Legislature(2023 - 2024)ADAMS 519
04/26/2024 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB174 | |
| HB169 | |
| HB232 | |
| HB260 | |
| HB368 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 260 | TELECONFERENCED | |
| += | HB 368 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 174 | TELECONFERENCED | |
| += | HB 169 | TELECONFERENCED | |
| + | HB 232 | TELECONFERENCED | |
HOUSE BILL NO. 368
"An Act relating to clean energy standards and a clean
energy transferable tax credit; and providing for an
effective date."
Co-Chair Foster invited the bill sponsor and staff to the
table. He asked for a brief recap of the bill.
6:06:43 PM
Representative Rauscher thanked the committee for hearing
the bill. He remarked that the bill was critical in
addressing a pressing economic and strategic issue facing
the state. He discussed that the reserves of economically
recoverable natural gas in Cook Inlet were dwindling. He
stated it was not only an environmental issue, but a matter
of economic security and energy independence for Alaska.
The bill was about preparing the state for the future,
ensuring it was not caught off guard as energy landscapes
evolved. He noted there were currently multiple pieces of
legislation focusing on various angles of the issue to
address different parts of the solution. He stated that HB
368 was one part of the solution. The bill proposed a
strategic shift toward diversifying the state's energy
sources. He detailed that it was about making practical
investments in technologies that could sustain Alaska's
energy needs for the long-term including hydrogen, coal,
micronuclear energy, wind, and solar. He wanted to focus on
how the bill could bolster the state's economy and energy
autonomy, reduce reliance on single sources, and keep
Alaska's robust and competitive on the national stage. He
highlighted that it was about prudent planning and ensuring
a stable, prosperous future for all Alaskans. He thanked
the committee and asked to hear from his staff.
6:09:23 PM
CRAIG VALDEZ, STAFF, REPRESENTATIVE GEORGE RAUSCHER,
explained that the bill would create a clean energy
portfolio standard, setting benchmarks for the amount of
clean energy and the definitions of the energy, for
increased amounts on the Railbelt. The bill would add clean
energy transferrable tax credits, an incentive to build and
produce clean energy to offset dwindling natural gas
supplies. The bill would add statutory language for net
billing as well as definitions.
Co-Chair Foster asked to hear from Ian Walsh with
Legislative Legal Services regarding his legal memorandum.
6:10:31 PM
IAN WALSH, LEGISLATIVE COUNSEL, LEGISLATIVE LEGAL SERVICES
(via teleconference), went through the legal memo dated
April 24, 2024 (copy on file) that explained one possible
issue Legislative Legal Services had identified with the
legislation. He explained that the issue pertained to the
Alaska Constitution's restrictions on enacting local and
special legislation. The constitution specified that "the
legislature shall pass no local or special act if a general
act can be made applicable." He stated that many of the
bill's provisions focused on the Railbelt and some focused
on particular areas of the Railbelt such as the Copper
Valley Electric Association. He elaborated that the bill
may be considered special legislation; therefore, it would
be important for the bill to survive constitutional
scrutiny to ensure that the legislative record showed there
was a fair and substantial relationship to the
classifications established by the legislation.
Representative Ortiz asked Mr. Walsh to further explain his
last statement in simpler terms.
Mr. Walsh replied that it was difficult to provide simpler
language for the test that had been established for the
constitutional provision. He explained that the special
aspect of the legislation had to have relationship to
legitimate purposes. He elaborated that if the legislature
could show why there needed to be a special aspect of the
act and that a more general act could not be made
applicable under the circumstances, the bill could survive
the constitutional scrutiny.
Co-Chair Foster stated his understanding of the explanation
with an example. He detailed that if the bill specified
that the tax credits were available to the Railbelt or for
Homer it would be seen as being too specific. He stated his
understanding that the laws should be more like "these tax
credits are available to the entire state or populations
under 5,000 or something" instead of being something
specific to Homer for example.
Mr. Valdez agreed with the explanation provided by Co-Chair
Foster. He relayed that the bill's language was built for
any existing ERO [Electric Reliability Organization]. There
was currently only one ERO, but the original statutory
language written several years ago allowed for any one
organization to be created in any part of the state. He
reiterated that there was currently only one ERO, which may
change in the future. He noted it was broadly applicable at
present.
6:14:07 PM
Representative Stapp directed a question to Mr. Walsh. He
thought the legislature did that all of the time already.
He elaborated that there were rules about taxation on the
North Slope, Middle Earth, and Cook Inlet, which were all
geographic regions. He added that the Alaska Marine Highway
System (AMHS) did not go to Nome in the summer. He asked
Mr. Walsh to provide clarification.
Mr. Walsh responded that it was not a prohibition on
enacting local and special legislation, just a restriction.
Under the circumstances, there were likely very good
reasons why a more general act or more general provisions
could not be made applicable. He stated that without
knowing more detail he could not be sure, but presumably
the way those programs were implemented would provide
constitutional scrutiny.
Representative Stapp asked for the difference between
restricted and prohibited. He viewed the words as meaning
the same thing.
Mr. Walsh answered that it was not an all-out prohibition
on local and special legislation, the constitutional
language (Article 2 Section 19) required that a local and
special act could not be enacted if a general act could be
made applicable.
Co-Chair Foster recognized Representative Jesse Sumner in
the room.
Representative Ortiz noted that HB 307 had been heard the
previous day and included the word "Railbelt" numerous
times throughout the bill. He did not understand why the
committee did not receive the same legal warning for HB
307. He asked what made HB 368 different.
Mr. Walsh agreed that there were many bills including HB
307 that dealt with specific geographic areas of the state.
The constitutional provision applied to any legislation
that the legislature might pass. The reason he had written
the legal memo to HB 368 in particular was because some of
the provisions in the bill focused on the service area of
the Copper Valley Electric Association so it may not be
considered a statewide application. He stated it was a bit
challenging to give firm conclusions under the provision
and circumstance.
Co-Chair Foster asked if the legal memo had arisen because
the question had been posed by someone on the committee. He
asked his staff to respond.
6:17:43 PM
BRODIE ANDERSON, STAFF, REPRESENTATIVE NEAL FOSTER,
responded that a request had been made by committee members
in response to the plethora of energy legislation coming
before the committee in the past two weeks. He relayed
there had been questions about some of the legal
applications in regard to how the bills interacted with one
another. A request had been made for the committee to
request any legal memos that may have come up during
conversations in prior committees and/or would accompany
bills coming to the House Finance Committee. He had put out
a blanket request that if there were any issues raised or
possibly could be raised for all of the energy bills that
they should be submitted to the co-chair's office.
Co-Chair Foster reiterated Mr. Anderson's statement that
the memo was a blanket [request] because it applied to a
couple of other bills as well. He viewed the issue as
Legislative Legal advising the committee to keep the issue
in mind, but he did not hear them saying, "this is an
issue."
Representative Hannan directed a question to Mr. Walsh.
She was trying to find the specific places in HB 368 that
raised the concern. She looked at the reference to the
Railbelt service area and Copper River Valley Association
on page 4, lines 27 and 28. She did not see another
reference until page 9 where Railbelt was defined as Kenai
to the Interior. She asked if there were other references
in the bill that Mr. Walsh believed contributed to the
concern.
Mr. Walsh responded that he believed the instances
highlighted by Representative Hannan were the only
occurrences he was aware of that would contribute to the
concern. He agreed with Co-Chair Foster that it was a
possible issue to take into consideration, but not
something that would prevent the legislature from passing
the legislation. He stated that the memo was mostly a
suggestion that the record should be sufficient to justify
the focus on the local issues.
Co-Chair Foster asked to hear from two invited testifiers.
6:20:49 PM
JULIE ESTEY, CHIEF STRATEGY OFFICER, MATANUSKA ELECTRIC
ASSOCIATION, PALMER (via teleconference), stated that
Alaska was at a critical point in energy with uncertainty
in the natural gas supply. On the plus side, there were new
innovative power options that were available currently or
on the horizon. She listed energy sources such as nuclear,
energy storage, and new ways of making old generation such
as coal and gas more efficient. Additionally, renewable
energy, which had struggled to be competitive in the past,
was currently able to compete more closely with some of the
projected fuel costs. There was also a large amount of
federal funding available, which cut the cost in half for
[Matanuska Electric Association (MEA)] members. She shared
that the association had members asking it to be more
innovative in its energy solutions by looking beyond
traditional supplies and to look for ways to make the
existing gas supply last longer. She stated that luckily
Alaska had a governor and legislature that were invested
and motivated in making changes to allow the state to grow
into a new energy future.
Ms. Estey stated that as MEA looked towards the new energy
future, it realized there were many options on the table.
She explained that almost all of the options had benefits,
costs, and tradeoffs. She elaborated that MEA was actively
working on solutions with gas through the gas working
group, collaborative projects with other utilities, and on
its own efforts. She stated that individual utilities could
not and should not go alone. She expounded that gone was
the luxury of just thinking about its own ratepayers and
service territories. The association was now accountable to
the system, region, and the rest of the state.
Ms. Estey shared that MEA appreciated the governor's
leadership in forming the energy taskforce, which she had
spoken about the previous day. There were three primary
recommendations including the transmission unification,
growing load, and to diversify generation. She elaborated
that it included looking at innovation opportunities and
the gas supplies, energy security and resilience, and
keeping energy costs competitive. The first action listed
under the strategy in the report was to develop a clean
energy standard with incentives instead of penalties. The
recommendation was made after meetings and the public
process and for input from the National Renewable Energy
Lab indicating that cooperatives be opted out of any
penalties. She relayed that two legislators, Senator Click
Bishop and Representative George Rauscher, were on the
taskforce. She appreciated that the two legislators had
asked how to realize the recommendations. She highlighted
that SB 257 had come out of the Senate Resources Committee
[2024 legislation pertaining to electric utility
regulation]. She relayed that MEA appreciated
Representative Rauscher's sponsorship of HB 368 to make
some of the concepts and recommendations actionable.
Ms. Estey relayed that MEA had established its own goal of
50 percent clean energy by 2050. The association viewed it
as a realistic goal and aspirational stretch to the
limitations of the existing electric system, rate making
realities, current regulatory and permitting environments,
Alaska's harsh environmental, and lessons learned from
other countries and states that did too much too soon
without fully understanding the unintended consequences.
The association appreciated that HB 368 aligned with MEA's
target.
Ms. Estey shared that MEA appreciated the bill's reachable
goals. She detailed that if the goal was good policy, it
should be a catalyst for change and should not set up the
industry to fail. She elaborated that many states and
countries started with modest goals and increased as
lessons were learned, and trust was gained. She relayed
that many states had some sort of renewable portfolio
standard, clean energy portfolio standard, or carbon
reduction goals, many were far less aggressive than "this
one," although some were more aggressive. The association
also appreciated the key role transmission played. She
shared that the state's constrained system was a limiting
factor. She explained that progress could be made with the
constrained system, but it was limited. She detailed that
MEA had the opportunity to lower cost and risk to members
through economies of scale of sharing projects between
utilities. Transmission improvements would be necessary to
achieve big goals without incurring costs or relying on
unproven technology.
Ms. Estey relayed that MEA appreciated provisions that
counted progress in the standard and the ability to waive
requirements if MEA was doing its best, but things were not
working out. She stated that even the best projects
experience delays. One of the association's favorite
projects on the system was the Houston project, the largest
utility scale solar project. She detailed there had been
very willing participants and MEA was excited to work with
the developers. There were great financing teams, the
borough leased the land to the project, and MEA got a
contract through to the Regulatory Commission of Alaska
(RCA). She noted that world events and financing and supply
chain issues had slowed progress; therefore, the project
took longer than anticipated. She added that projects would
not all run into those delays, but it was an example that
there should be acknowledgement of progress even if there
was something beyond control. She stated HB 368 allowed for
that. Additionally, the bill allowed for a calculation for
net metering energy. She described net metering energy as
rooftop solar or individual homes with small wind turbines.
Ms. Estey highlighted that MEA supported member choice and
believed distributed energy systems could be a component of
meeting future energy needs. She stated it allowed for a
provision to consider a guesstimate of the total fuel
offset rather than what came back through the meter. She
detailed that it was an acknowledgement that even though
someone may only sell a portion of the power back to the
utility, it was offsetting a great deal more gas on their
side of the meter. She stated that MEA appreciated the
provisions in the bill that allowed that to happen. The
provisions also allowed for energy efficiency, which was
key. She stated that the cheapest fuel was the fuel that
did not have to be burned. She remarked that energy
conservation efforts to reduce consumer demand or the
amount burned through efficient generation should be
reinforced. The bill reinforced collaboration among the
utilities to achieve goals. True to the taskforce
recommendation, the bill included incentives in the form of
tax credit to incentivize change and help with project
economics. The bill also included a provision for net
billing. She detailed that it allowed the RCA to vary the
rates MEA could pay back to members based on how helpful
the energy was at any given time. She explained that it
decreased the potential for cross subsidization between the
haves and the have-nots. Additionally, it made room for
other technologies. She stated that MEA's diversification
goals included an "all of the above" approach. She
highlighted that MEA was working with Golden Valley
Electric Association (GVEA) on a wind project and it was
also coordinating with the association on possibly using
coal. She relayed that when MEA surveyed its members,
typically 65 to 75 percent responded they wanted to see
more power with clean energy, but cost and reliability were
consistently listed as the top priority.
6:30:35 PM
Ms. Estey continued that all of the options needed to be
left on the table to meet growing power needs despite the
uncertainty of Cook Inlet gas supply in the small
vulnerable grid. The association believed the bill allowed
for a full complement of fossil fuel, thermal based
generation sources, and clean energy. The bill provided
MEA's board with general state direction balanced with
local control and flexibility to make the best choice for
members.
Ms. Estey received two primary questions about the bill.
The first was about coal being in a clean energy bill. She
agreed it was creative and MEA had not seen it in another
clean energy bill. She also believed it was recognition
that "these are crazy times." She stated it was nice to
have all options on the table. She remarked on a
consideration of importing LNG in a resource rich state.
She remarked that mine mouth coal likely had a lower
environmental footprint than importing LNG, likely at a
lower cost, and at lower risk. She added that it would keep
money in the Alaskan economy. She reiterated that MEA
wanted all options on the table. She stated it was not the
right time to label energy as good or bad.
Ms. Estey stated that the second question she received was
whether the bill was necessary. She viewed it as solving an
old problem in some ways. She elaborated that up until very
recently clean energy was a nice thing to have and people
believed the utilities were not moving fast enough. She
relayed that with the recent announcement by Hilcorp and
the uncertainty around natural gas, it brought market
forces to play to solve the problem that often moved the
needle much faster than policy: scarcity and price
sensitivity. The association agreed with Chris Rose that
alternate forms of energy including renewables and other
clean energy could start competing with traditional fossil
fuel options at the projected fuel prices. The association
also agreed that scarcity and price sensitivity would allow
economics in the free market to naturally drive a more
diverse energy portfolio.
Ms. Estey relayed that MEA also understood there was a
benefit in the legislature and governor setting a standard
to give clear directions, certainty, and market signals.
She stated it could provide direction to the RCA and co-op
board to make bold moves toward the common vision of an
energy transition. She communicated that MEA believed the
bill contained a common sense clean energy standard that
was pragmatic, aspirational, and flexible. The association
believed it could act as a catalyst for energy transition
for diversification and stabilization of cost. She
communicated that reliability was key and keeping the
lights on was essential. The association could not support
any legislation that jeopardized its certificated
responsibility and commitment to its members. The
association believed the bill took those things into
account. She concluded that while other voices were
critical to the process and developing solutions, it would
be the MEA board and the legislature who would be
accountable for the success or failure of the energy
transition going forward. The association appreciated being
part of the solution.
6:34:49 PM
Representative Hannan asked about MEA's energy goal by
2050. She asked Ms. Estey if the 50 percent goal was for
renewable or clean energy.
Ms. Estey responded that it was clean energy. She noted
that the MEA board did not define the term.
Representative Hannan in the bill under clean energy could
include gas, oil, nuclear, or coal as long as it involved
sequestering an equal amount to producing. She asked if
those options had been discussed by the MEA board and were
included in its goal.
Ms. Estey answered that the MEA board did not provide
specific direction on the specific technology. She stated
it was a future conversation MEA was hoping to have once
there was a better picture of the diversification options
on the table. She elaborated that MEA staff was taking the
more common broad-based approach to clean energy, which
included renewables and some of the newer technologies to
mitigate some of the carbon and manage some of the carbon
in its traditional fossil fuels. She noted that the board
had not provided any direction on the topic.
Representative Hannan asked if the MEA board had discussed
that it should include coal and oil and gas (as long as it
was sequestering) when the board developed the clean energy
policy.
Ms. Estey responded that there were some broad
conversations and individual comments made about specific
technologies. She communicated that reliability and cost
were the number one priority for members, which was
important to the board. The association was hoping to
consider an "all of the above" choice; currently a whole
suite of options was on the table. She stated that the 50
percent goal meant 50 percent could be from clean energy
and 50 percent could be from thermal traditional resources
currently in use. She relayed that MEA was currently at 15
percent renewable energy and 85 percent thermal generation
through natural gas. She added that MEA used some diesel
and could switch to diesel in an emergency situation.
6:37:44 PM
Representative Galvin referenced a statement made by Ms.
Estey about doing too much too soon without understanding
unintended consequences. She asked for further explanation
of the statement.
Ms. Estey responded replied that in the past there were
other bills that suggested some more aggressive goals. She
considered the realities of integrating new kinds of power
in MEA's system as well as the limited transmission system
and the development timeline. She explained it was a
reference to ensuring there was a realistic timeline. She
relayed that MEA was very price sensitive. She detailed
that 75 percent of its members were residential and
included small businesses and families. The association
wanted to make sure there was a long enough time horizon to
allow time to transition properly and that cost and
reliability were not negatively impacted on the way to that
future.
Representative Galvin she was thinking about the next
generation and 2050 felt really far out. She congratulated
MEA for being at 15 percent [renewable energy] already. She
understood they did not want to be too aggressive but at
the same time she wanted to make sure a statement was being
made that the state was moving ahead into the next
generation of energy. She referenced Ms. Estey's statement
that some project delays resulted from circumstances that
were no one's fault. She asked how many years it would take
to develop a large solar project.
Ms. Estey responded that MEA was looking at gas contracts
shifting and changing by April 1, 2028. The association was
keenly aware of a timeline and was working as fast as it
could to try to decrease the amount of gas it had to use
immediately and to plan for that future. She remarked that
there were some obstacles in the way including supply chain
issues (it now took a couple of years to get some of the
necessary electrical components), permitting associated
with putting up a windfarm including the ability to get
barges through Cook Inlet and potential impacts on
wildlife. She relayed that currently there was scarcity in
the market and economics were a factor. She explained that
it would drive more immediate action even more than policy
because the things were needed now. She hoped they could
get there faster, but she also understood that at higher
penetration levels, additional transmission would be
needed. She mentioned economic and technical constraints of
the transmission system in the capacity and redundancy that
could be relied upon when using power from other places.
Additionally, there were the economic distortions of
wheeling and how it impacted price. Many of the things
needed to be moved around and ideally out of the way in
order to move forward as fast as possible. She agreed, the
sooner the better.
Representative Galvin highlighted key words used by Ms.
Estey including reliability, cost, redundancy, capacity,
and things around supply chain, which was related to
permitting as well. She referenced a large hydro project in
Susitna that had not begun and was possibly dead. She
considered that if it was built, it would likely be
finished by 2050. She asked if her understanding was
accurate.
Ms. Estey believed the answer was yes but would need to
confirm with others on the timeline. She relayed that there
were a lot of hurdles with the specific project, especially
with permitting and financing. She explained that the
transmission system would need to be overhauled in order to
move that kind of power. She added that there were some
people in the MEA service territory who were very opposed
to the project; therefore, there were likely legal hurdles
as well. She stated that the answer was, "Possibly." She
believed that it would be necessary to decide what
direction the state wanted to go. She highlighted that
large hydro or nuclear projects were not something MEA
could do on its own; it would require collaboration with
other utilities or more likely, collaboration with the
state to pick a path. She relayed that MEA looked forward
to having the discussion with the governor and legislature
on what the path could look like and how to move forward as
a state.
Representative Galvin thanked Ms. Estey for her helpful
perspective.
Co-Chair Foster asked to hear from the second invited
testifier.
6:46:00 PM
JEREMY KASPER, DIRECTOR, ALASKA CENTER FOR ENERGY AND
POWER, UNIVERSITY OF ALASKA FAIRBANKS (via teleconference),
thanked the committee and bill sponsor for their work on
the bill. He remarked that Ms. Estey had done a great job
covering a lot of the basics of the bill. He provided
prepared remarks:
The Alaska Center for Energy and Power is an applied
research institute at the University of Alaska
Fairbanks with a mission to develop and disseminate
practical, cost-effective, and innovative energy
solutions. We have active projects across a wide range
of energy subject matter areas including a recent
effort with the utilities to analyze multiple
scenarios for decarbonizing the Railbelt electric grid
while ensuring the system could continue to operate
reliably and cost-effectively. There are a number of
important energy policy decisions before this
committee. Yesterday we heard about House Bill 307,
which relates to terms as how we manage our
transmission network, and I know you have hearings on
that coming up next week as well. The bill before us
now, HB 368, addresses the complimentary aspects of
the Railbelt grid and clean energy standard. My goal
today is to provide insight into the potential
benefits and considerations associated with renewable
portfolio standards (RPS) as well as clean energy
standards as policy mechanisms available for Alaska's
energy landscape. My colleague Miss Gwen Holdmann is
scheduled to testify on Monday.
As we consider options for our state it's helpful to
understand the difference between the policies. An RPS
is a binding requirement for electric suppliers to
procure a minimum percentage of energy generation,
knowledgeable renewable energy sources. The RPS
generally includes penalties, which in the case of co-
ops, they potentially flow directly down to the
customers. While similar to an RPS, the clean energy
standard usually considers a broader set of eligible
technologies and the focus of the CES is not just on
renewable energy, but also typically low or zero
carbon emitting energy sources. Things like nuclear or
abated coal (basically coal with carbon capture). If
effectively implemented, both an RPS and a CES present
the opportunity to displace natural gas for power
generation usage and conserve Cook Inlet natural gas
for later use in home heating in the Anchorage area.
Most of the Railbelt utilities have already adopted
some voluntary targets for adding renewables or
reducing carbon output. Some of this is driven by
industry demand. For example, two of the most
important customers with GVEA are Fort Knox and Pogo
Mines. If one of these operations were to shut down,
it would result not just in the loss of local jobs,
but the cost to deliver power to other GVEA customers
would increase considerably. Having those industrial
customers helps keep cost at a minimum for all
consumers. Many industries are setting their own
internal carbon targets for their operations. For
example, Santos has committed to operating the Pikka
field at a net zero operation. Kinross, which owns and
operates Fort Knox along with many other mines around
the world has also set aggressive targets for
decarbonizing their global operations. Their Fort Knox
operation is one of the most carbon intensive
operations they have and that is certainly a factor
that industries will take into account whether to
invest in Alaska. Several of the committee members
joined myself and other ACEP staff to Iceland late
last year. That is a country with cheap clean energy,
and they are turning away industry because they can
afford to choosey and there are limits on available
power. I hope someday Alaska will be in that enviable
position, but that will require thoughtful policy
choices including those before this committee now.
6:50:32 PM
Mr. Kasper continued to provide prepared remarks:
The final report of the governor's Alaska Energy
Security Taskforce underscored the urgency of
diversifying our energy sources and bolstering our
energy advance. One of the recommendations from the
Railbelt subcommittee was to establish a clean energy
standard, so I'm happy to see that bill before the
committee now. Toward these ends both ACEP and the
National Renewable Energy Laboratory recently
completed studies of future electricity generation
scenarios for the Railbelt, what they might cost and
how they might work on the Railbelt grid.
Both studies concluded that a diverse mix of fossil
fuel power plants and new technologies such as hydro,
wind, nuclear, and tidal meet the Railbelt's future
electricity needs while dramatically cutting the fuel
cost of power; however, achieving these fuel savings
requires major capital investment. An RPS or a CES can
help by providing a clear market signal that may
attract private sector capital and private sector
development of the clean energy industry.
It is also important to recognize that implementing an
RPS and/or a CES may have varying impacts depending on
the specific context of Alaska's energy sector and
economy. While these policies offer potential
benefits, they also present challenges and
considerations that merit careful evaluation. Factors
such as cost to ratepayers, reliability, resource
availability, technological readiness, stakeholder
engagement, and other economic considerations should
be thoroughly [inaudible] to determine the most
suitable approach for the state.
Mr. Kasper concluded it was essential to approach policies
with a balanced perspective, taking into account the
state's diverse needs and priorities and by carefully
evaluating potential benefits and challenges. He stated it
would result in more informed decisions that would
contribute to a more sustainable and resilient process and
future for the state.
Co-Chair Foster thanked Mr. Kasper for his testimony.
6:52:58 PM
Co-Chair Foster OPENED public testimony.
6:53:30 PM
KEN HUCKEBA, SELF, WASILLA (via teleconference), stated
that Ms. Estey had not disclosed her association with the
Renewable Energy Alaska Project (REAP). He rejected the
idea that the state needed to do anything with carbon
control. He believed Alaska had such a miniscule footprint
and the costs did not come with metrics on what would be
accomplished. He did not know "why we're chasing all of
these things" when the state had reserves to do otherwise.
He stated that MEA did not have 15 percent renewable energy
sources when taking out the dam they wanted to tear out. He
remarked that MEA wanted to take a credit for renewables,
but it wanted to take them out at the same time. He stated
that wind and solar were the current renewable energy
sources in Alaska and that they run 11 to 42 times cost of
what many studies projected. He considered the cost and
federal money and stressed that residents paid the taxes
too. He underscored that the energy sources were
exorbitantly expensive and unreliable. He remarked that
individuals had never seen a cost analysis on improving
reliability. He remarked that individuals were being told
it would cost hundreds of millions of dollars to do
renewables at the cost of ratepayers and the state to
receive matching funds. He stated that renewables were not
affordable.
Mr. Huckeba stated that the MEA board met quarterly and
discussed whether or not rates needed to be increased. He
detailed that it was based on the inflow of revenues from
electrical sales. He stated that a large portion of
electrical sales would go to profiteers out of state and
the money would not be rolled back in to pay for
infrastructure in Alaska. He thought it was inappropriate.
He remarked that the Watana Dam could be up and running in
about four years according to the MEA website and there
could be a gasline and use existing infrastructure. He
never saw a cost analysis on what it would cost to use
existing infrastructure for gas even if it was imported. He
referenced statements that it was expensive, but he had not
seen figures. He remarked that the money for supply chain
for many renewables was going out of state.
Mr. Huckeba would like to see an amendment to the
legislation so that none of the credits went to foreign
entities or investors. He reiterated his objection to the
carbon narrative. He thought the state should do things
better than wind and solar. He elaborated that the capacity
factor at the large wind farm in Delta was about 11
percent. He highlighted that on the coldest days it had
only generated 2 percent capacity. He stated that residents
were being told that the energy sources would be cheaper,
but the transmission and storage had to be built out to
make them viable. He emphasized that Alaska had dark, cold,
and inclement weather, meaning the storage required would
be extremely expensive in the trillions of dollars. He
supported the use of gas and coal without carbon
sequestration. He stated that the governor was bragging
about getting rid of emissions requirements on
transportation. He wondered why he could not do it here as
well. He thought the legislature should strive for that. He
remarked on Alaska's minimal footprint and did not want to
see it absorb costs for changes to its infrastructure. He
thanked the committee for its time.
6:59:25 PM
Co-Chair Foster CLOSED public testimony.
Co-Chair Foster set an amendment deadline for HB 260 for
noon on Monday, April 29.
Representative Coulombe asked if any members intended to
submit amendments.
Representative Josephson requested time to look at the
bill, but he would likely not file an amendment.
Co-Chair Foster set an amendment deadline for HB 368 of
Wednesday, May 1 at 5:00 p.m.
7:02:29 PM
Representative Rauscher clarified that the bill would not
replace hydrocarbon or coal usage. It would merely offer a
different source alongside the existing sources. He
highlighted that Cook Inlet was currently running out of
available gas. There were other bills moving forward to try
to "push those forward and make that more of a successful
campaign." He explained that HB 368 provided another
diversification that could be utilized in the future to use
less gas, making more available for heating at a cheaper
price if more could not be found in the inlet. He
elaborated that it would stave off running out [of gas] as
quickly. Additionally, he clarified that the bill did not
dictate anything to happen with carbon capture and
sequestration. The bill did not make changes to how coal
was currently burning in powerplants in Alaska and did not
deter the process. He appreciated the committee for hearing
the bill.
Representative Josephson shared that he had prepared five
amendments for another of Representative Rauscher's bills,
HB 223. One of his concerns with HB 368 was that it did not
displace diesel or coal. He viewed it as a problem with the
bill and he believed a number of people in the building
would not find it aggressive enough as an RPS standard. He
requested an amendment deadline of May 2 at 9:00 a.m.
Co-Chair Foster believed it was a reasonable request. He
communicated the amendment deadline would be May 2 at 9:00
a.m.
7:05:26 PM
HB 368 was HEARD and HELD in committee for further
consideration.
Co-Chair Foster reviewed the agenda for the following
meeting.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB260 Additional Documents-January 2024 Dept of Health 01.31.2024.pdf |
HFIN 4/26/2024 1:30:00 PM |
HB 260 |
| HB260 Sectional Analysis 02.01.2024.pdf |
HFIN 4/26/2024 1:30:00 PM |
HB 260 |
| HB260 FY25 Gov Operating Budget for DOH 02.01.2024.pdf |
HFIN 4/26/2024 1:30:00 PM |
HB 260 |
| HB260 Sponsor Statement 02.01.2024.pdf |
HFIN 4/26/2024 1:30:00 PM |
HB 260 |
| HB 368 Legal Memo 042424.pdf |
HFIN 4/26/2024 1:30:00 PM |
HB 368 |