Legislature(2017 - 2018)CAPITOL 17
03/30/2017 10:15 AM House ENERGY
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| Audio | Topic |
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| Start | |
| Presentation: Energy Solutions for Alaska | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ENERGY
March 30, 2017
10:17 a.m.
MEMBERS PRESENT
Representative Adam Wool, Chair
Representative Ivy Spohnholz, Vice Chair
Representative Matt Claman
Representative Dean Westlake
Representative DeLena Johnson
Representative Jennifer Johnston
Representative George Rauscher
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
PRESENTATION: ENERGY SOLUTIONS FOR ALASKA
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
GWEN HOLDMANN, Director
Alaska Center for Energy and Power
University of Alaska Fairbanks
Fairbanks, Alaska
POSITION STATEMENT: Presented a PowerPoint titled "Energy
Solutions for Alaska."
ACTION NARRATIVE
10:17:14 AM
CHAIR ADAM WOOL called the House Special Committee on Energy
meeting to order at 10:17 a.m. Representatives Wool, Rauscher,
Sphohnholz, Johnston, Johnson, and Westlake were present at the
call to order. Representative Claman arrived as the meeting was
in progress.
^Presentation: Energy Solutions for Alaska
Presentation: Energy Solutions for Alaska
10:17:32 AM
CHAIR WOOL announced that the only order of business would be a
presentation by the Alaska Center for Energy and Power.
10:17:51 AM
GWEN HOLDMANN, Director, Alaska Center for Energy and Power
(ACEP), University of Alaska Fairbanks, shared some information
on her background as a physicist and engineer and her work on
energy projects in Alaska. She directed attention to slide 2,
"Alaska Center for Energy and Power,and reported that the
program began nine years ago and focused on the challenges
facing Alaska. She said that once a particular problem was
identified, then a research team was built, and resources were
gathered to address that specific problem. She declared that
they created information for the decision makers. She added
that they had also worked lot with students in K - 12 in
developing the Alaska Energy Smart curricula, a popular energy
efficiency curriculum tailored to Alaska.
MS. HOLDMANN moved on to slide 3, "Current and recent research
in Alaska," and stated that the focus was for energy programs in
which the state was interested, including studies directed by
the Alaska State Legislature.
MS. HOLDMANN shared slide 4, "Presentation Overview," and
explained that she would discuss three areas: Energy technology
solutions, supporting energy policy, and Alaska leadership in
microgrid technologies. She declared that the energy policy had
a very important role in any accomplishments in Alaska, pointing
out that Alaska had 10 percent of the world's microgrids.
CHAIR WOOL asked if there was any concern for research
investment.
MS. HOLDMANN replied that, as Alaska was already a leader, it
was easier to maintain momentum. She shared a recent report
that the Canadian government had invested $400 million into an
Arctic Energy fund, which would stimulate activity for renewable
energy systems. She declared that it was important for Alaska
to step up to stay at the cutting edge of technology.
REPRESENTATIVE JOHNSTON asked about energy storage.
MS. HOLDMANN replied that energy storage was a "bit of a holy
grail." Low cost energy storage solutions would allow for a
real global paradigm shift for the production and use of energy.
She said that this had been a focus area for a number of years,
and she offered an example of thermal storage, as it was a less
expensive and very effective means for meeting the energy needs
of a community, more so than the use of batteries.
10:26:21 AM
MS. HOLDMANN discussed slide 5, "Energy Technology Solutions:
Communities," and reported that Alaska had a very high
discrepancy for energy costs throughout the state. She shared
that the North Slope had the lowest rates for electric power in
the state, as the borough had subsidized the costs for local
heat and power for many years. She pointed out that it was
important to understand that subsidies and energy pricing drove
the development of renewable energy systems.
CHAIR WOOL asked to clarify that these subsidies on the North
Slope were not PCE (Power Cost Equalization).
MS. HOLDMANN said that these were subsidies provided through the
borough and were in addition to the state subsidies. She
observed that the North Slope Borough was the only region in the
state which had not developed any renewable energy system. She
suggested that these subsidies distorted the market as they did
not recognize the true cost of energy, but, instead, it
subsidized the status quo.
CHAIR WOOL mentioned that the committee had discussed PCE and
whether it enhanced or inhibited the development of alternate
energy.
MS. HOLDMANN said that the PCE system was the most transparent
and easy to understand compared to those in other jurisdictions
which came through multiple government entities. She stated
that it was important to understand who was actually benefitting
from a switch to an alternative energy strategy, otherwise it
was difficult to meet the goals of the project.
REPRESENTATIVE JOHNSON asked about ground heat technology and if
it was available all over Alaska.
MS. HOLDMANN explained that Juneau used a heat pump system,
which was first installed as a seawater heat pump system in
Seward. She reported that these were very efficient, and they
magnified the value of the energy by pulling energy from the
environment. She said that the problem was they were driven by
electric power, so they must be in areas with inexpensive
electric power. She said that the ACEP had done an analysis of
the performance of that system and had subsequently written a
guide to heat pump systems for cold climates. She added that
Kotzebue was reviewing air source heat pump systems to magnify
the value of the energy. She declared that these systems were
not as beneficial in Interior Alaska.
MS. HOLDMANN pointed out that, as most of the diesel fuel used
in Alaska was imported from outside Alaska, the pricing was
driven by global markets and this was additionally challenged by
the narrow window for shipping. She stated that these were more
reasons for local energy sources.
10:32:55 AM
MS. HOLDMANN shared the map on slide 9, which demonstrated the
magnitude of the challenge to off grid due to remoteness and
incomplete infrastructure. She reported that there were almost
1.6 million people sharing power and energy resources who lived
north of the grid line.
CHAIR WOOL asked about for the definition for off grid.
MS. HOLDMANN expressed her agreement that there was a struggle
with terminology and explained that her definition was for
individuals and communities who were disconnected from the main
grid. She added that the technical term was micro grids.
MS. HOLDMANN moved on to slide 10, "ACEP Partnership with FNSB,"
and spoke about the partnership with the Fairbanks North Star
Borough [FNSB]. She said that, as a portion of the ACEP funding
was designated toward Alaska communities, they were working on
strategies which could be implemented locally and be deployed in
the near term.
REPRESENTATIVE JOHNSTON asked about partnerships with the
military.
MS. HOLDMANN replied that they had an extensive global
partnership with the Office of Naval Research.
MS. HOLDMANN directed attention to slide 11, "Volter Pilot
Project at Big Dipper." She relayed that, along with solving
energy problems, driving economic development was very
important. She spoke about adapting technologies, as they did
not believe in re-inventing the wheel, and she lauded the work
with biomass in Finland. She spoke about a Finnish designed
heat and power biomass system which could work well for
Fairbanks and many other rural communities.
REPRESENTATIVE JOHNSON asked if biomass could include coal.
MS. HOLDMANN explained that these were wood chips, which were
cheaper to produce than pellets in smaller communities. She
reported that there was a pellet mill in Fairbanks. She stated
that this system was not designed to run on coal, although the
gasification process was similar. She reported that the new
combined heat and power plant on the University of Alaska
Fairbanks campus was designed to co-fire with up to 30 percent
of biomass.
CHAIR WOOL asked about the air quality from this new technology.
MS. HOLDMANN said that this technology would not result in high
level particulates, and it was an opportunity to educate about
the differences for burning wood.
MS. HOLDMANN spoke about slide 12, "Energy Solutions for
Communities & Industry," and highlighted that most microgrid and
distributed generation technologies did not have anything to do
with rural and remote places. She pointed out that this was a
move away from a centralized generation model with one-way
transmission to the end users, toward a two-way movement and
flow of electricity, with pockets of small generation. She
declared that this was the new paradigm for electricity in
modern grids. She offered her belief that Alaska was an
excellent place to pilot technologies and strategies. She
listed the components to include firm generation, which included
hydro power and fossil fuels; intermittent generation, which
included wind power; energy storage, which included batteries,
fly wheels, and thermal storage; and demand response, which was
the ability to alter the power in response.
10:43:52 AM
MS. HOLDMANN pointed to slides 13-14, "ACEP Power System
Integration Lab," which depicted the laboratory, a recreated
small microgrid at full power level designed to mimic operations
in the not so perfect conditions of the real world.
CHAIR WOOL asked if intermittent power sources could be
mitigated with an efficient storage system.
MS. HOLDMANN acknowledged that inexpensive grid scale storage
was necessary, although the current costs were still fairly
high. She shared some examples of battery storage, including a
liquid metal battery with an unlimited number of cycles which
could be done on a small scale but not yet on a utility size.
She returned attention to slide 14 and stated that the goals
were to reduce problems in the field, reduce the cost of energy
to the end users, turn off the diesels whenever possible, and
train system operators. She explained that the lab was
contracted by private sectors to test systems, and then work on
integration packaging. She added that it was cost neutral. She
moved on to slide 15, "Raglan Mine Flywheel Integration &
Testing," and explained that this was a system they had worked
on in the lab, as it had never been integrated into a stationary
power application. She said that their job was to figure out
how to connect the developer's project to the grid, as the
testing in the lab allowed failures which were not acceptable in
the field.
MS. HOLDMANN returned to slide 16, "Analysis of Emerging
Technologies: Storage." She said that many battery
manufacturers had "come and gone." She reported that Golden
Valley Electric Association operated one of the largest battery
systems in the world, which supported the northern end of the
Railbelt intertie.
CHAIR WOOL asked about the type of batteries.
MS. HOLDMANN replied that these were nickel cadmium, although it
was only designed for potential outages, as it was a giant UPS
(uninterruptable power supply) system. She spoke about a few
battery systems, none of which had yet succeeded. She
emphasized that they wanted to get things into community use.
She clarified that they wanted the failures to occur in the lab.
She shared that the lab was currently working with the Alaska
Village Electric Cooperative on a small grid bridge system using
ultra capacitors.
10:53:21 AM
MS. HOLDMANN shared slide 17, "Analysis of Emerging
Technologies: Nuclear," and reported that the program was also
interested in understanding where the market was going with new
technologies. She reported on a nuclear power program study
which the Alaska State Legislature had commissioned, and APEC
had worked with ISER (Institute of Social and Economic Research)
on the technical and economic feasibilities. She noted that, if
this existed, there could be potential, and they were keeping
track of the ongoing technology.
MS. HOLDMANN shared slide 18, "Emerging Technologies:
Hydrokinetics," and spoke about hydrokinetics, generating power
directly from moving water, either in a river, a tide, or any
current. She reported that there was a lot of interest from
remote communities with moving water nearby. She said that a
full-scale test site was maintained in Nenana, and she pointed
out that, as private investors and not the state had invested in
many of these tests, many of these projects were not well known.
REPRESENTATIVE RAUSCHER asked about tidal energy.
MS. HOLDMANN replied that this was an example that investing
enough money can make anything possible; however, as a way to
reduce the cost of energy, tidal energy was not there just yet.
REPRESENTATIVE RAUSCHER asked if ACEP was still exploring this
and were there any improvements to the process.
MS. HOLDMANN replied that currently University of Alaska had a
partnership with the University of Washington and Oregon State
University for the operation of the National Marine Renewable
Energy Research Center on behalf of the Department of Energy.
She reported that there was a major focus on wave energy, tidal
energy, and in-river energy. She added that this had been under
consideration for Cook Inlet for quite some time.
REPRESENTATIVE RAUSCHER asked if this was viable yet.
MS. HOLDMANN replied that it was not yet economically viable.
REPRESENTATIVE JOHNSON pointed out that, as rivers in Alaska did
not flow all year because of cold temperature or ice, consistent
power would require multiple types of technology.
MS. HOLDMANN acknowledged that every site in every community was
different, with different challenges. She relayed that ACEP was
trying to remove these barriers for industry and communities to
deploy the various systems. She reported on the development of
a debris diversion system to protect the turbines and its
testing and implementation.
11:03:23 AM
The committee took an at-ease from 11:03 a.m. to 11:10 a.m.
11:10:30 AM
MS. HOLDMANN offered her belief that Alaska should be thinking
about what emerging technologies made sense for the state to
invest and research versus what would be adopted in the future
should it be developed elsewhere. She stated that the emerging
energy technology grant funds were designed to address these
questions, and she offered an example of hydrokinetic energy as
Alaska had huge resources. She said that small modular nuclear
reactors and energy storage also had potential for global
application, and Alaska should be aware of what was happening
with these technologies. Although Alaska did not have the
funding and resources for these developments, the state should
be part of figuring out how to utilize these new paradigms. She
pointed out that there were 92 utilities in the state, which
were good places to test new technologies.
CHAIR WOOL reiterated that the power systems of the future were
less centralized, and that the utilities could be viewed as
microgrids.
MS. HOLDMANN relayed that there were already more than 250
microgrids at many different levels, and that some were
interconnected. She noted that the utilities in the Railbelt
used to be island kingdoms. She stressed that, as there were
millions of hours of operation of these micro grids in Alaska,
Alaska could be part of the global transitions in the energy
market.
MS. HOLDMANN addressed slide 19, "IP Disclosures by ACEP in past
2 years" and said that ACEP worked a lot with the private sector
for developing their technologies, as well as in-house
development. She offered an example for the development of a
fuel meter which would show the amount of energy used.
MS. HOLDMANN discussed slide 20, "Supporting Energy Policy," and
declared that this was where substantive changes could be made.
She said that Alaska energy policy had resulted in global
leadership for some emerging energy technology areas. She
offered an example of the Renewable Energy grant fund and the
Power Cost Equalization program. She spoke about the ACEP work
with the RCA (Regulatory Commission of Alaska) on the concept of
a Unified System Operator for the Railbelt grid, as well as an
LNG market analysis for the coastal communities with AEA. She
stated that there was an opportunity to "tweak" the Power
Project Loan Fund, an excellent fund designed for Alaskans,
which was also underfunded.
11:18:39 AM
MS. HOLDMANN moved on to slide 21, "Assessment of a USO for the
Railbelt Grid," and explained that ACEP provided technical
assistance to the RCA and gave a series of presentations looking
at specific challenges related to factors for efficient and
effective transmission of electricity on the Railbelt grid,
including reliability, cost, and autonomy for the different
utility entities. ACEP provided information on what had been
done elsewhere and what possible outcomes might occur.
REPRESENTATIVE JOHNSTON asked about the policy decisions,
whether the cost was an economic study or a technical study.
MS. HOLDMANN explained that they used relevant resources and
that the economics and the technical aspects went hand in hand.
MS. HOLDMANN, in response to Representative Westlake, said that
ACEP was not always mentioned in reporting, as they provided
technical assistance behind the scenes. They were not
recommending policy, but instead, providing the information to
support recommendations and policy. She offered her belief that
it was very appropriate that ACEP was not mentioned in many
reports.
CHAIR WOOL relayed that the House Special Committee on Energy
had been more involved on the political side, and not on the
technical side.
MS. HOLDMANN said that these were important issues, as it was
necessary for the utility industry to function as efficiently
and effectively as possible. She acknowledged that there were
constraints and there was a reality for the way things happened.
She declared that ACEP was a technical resource, with some
understanding for the underlying issues and challenges. She
stated that this was not a simple problem with a simple
solution.
MS. HOLDMANN directed attention to slide 22, "AK AES Project:
Barriers to Private Investment," and stated that private
investment was very important moving forward on energy projects.
11:25:41 AM
MS. HOLDMANN introduced slide 23, "Cordova ESS (Specification
Driven Project)," and spoke about the necessity to change the
paradigm so projects would be developed around the community
needs and what the grid could accept. Once that was resolved
the project could be put out to bid to the private market. She
addressed slide 24, "Cordova Storage Project (Proposed)," a
graph which reflected the daily and seasonal changes.
MS. HOLDMANN, in response to Representative Claman, said that
the blue line was the five-day demand average, and the orange
line was the [power] generation, which was always more than the
demand in case of an increase. She shared that ACEP had
proposed a battery system that purchased power at night, when it
was cheaper, and then sold the services back to the utility
during the day. She pointed out that the battery could be
tapped if necessary, which allowed for the use of the generator
in case of demand to be kept at a lower level. She allowed that
this "spinning reserve" was the most important aspect.
REPRESENTATIVE JOHNSTON asked about the economic benefit for the
"spinning reserve."
MS. HOLDMANN pointed out that the asset, which was privately
owned, did not work in this case because the value was mainly in
owning the battery. She said that in many of these smaller
projects, they would incur these challenges for identifying an
interested private partner.
CHAIR WOOL asked if the battery was a bridge between the diesel
and the hydro in case the demand was high. The utility was
saving money by not keeping the diesel running, but the battery
was not selling a lot of power.
MS. HOLDMANN expressed her agreement, and that understanding how
the system was being used and where the value was were the
important issues in determining the correct model.
MS. HOLDMANN observed that there was a place for private
ownership models in Alaska. She declared that the motivation
from a private entity for keeping an asset running was really
high, as there was not any payment without the asset being on
line. She opined that the customer would not necessarily pay
more money when a private investor was utilized.
REPRESENTATIVE WESTLAKE suggested that a battery pack was
ancillary to the generation of renewable energy.
MS. HOLDMANN shared slide 26, "Alaska's Renewable Energy
System," which depicted the 70 renewable energy systems
statewide, some of which had been developed through the
Renewable Energy Fund. She stated that Alaska was a leader in
these developments, which could allow for new revenue
opportunities and jobs for Alaskans. She projected that there
would not be a lot of state dollars available in the upcoming
years and that it was important to use private sector models.
11:34:39 AM
MS. HOLDMANN shared slide 28, "Iceland: Global leader in
geothermal energy," mentioning that she had worked in geothermal
industries and that she was an Arctic Initiative Fulbright
Scholar and had worked in Iceland. She reported that Iceland
needed to develop geothermal as they were importing coal from
Europe. This had been a politically active decision for the
transition to local energy resources. Now, 100 percent of
electricity and heat was from geothermal and hydropower
resources. She reported that Iceland had gained an expertise,
learned how to do this right, and had created an export industry
for geothermal energy knowledge. She opined that this export of
knowledge was now about 7 percent of the gross domestic product.
She reported that this knowledge base allowed for consultation
overseas when there was a lull in projects at home, and this
kept the industry employed. She stated that 3 percent of the
GDP was spent on research and development, and there was a lot
of public advocacy for geothermal expertise, slide 29,
"Iceland's Knowledge Export Industry." She pointed to slide 30,
"Overseas activities of Icelandic companies," which depicted the
worldwide geothermal energy projects being worked on by Iceland.
She moved on to slide 31, "Iceland UNU Geothermal Training
Program," and spoke about the key differences from small
investments. She reported on the careful selection process to
bring 20 participants annually to the six-month training
program, where they were introduced to the industry. Those
students, when they returned to their home country, now had many
contacts in Iceland for partnership.
MS. HOLDMANN introduced slides 32 - 33, "ARENA: Arctic Remote
Energy Networks," explaining that this was a copy of the Iceland
program, and that Iceland was a mentor for developing ARENA.
She said that ARENA currently focused on the circumpolar Arctic,
gathering and sharing knowledge with others around the
circumpolar Arctic, and building connections and bridges on the
practitioner level, instead of the policy level. She noted that
everyone had a specific project to move forward.
REPRESENTATIVE SPOHNHOLZ expressed her excitement about the
ARENA project, and she asked if the program was secure and how
to ensure it would stay in place.
MS. HOLDMANN shared her concerns, noting that it was originally
an Alaska based program. She stated that it was an ACEP
program, and there was no federal funding. She offered her
belief that this was a global issue. She reported that they met
every other year, and that it would continue if ACEP wanted.
She acknowledged that funding was a substantive challenge, and
that there was not a large budget for the program.
MS. HOLDMANN suggested a change in the ARENA name from Arctic to
Alaska, and she reiterated that funding was an issue. She
declared that small investments could go a long way, and that
the private sector could also invest.
REPRESENTATIVE JOHNSTON opined that Alaska had not done a good
job of exporting knowledge and capability, and that a lot of
these had escaped the state.
CHAIR WOOL reiterated that Alaska was becoming a leader in micro
grid technology and that it was important to maintain that edge.
MS. HOLDMANN said that this was just one example for where
Alaska was innovative and been a leader. She closed with slide
34, "Alaska Center for Energy and Power," stating that the
little stuff makes a big difference in these areas.
11:49:17 AM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Energy meeting was adjourned at 11:49 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| House Energy 3.30.17 - Gwen Holdmann, ACEP, UAF.pdf |
HENE 3/30/2017 10:15:00 AM |