Legislature(2013 - 2014)BARNES 124
03/20/2013 08:00 AM House ENERGY
| Audio | Topic |
|---|---|
| Start | |
| Overview(s): Energy Wise Program | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ENERGY
March 20, 2013
8:04 a.m.
MEMBERS PRESENT
Representative Doug Isaacson, Co-Chair
Representative Neal Foster
Representative Pete Higgins
Representative Shelley Hughes
Representative Benjamin Nageak
Representative Andy Josephson
MEMBERS ABSENT
Representative Charisse Millett, Co-Chair
COMMITTEE CALENDAR
OVERVIEW(S): ENERGY WISE PROGRAM
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
SARAH SCANLAN, Deputy Director
Rural Alaska Community Action Program, Inc. (RurAL CAP)
Anchorage, Alaska
POSITION STATEMENT: Provided a PowerPoint presentation
entitled, "Rural Alaska Community Action Program, Inc. Energy
Programs: Designed to Meet the Needs of Alaskans."
ELLEN KAZARY, Development Director
Rural Alaska Community Action Program, Inc. (RurAL CAP)
Anchorage, Alaska
POSITION STATEMENT: Participated in the PowerPoint presentation
entitled, "Rural Alaska Community Action Program, Inc. Energy
Programs: Designed to Meet the Needs of Alaskans."
TOMMY BALLOT SR.
Selawik, Alaska
POSITION STATEMENT: Testified in support of the Energy Wise
Program during the presentation by Rural Alaska Community Action
Program, Inc.
KIRK OVIOK JR.
Selawik, Alaska
POSITION STATEMENT: Testified in support of the weatherization
program during the presentation by Rural Alaska Community Action
Program, Inc.
ACTION NARRATIVE
8:04:46 AM
CO-CHAIR DOUG ISAACSON called the House Special Committee on
Energy meeting to order at 8:04 a.m. Representatives Foster,
Higgins, Hughes, Nageak, Josephson, and Isaacson were present at
the call to order.
^OVERVIEW(S): ENERGY WISE PROGRAM
OVERVIEW(S): ENERGY WISE PROGRAM
8:05:49 AM
CO-CHAIR ISAACSON announced that the only order of business
would be an overview of energy programs presented by Rural
Alaska Community Action Program, Inc. (RurAL CAP).
8:06:03 AM
SARAH SCANLAN, Deputy Director, Rural Alaska Community Action
Program, Inc. (RurAL CAP), informed the committee RurAL CAP is
working statewide to reduce the burden of energy issues for
residents of the state and seeks capital funds in the amount of
$1.6 million which will be matched by private and other sources
of funds. RurAl CAP is involved in many areas such as childhood
development and education, self-help, weatherization, affordable
housing, energy programs, and solid-waste management programs
and employs over 1,000 residents in 81 communities [slides 2 and
3]. The economic impact of RurAL CAP is further enhanced by its
energy programs that are designed to be sustainable over time at
low cost to the state.
8:09:35 AM
ELLEN KAZARY, Development Director, Rural Alaska Community
Action Program, Inc. (RurAL CAP), informed the committee a
survey of participants at the 2012 Alaska Federation of Natives
(AFN) convention showed that energy is the top need in rural and
urban Alaska and has been for a long time [slides 4 and 5]. The
Alaska Housing Finance Corporation (AHFC), Department of
Revenue, estimates annual average household fuel and electric
costs are a huge portion of income in every region [slide 6].
She advised the question remains as to whether residents "heat
or eat" even though Alaska has the resources to address this
problem. In fact, for the low income population, energy costs
can be 40 percent to 50 percent of their household income
[slides 6 and 7]. RurAL CAP is the largest weatherization
service provider in the state and will serve about 830 homes in
the coming year [slides 8 and 9]. The weatherization program
looks at the whole home including insulation, windows, and
construction work [slide 10]. The application is a simple four-
step process beginning with a home assessment and weatherization
work by local crews. Typical weatherization work includes
ventilation, safety, windows, insulation, completion, and
follow-up visits for quality control [slides 11-17]. During the
past four to five years, about 8,500 homes have been
weatherized; however, this year's governor's budget request of
$60 million for the weatherization program and home rebate
program will result in a reduction to about one-half of the
current level.
8:14:52 AM
MS. KAZARY, in response to Representative Hughes, said the
governor's budget request was about $60 million for the
weatherization and home rebate programs and AHFC requested
$101.5 million.
CO-CHAIR ISAACSON said many homes have been weatherized, but
many remain to be done and surmised that new homes are not being
built to proper standards. Not providing economic opportunities
by developing roads and resources is perpetuating poverty.
MS. KAZARY agreed there is an ongoing energy need throughout the
state and weatherization is part of the solution. Since 2008,
about 8,500 homes have been weatherized and she estimated that
there are about 29,000 households in rural Alaska in addition to
income-eligible households in Fairbanks, Juneau, and Anchorage.
Communities are eligible for weatherization services every 10
years because it is an ongoing need, and that is one of the
reasons that the Energy Wise Program works with residents on how
to maintain and preserve their home and its weatherization
improvements.
8:18:53 AM
MS. SCANLAN said it is hard to provide equity and to balance the
benefits from large energy projects - such as the Susitna-Watana
Hydro project - with benefits for Alaskans who choose to live in
rural areas. All are Alaskans and are doing their part for
economic and resource development, including Alaska Native
Claims Settlement Act (ANCSA) shareholders. Ms. Scanlan urged
the committee to think deeply about how to work together for the
benefit of everyone. As a provider, RurAL CAP will share
resources and leverage funds for programs that contain elements
of self-sufficiency and education for its beneficiaries.
REPRESENTATIVE HUGHES asked how many homes the proposed funding
amounts could weatherize, and whether federal or other funds are
available.
8:22:58 AM
MS. KAZARY advised that U.S. Department of Energy (USDOE)
funding to RurAL CAP is very low for weatherization, and past
state participation in weatherization has been added to American
Recovery and Reinvestment Act of 2009 (AARA) funds. This year
is the first year that all of the AARA funds have been spent.
Overall, about $100 million has been invested in weatherization
and rebate programs over the last few years.
REPRESENTATIVE NAGEAK disclosed he is a past president of RurAL
CAP and currently serves on the board of directors. RurAL CAP
works hard to ease life in the villages through several programs
and its subsidiary, Rural Energy Enterprises. He urged the
state to partner with tribes because more projects would be
completed using the tribes' access to federal funds. The tribal
village government in the North Slope has been working on
weatherization projects for many years, and other tribal
governments are willing to help solve problems.
8:28:25 AM
REPRESENTATIVE HIGGINS understood that AHFC awards grants to
RurAL CAP so that it can provide weatherization services. He
asked how RurAL CAP will utilize its capital request of $1.6
million.
MS. KAZARY explained that RurAL CAP administers two different
energy programs, one of which is the weatherization program
funded through AHFC. The Energy Wise Program is more about
education, efficiency, and conservation within the home, and is
supported by the $1.6 million request for funds.
REPRESENTATIVE FOSTER asked how much was received for
weatherization last year.
MS. KAZARY estimated over 1,000 homes were completed with $15
million.
REPRESENTATIVE FOSTER surmised the grant money from AHFC must
comply with federal income eligibility guidelines, which allow
different levels of income for rural and urban communities. He
asked for suggestions on what the legislature might do to adjust
for the difference in the cost of living in rural and urban
areas.
8:32:14 AM
MS. KAZARY confirmed that urban and rural residents are
constrained to follow income eligibility guidelines to receive
and use funding for weatherization. She observed there are many
middle income homeowners who are not eligible for
weatherization, but still struggle to pay for home improvements.
This is more common in rural Alaska where building costs are
very high. Alaska Housing Finance Corporation has a very
popular rebate program for homeowners who can pay for
improvements and wait for a refund; however, in rural Alaska,
shipping supplies adds to the cost and the rebate program fails
middle income residents who live there.
CO-CHAIR ISAACSON suggested the use of a voucher for the upfront
expenses and then the portion paid by the state would be paid
directly to the vendor.
MS. KAZARY said RurAL CAP considered this option in its
partnership with NANA Regional Corporation Inc. (NANA) to bring
the Energy Wise Program to their region. She pointed out that
RurAL CAP does not manage the rebate program, but this change
could make the program more accessible.
CO-CHAIR ISAACSON asked whether the legislature or the agency
would make this change.
MS. KAZARY was unsure.
CO-CHAIR ISAACSON requested RurAL CAP submit a written response
on this option.
8:36:03 AM
MS. SCANLAN spoke in support of a change to enable more
participation in the rebate program.
MS. KAZARY turned attention to the Energy Wise Program. In
order to stretch resources and meet the needs of more people,
RurAL CAP developed its Energy Wise Program about 10 years ago.
The program seeks to provide energy efficiency and conservation
education, and energy improvements in homes. The goal of the
program is to work with local communities and help relieve the
burden of high energy costs [slide 19]. To develop the program
RurAL CAP employees first asked residents what would be most
helpful. Time was spent in homes with a kilowatt meter to test
appliances and identify the areas of high energy consumption.
From these experiences, the program was developed to make
individualized assessments and lower individuals' energy costs.
In 2009, RurAL CAP piloted the program which was designed to
reduce energy consumption and use local labor to do the work
[slide 20]. Since 2010, the Energy Wise Program served 22
communities, benefitted 2,000 households with lasting results,
and trained and employed 240 rural Alaskans [slide 21]. Program
performance has been proven by the Alaska Energy Authority
(AEA), Department of Commerce, Community & Economic Development,
energy efficiency working group; in fact, AEA identified the
Energy Wise project as a program that should be replicated
around the state. Many other organizations around the state
have recognized that this program is working, and also that it
is a collaborative effort with state and federal partners and
with local community organizations and utilities [slides 21-23].
Ms. Kazary advised that the program does not replace
weatherization, but complements weatherization by educating
residents on how to maintain the improvements to their homes and
how to access other programs [slide 24]. The program is also
effective because it hires, trains, and certifies local crew
members; in fact, crews can receive technical certification
through the Department of Labor & Workforce Development for
future employment in weatherization, construction work, and
first aid training [slides 25 and 26]. The program has three
parts, beginning with an energy fair in the community where
residents sign up for a home visit [slide 28]. During the home
visit and assessment, crews spend a day in the home with the
residents looking at electric bills, electronics and appliances,
and installing $300 of energy efficiency supplies such as
compact fluorescent lights and water heater blankets [slides 29-
32]. The final part of the program is that after three to six
months crews return to the home for follow up education, to
answer questions, and take a survey [slide 33].
8:45:01 AM
MS. KAZARY provided a budget breakdown, estimating a cost of
$2,000 per household for the Energy Wise Program. About 50
percent of that cost is attributed to local employment and
training, 25 percent is for supplies, and about 27 percent for
management of the program [slide 34]. In 2010, 120 rural
Alaskans were trained and employed and sustained a 90 percent
rate of retention.
CO-CHAIR ISAACSON asked about the procurement procedures that
determine the suppliers of the products used.
MS. KAZARY explained that RurAL CAP's total budget is about $40
million per year thus it must follow very strict procurement
policies. There is a bid process for all of the supplies that
are purchased to ensure the best prices and availability. For
the Energy Wise Program, the lowest cost bid is chosen for every
item.
CO-CHAIR ISAACSON asked how RurAL CAP advertises for bids.
MS. KAZARY said federal policy mandates that if supplies from a
single vendor are over $100,000, it is a closed bidding process.
The purchasing department advertises, and vendors submit bids.
CO-CHAIR ISAACSON observed that purchases of supplies can
support not only Anchorage, but suppliers throughout the state.
Purchasing supplies locally may cut hidden transportation costs,
and he asked whether any products are purchased in Fairbanks
since energy efficiency equipment is available there.
MS. KAZARY assured the committee RurAL CAP is very good at
ensuring the lowest cost of products by consolidating shipping
and storage. For the Energy Wise Program RurAL CAP has been
working in the NANA region and supplies have not been purchased
in Fairbanks; however, if working in communities near Fairbanks,
RurAL CAP will look at the most effective shipping. In fact,
RurAL CAP has a small warehouse in Anchorage and would rather
have shipments drop-shipped directly out. In Kotzebue, some
supplies are available, and local purchases are made for
immediate needs.
8:49:55 AM
CO-CHAIR ISAACSON stated that local vendors need to know about
the bidding process in order to build up regional economies
throughout the state.
MS. KAZARY stated that RurAL CAP is a statewide organization and
looks at development to support economies in all communities.
She returned attention to program outcomes based on 700 follow
up surveys from homes served in 2010: 90-95 percent
participation rates; 86 percent of homes are still practicing
energy efficiency and conservation measures; 82 percent reported
decreased home heating costs; and 80 percent reported decreased
electric bills [slide 36]. An independent case study of homes
in Kasigluk revealed an average savings of $20 per month in
electricity and the equivalent of $39 in savings to the state
through the Power Cost Equalization (PCE) subsidy [slide 37].
Ms. Kazary concluded that many people were already actively
conserving energy use; in fact, the national average is about
750 kilowatt hours (kWh) of electricity used per month, and
rural Alaska uses an average of about 350-450 kWh per month. On
the other hand, savings are dramatic for those who routinely
exceed the maximum 500 kWh for PCE. Based on the Kasigluk
study, the Energy Wise Program has a less than three year return
on investment in electrical savings: an investment of about
$2,000 resulted in a savings of about $700 per year [slides 38
and 39].
8:55:15 AM
MS. KAZARY advised that after the pilot year, RurAL CAP formed a
corporate non-profit partnership with NANA in order to use
private funds to help support the program. In the northwest of
Alaska, one in four household dollars goes to energy costs and
NANA constituents were seeking solutions to the high costs
[slide 40]. The corporation contracted with RurAL CAP to
provide the Energy Wise Program to every household in its
region, and with other partners such as AEA and the local
communities, RurAL CAP has been working in the region for the
last two years. For example, another partner is the Northwest
Arctic Borough which installs in-home electric meters at the
same time Energy Wise Program crews do their work with residents
[slide 42].
REPRESENTATIVE NAGEAK opined that North Slope residents would be
interested in the in-home meters also.
MS. KAZARY observed that almost every region in the state is
interested in a partnership with RurAL CAP. In the NANA region
all 11 communities have begun assessments, over 60 crew members
have been certified, over 1,000 homes have been visited and
there is a 95 percent participation rate [slide 43]. The data
from NANA's investments of $860,000 and $900,000 over two years
is now being collected. Based on a January 2012 follow up
survey, the average electric bill in NANA communities before the
program was $312 per month, and the average savings after was 10
percent. In addition, 82 percent reported their homes felt
warmer despite record breaking cold temperatures [slide 44].
Ms. Kazary concluded, saying RurAL CAP has submitted a Capital
Project Submission and Information System (CAPSIS) request for
$1.6 million to support the Energy Wise Program in 12
communities during 2013-2014 [slides 46 and 47]. Ms. Kazary
expressed confidence that the program is effective and
efficient.
9:00:48 AM
REPRESENTATIVE HIGGINS noted RurAL CAP has many accomplishments
in employment, child development, community development,
construction and housing; however, the expansion of the
weatherization program into Anchorage diverts funds from rural
areas and the Interior where energy costs are much higher. He
urged that 90 percent of the funds should be concentrated on
areas with the highest energy costs.
MS. KAZARY acknowledged that the weatherization program grew in
Anchorage because the Municipality of Anchorage withdrew its
weatherization program about two years ago. Thus RurAL CAP
expanded its service area to about 500 homes in Anchorage, but
this does not amount to a large percentage of funding.
REPRESENTATIVE JOSEPHSON asked how RurAL CAP selects the
communities it serves.
MS. KAZARY explained RurAL CAP works with the Denali Commission
and USDOE on Project Start. The Denali Commission committed
$100,000 to ensure that Venetie and Arctic Village are included
in the Energy Wise Program. In addition, RurAL CAP looks at
communities that have the highest energy costs and that are not
receiving other services, and invites communities to apply and
make commitments for providing storage space and in-kind
resources. There is also the desire to group two or three
communities in each region by location.
9:07:15 AM
CO-CHAIR ISAACSON asked whether RurAL CAP contacts other
providers.
MS. KAZARY said the program is well-known to local organizations
such as the housing authorities and city councils. The energy
fairs provide an opportunity to coordinate services.
CO-CHAIR ISAACSON inquired as to the reception RurAL CAP
receives from the local utilities.
MS. KAZARY said RurAL CAP has a great relationship with
utilities. More than half of the communities are served by the
Alaska Village Electrical Cooperative Inc. (AVEC) which provides
staff time to assist with the collection of data. Nuvista Light
& Electric Cooperative, Inc. is also very supportive.
REPRESENTATIVE FOSTER asked where legislators can submit written
support for RurAL CAP's funding request.
MS. KAZARY said RurAL CAP has four CAPSIS requests for programs
which originated from Senator Ellis's office. If the CAPSIS
request is granted, the program will serve 12 communities,
benefit 1,000 households, and employ 70 rural Alaskans. The
total cost of the project is $2 million with funding in the
amount of $300,000 expected from the Rasmuson Foundation, and
additional support from regional corporations has been
requested.
REPRESENTATIVE JOSEPHSON applauded the work RurAL CAP is doing.
9:12:04 AM
CO-CHAIR ISAACSON opened the meeting to public testimony.
9:12:24 AM
TOMMY BALLOT SR. informed the committee he is the housing
director of the Village of Selawik, which is 30 miles above the
Arctic Circle. He said he and his wife spend over $1,200 per
month on electricity and heat. His personal experience is that
it is very expensive to get materials to the village for home
improvements. For example, one 2x4 that costs $2.40 in Seattle
costs $18 in Selawik. He said he was very thankful for the
program, although additional outside work needs to be finished
in the summer. Mr. Ballot said the program helped the community
by creating jobs, and the greatest benefit is to help young
people stay sober in the village.
REPRESENTATIVE NAGEAK observed the RurAL CAP weatherization
program underway when he was in Selawik last summer. He praised
the program and the local workers who were making improvements
on the houses.
9:18:57 AM
KIRK OVIOK JR. provided a brief background of his experience.
He worked for the Energy Wise Program for two months as a crew
leader. In the village, the tundra shifts and houses have many
cracks and spaces open to the outside. The availability of jobs
inspires residents to be drug-free. Mr. Oviok said the
weatherization is effective, and more needs to be done.
MS. SCANLAN relayed that everyone in a community comes to the
energy fair, including youth who are attracted to the
calculators and meters. It is valuable experience for the kids
to help their parents understand the math involved in conserving
energy.
MS. KAZARY stressed that there are no eligibility requirements
for the program thus all in a community receive services.
9:26:29 AM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Energy meeting was adjourned at 9:26 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Agenda (H) ENE 03202013.docx |
HENE 3/20/2013 8:00:00 AM |
(H) ENE Agenda 03202013 |
| Rural Cap Energy Wise Presentation 03202013.pdf |
HENE 3/20/2013 8:00:00 AM |
Rural Cap Energy Wise Presentation (H) ENE 03202013 |