energy working group is addressing two types of issues:
policy issues such as legislation, and recommending changes in
existing policy. One of its recommended changes was addressed by the
Palin Administration, during the period of high fuel prices, by
providing additional funds for family assistance and the early
distribution of the Permanent Fund Dividend (PFD). Since the energy
working group was formed, there are various projects occurring such as
wind generation, and the development of alternative energy sources; in
fact, the energy committee saw some of these projects during their
visit. The work at the AFN level continues to be advocating for
policy and at the regional level it is participating in policy
development and recommendations, and the implementation of projects to
bring down energy costs.
3:48:09 PM
MS. KITKA observed that AFN has also recognized its responsibility to
contribute the country by modeling innovation. She has heard that the
Pacific Northwest will need sources of energy from Alaska; thus, after
taking care of the home front and communities, Alaska will need to
contribute to the rest of the nation, particularly after the decline
of oil from the Trans-Alaska Pipeline System (TAPS).
3:49:27 PM
CO-CHAIR EDGMON said that the bill purports to create two new funding
sources: (1) a loan fund for emerging technologies; (2) smaller scale
loan programs geared to individual, or household, renewable projects.
He asked whether AFN has sources of federal funds that might be
available to compliment the state programs.
3:50:20 PM
MS. KITKA offered to provide the committee with information on sources
of federal funds. She suggested that the committee consider how
Alaska can become a catalyst for private sector investment in energy
development. For example, a private entity made contributing to the
national dialog on how to create alternative energy resources for
technology, a priority. In this way, the state can put in place
incentives to attract private sector partnerships. Furthermore,
resources put into the University of Alaska (UA) can put the
university on the cutting edge of energy development for emerging
technologies. However, she cautioned that Alaska's villages and
communities must be taken care of first.
3:52:15 PM
MR. ANDERSEN observed that the federal government has departments that
have established, for the first time, tribal offices and Native
American divisions within them; for example, the Department of
Commerce (DOC) and the Department of Energy (DOE). The DOE offers
tribal organizations competitive energy grants that were inspired by
the current economic crisis; in fact, there are reservations in other
states in dire need of assistance. Thus Alaska is competing with all
of the tribal interests in other states. Mr. Andersen recalled that
DOE representatives in Washington, D.C., are concerned about how
Alaska, with all of its oil revenue, is contributing to improving the
cost of living in Native villages.
3:54:51 PM
MS. KITKA pointed out that when state resources are offered as
matching funds, more federal resources are attracted, particularly for
innovative programs.
REPRESENTATIVE JOHANSEN reiterated that the AFN goal is for
sustainable communities with economic development and activity, and
the underlying "first step" is to take care of the energy problem.
3:56:30 PM
MS. KITKA said yes; for example, a business shipping fish from Bristol
Bay cannot exist if energy costs are too high to run the cold storage.
REPRESENTATIVE JOHANSEN asked whether the cost of energy is the top
limiting factor for AFN members.
3:57:31 PM
MS. KITKA explained that communities have multiple needs, such as
access to good education and a health care system and clinics, but
affordable energy is essential for survival.
REPRESENTATIVE RAMRAS asked for a corporeal example of the cost of
electricity for Christmas lights, after the PCE calculation.
3:59:16 PM
MR. ANDERSEN responded that his normal electric bill is between $250
and $300 per month for a three bedroom house with PCE.
REPRESENTATIVE RAMRAS said his constituents pay over $200 per month
for electricity without PCE.
4:00:00 PM
CO-CHAIR EDGMON advised that in "small village Alaska" the cost
doubles, or more, and has a cumulative effect.
MR. ANDERSEN noted that some villages are taking action independently;
for example, Perryville has installed an array of ten wind generators.
He opined a state energy department would help coordinate the efforts
that are being made, and prevent state government from being "all over
the place."
4:03:19 PM
REPRESENTATIVE RAMRAS has heard that placement of the Division of
Agriculture in the Department of Natural Resources (DNR) is not a
benefit, because the division is ignored. Therefore, the existence of
a commissioner of energy does not ensure that specific needs are
better met, even though the intention is excellent.
MS. KITKA recalled a visit by the Secretary of Energy and expects more
opportunity for collaboration between the state and the federal
government. Secretary Chu has created a climate of innovative ideas
on the national level.
4:05:08 PM
CO-CHAIR MILLETT noticed innovation taking place in every community
the committee visited last year. She saw the displacement of diesel
fuel by energy generated by wind farms and high efficiency wood
stoves; in fact, rural Alaska is doing a lot and should be supported
by the coordination of government programs, such as the Denali
Commission, the DOE, and the state.
REPRESENTATIVE TUCK added that the other needs of villages would be
better served with the reduction in energy costs.
4:07:20 PM
REPRESENTATIVE RAMRAS asked what message AFN heard from state
officials such as Steve Haagenson, Gene Therriault, and Joe Balash,
who have been specifically tasked with urban and rural energy issues.
MS. KITKA said AFN has met with them in the past.
MR. ANDERSEN said that the governor's energy person was not present at
today's AFN meeting.
4:09:03 PM
REPRESENTATIVE RAMRAS asked whether this was a missed opportunity.
4:09:27 PM
MS. KITKA said improving the legislation was an ongoing process.
CO-CHAIR EDGMON thanked Ms. Kitka and Mr. Andersen
MS. KITKA concluded that this a good time to make progress,
particularly on the federal level.
4:10:34 PM
LORETTA BULLARD, President, Kawerak, Inc., informed the committee her
organization is the regional tribal non-profit consortium for 16
communities in the Bering Straits region. She expressed Kawerak's
welcome of HB 305, especially in view of the situation last winter
when its members were paying from $5 to $8 per gallon for heating
fuel. Furthermore, a number of businesses, public facilities, and
offices without access to PCE, were paying in excess of $1 per kWh of
electricity. Ms. Bullard gave an example of the cost of utilities for
commercial users. She encouraged the creation of a state clearing
house to advise villages and residents on energy products and systems
to prevent purchases of the wrong technology, and cautioned that
mistakes are being made. She advised that the weatherization of homes
is really needed; unfortunately, AHFC's program is not taken advantage
of by those living in the Bush. For example, in Nome there are only
one or two auditors, and there are 60 or 70 homes waiting to be
audited. Also, the pre-audit, post-audit, forward funding of
materials, and the shortage of contractors, are all barriers to the
program at the village level. Her suggestion was to have a regional
non-profit or housing authority do the audits, order the materials,
and arrange for the labor to take the onus off of individuals.
Responding to the question of what village residents are doing about
the high cost of energy, she relayed that the Norton Sound Economic
Development Corporation (NSEDC) donated $1 million to each village in
its region, to assist with the development of alternative energy
resources. A state or federal match to these funds would help get
projects started that will offset the need for diesel fuel in
villages.
4:16:05 PM
CO-CHAIR MILLETT asked whether the local housing authorities can
accept funds from AHFC and hold the money until the work is done.
4:16:28 PM
MS. BULLARD assumed so; in fact, housing authorities have access to
money in certain circumstances.
REPRESENTATIVE PETERSEN heard in previous testimony that some areas of
the state have success with the weatherization program, and other
areas have little participation. He suggested that the committee get
information from the successful areas and provide it to others.
MS. BULLARD opined the lack of energy auditors is a large part of the
problem.
4:17:51 PM
CO-CHAIR EDGMON announced that AHFC will return to the committee after
its regional analysis is completed, and provide a better understanding
of the programs.
4:18:39 PM
MS. BULLARD encouraged the creation of a state energy plan that puts
alternative energy, and the alleviation of Alaska's dependence on
diesel fuel, at the forefront in the long term.
4:19:45 PM
JOE CHYTHLOOK, Chairman, Board of Directors, Bristol Bay Native
Corporation (BBNC); board member, AFN, said after a long absence he
has heard from village residents about problems that are not new. He
told a story about Yup'ik elders. Mr. Chythlook opined that rural
villages have similar problems when it comes to energy, and he is
hoping that those who do not live in the Bush will understand the
extent to which energy costs have risen. He recalled that gasoline
cost $.32 to $.40 cents per gallon in 1964. Now, diesel costs close
to $4 per gallon and in Dillingham it costs $6 per gallon. Mr.
Chythlook recently retired from the Alaska Department of Fish & Game
(ADFG), and he said he would be hard pressed to survive on his
retirement during the winter.
4:25:07 PM
MR. CHYTHLOOK explained that energy issues in Alaska are fractured and
even in Bristol Bay there is not an area wide system; in fact, at a
village 17 miles west of Dillingham, the cost of electricity is double
the cost in Dillingham. A significant problem is that fuel is
delivered twice per year and the price is set at the delivery,
although fuel prices may go down during the months that follow. Mr.
Chythlook assured the committee that organizations in Bristol Bay are
planning to address energy and economic problems. He expressed his
hope that the bill will be successful for the residents that do not
live on the road system.
4:30:17 PM
REPRESENTATIVE RAMRAS recalled that Denali Bio-Diesel, a company that
converts fish parts to gasoline, targeted the Dillingham community for
a pilot program. He asked how many people lived in Dillingham and the
surrounding area.
MR. CHYTHLOOK estimated that 4,500 people are BBNC shareholders in the
Dillingham area and the shareholder base is 8,400 people. He agreed
with Mr. Andersen that during shareholder meetings the main topic of
discussion for the last several years has been energy. Throughout
Western Alaska only diesel fuel is available for heating.
4:41:00 PM
THOMAS TILDEN, Representative, Curyung Tribe, thanked the committee
for visiting Dillingham and putting testimony from Dillingham
residents into action. He encouraged the committee to move the bill
forward. He informed the committee that his tribe takes energy very
seriously and has formed a committee that is putting energy efficiency
tips in the newspapers to educate residents. Mr. Tilden stressed the
need for all public facilities to be energy efficient, in addition to
schools. Another matter in Western Alaska is the need to address the
transport and delivery companies to find the reason behind the
difference in transportation costs. He heard that deliveries to water
locations can be cheaper due to the regulations that drive up the cost
for deliveries on land.
4:47:52 PM
CO-CHAIR EDGMON thanked the participants and requested written
comments.
4:48:20 PM
[Although not formally announced, HB 305 was held.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB305 Sectional.pdf |
HENE 2/11/2010 3:00:00 PM |
HB 305 |
| HB0305A.pdf |
HENE 2/11/2010 3:00:00 PM |
HB 305 |
| HB 305 Sponsor Statement.pdf |
HENE 2/11/2010 3:00:00 PM |
HB 305 |