Legislature(2025 - 2026)GRUENBERG 120
02/20/2025 01:30 PM House ENERGY
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| Audio | Topic |
|---|---|
| Start | |
| Presentation(s): Alaska Solar 2016 - 2025 | |
| Presentation(s): Alaska Rural Energy Considerations | |
| Presentation(s): Tanana Chiefs Conference Energy Program Funding and Mission | |
| 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
February 20, 2025
1:39 p.m.
DRAFT
MEMBERS PRESENT
Representative Ky Holland, Co-Chair
Representative Donna Mears, Co-Chair
Representative Chuck Kopp
Representative George Rauscher
Representative Mia Costello
MEMBERS ABSENT
Representative Bryce Edgmon
Representative Cathy Tilton
COMMITTEE CALENDAR
PRESENTATION(S): ALASKA SOLAR 2016 - 2025
- HEARD
PRESENTATION(S): ALASKA RURAL ENERGY CONSIDERATIONS
- HEARD
PRESENTATION(S): TANANA CHIEFS CONFERENCE ENERGY PROGRAM FUNDING
AND MISSION
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
BEN MAY, Owner
Alaska Solar
Anchorage, Alaska
POSITION STATEMENT: Gave a PowerPoint presentation on solar
energy.
BRIAN HIRSCH, PhD, CEO
DeerStone Consulting
Anchorage, Alaska
POSITION STATEMENT: Gave a PowerPoint presentation on energy in
rural Alaska.
EDWARD DELLAMARY, Rural Energy Manager
Tanana Chiefs Conference
Fairbanks, Alaska
POSITION STATEMENT: Gave a PowerPoint presentation on Tanana
Chiefs Conference and its energy program.
ACTION NARRATIVE
1:39:19 PM
CO-CHAIR HOLLAND called the House Special Committee on Energy
meeting to order at 1:39 p.m. Representatives Costello, Kopp,
Rauscher, Mears, and Holland were present at the call to order.
^PRESENTATION(S): Alaska Solar 2016 - 2025
PRESENTATION(S): Alaska Solar 2016 - 2025
1:41:34 PM
CO-CHAIR HOLLAND announced that the first order of business
would be a presentation on Alaska Solar, 2016 to 2025.
1:41:52 PM
BEN MAY, Owner, Alaska Solar, gave a PowerPoint presentation on
solar energy [hard copy included in the committee packet]. On
slide 1, he gave a history of Alaska Solar, which began in 2016.
He stated that the price of solar panels was dropping at that
time, and permits had become easier to obtain because
regulations had changed. He pointed out that because of
community solar projects, people trust solar now. He spoke
about the growth of capacity in solar, which has doubled within
the last year.
MR. MAY moved to slide 2 and spoke about how solar jobs have
helped to keep people in state. He pointed out that Alaska
Solar pays comparable wages for construction jobs, and it offers
benefits. He stated that most of his clients are residential,
but solar demand is growing with commercial businesses. He
continued that Alaska Solar is starting to do bigger projects,
such as with utilities. He moved to slide 3, which showed
examples of bigger projects Alaska Solar is doing with Chugach
Electric.
1:47:37 PM
REPRESENTATIVE RAUSCHER questioned the cost of solar when
considering the needed labor, engineering, administration, and
materials.
MR. MAY responded that some material costs have decreased, while
inverters and wiring costs have increased. He stated that "soft
costs" of residential solar are around 40 percent of the labor
costs, as this includes municipal permits, applications, and
inspections. He summarized that labor is about a third of the
cost, while the rest consists of materials and overhead. In
response to a follow-up question, he stated that self-
installation could save an individual up to 50 percent of these
costs. He pointed out the difficulties in shipping the
materials and the permitting process. He added that the biggest
impediment to self-instillation would be the permitting process.
MR. MAY, in response to a follow-up question from Co-Chair
Holland concerning self-installation, stated that the
engineering and the permitting process would first need to be
determined. He noted that the permitting process initially took
him five to six months, but now it takes him around five to six
hours. After finishing the project, there would be an
inspection by the municipality, and possibly an inspection by
the corresponding utility company. In response to a follow-up
question, he stated that currently commercial solar projects are
subject to state permits, and for larger projects, the permit
cost would be 1 percent of the value of the project. He
suggested that the cost of the permit for larger projects should
be capped, as a $16 million project would barely have a return
on the investment.
1:55:10 PM
MR. MAY stated that, because of pricing trends of the materials
and other energy sources, Alaska Solar's experience has mirrored
the larger world experience utilizing this energy. He expressed
the opinion that the worldwide market is becoming more
competitive for energy, with the emphasis in the next decade
being on the cheapest energy. He suggested that this would
affect Alaska's population. On slide 4, he pointed out the
decrease in the price of solar panels in the last 20 years, as
the price has gone from $2,000 a panel to $155 a panel. He
compared the price of gas and solar per megawatt hour, pointing
out that solar plus a battery would be the most economical
option. He stated that over the last 4 decades there has been a
10-fold increase in the installation of solar systems to the
grid. He opined that if this usage continues, solar would be 60
percent of the worldwide energy usage in 10 years.
MR. MAY argued that solar projects are cheaper and more easily
deployed than other energy infrastructure projects; therefore,
the capitalist market would be going in this direction. To be
competitive, he asserted, "Cheaper energy matters." He moved to
slide 5 and pointed out that the biggest "headwind" in Alaska to
solar energy is the uncertainty with the current federal
administration and the funding freeze. He expressed the opinion
that this would undermine trust. He gave the example of the gas
shortage in the state as a "tailwind," as this has driven
utilities toward solar energy. He discussed annual net
metering, stating that this would save gas for the purpose of
heating homes. He expressed the opinion that annual net
metering would also provide a better return on investment for
solar energy projects.
CO-CHAIR MEARS questioned the issues that might dissuade
individuals from using solar.
MR. MAY expressed uncertainty concerning the amount of solar
that would be allowed on the grid, as this could be an issue.
He suggested that a regulatory change could help, as current
regulation would not allow the needed capacity for commercial
solar systems.
2:08:16 PM
CO-CHAIR HOLLAND questioned Alaska Solar's involvement with the
community solar projects.
MR. MAY expressed the opinion that community-led solar projects
have "run their course." He stated that this effort "primed the
pump on solar" and people were involved, but it has waned in the
last couple of years.
REPRESENTATIVE RAUSCHER requested an explanation of the
calculation of the 900 tons of carbon offset, as seen on slide 6
under "Achievements."
MR. MAY stated that this amount is the average for the country.
He pointed out that the slide shows the achievements of
customers, employees, subcontractors, suppliers, and more. He
pointed out that adding up the achievements is a "trickle
effect." In conclusion, he stated that all the panels he has
installed are still working, and "this is the beauty of solar."
REPRESENTATIVE KOPP questioned any upgrades that would be needed
with the installation of solar energy.
MR. MAY suggested that upgrades would be rarely needed. He
noted that occasionally a transformer upgrade would be needed.
He added that in community projects, new lines might need to be
run. He stated that for the larger projects the problem arises
of how to share the cost.
^PRESENTATION(S): Alaska Rural Energy Considerations
PRESENTATION(S): Alaska Rural Energy Considerations
2:13:49 PM
CO-CHAIR HOLLAND announced that the next order of business would
be a presentation on rural energy.
2:14:15 PM
BRIAN HIRSCH, PhD, CEO, DeerStone Consulting, gave a PowerPoint
presentation on energy in rural Alaska [hard copy included in
the committee packet]. He stated that the company has been in
existence for 10 years, and it works across the state. He noted
that DeerStone Consulting's expertise is concentrated in clean
energy, including solar, wind, hydropower, biomass, batteries,
geothermal, energy efficiency, powerplant upgrades, and
distribution systems. He stated that it is also involved in
other infrastructure issues, such as broadband, water and
sanitation, and transportation.
DR. HIRSCH stated that this work is concentrated in villages in
the state, and the company is "all about people." On slide 2,
he noted that 20 employees work from various locations across
the state. He explained that DeerStone provides services to
communities from the beginning to the execution of projects,
along with trouble shooting. This includes working with
funding, workforce development, site control, and permitting.
He stated that this work also includes consulting with
stakeholders to understand the unique challenges in the
different communities.
DR. HIRSCH pointed out that because Deerstone works with tribes
and municipalities in rural Alaska, it also works with the well-
known agencies and organizations in these areas, including many
Native organizations and utility companies. He moved to slide
3, which demonstrated where Deerstone's projects are located.
He noted that with the federal funding freeze, $265 million in
grants to clients have been frozen, and this money was for
executing projects. He gave an example of a project on hold in
Kotzebue that would interties smaller communities in the area to
an electrical grid.
2:22:44 PM
REPRESENTATIVE RAUSCHER questioned whether any frozen funds
would be accessible in the near future.
DR. HIRSCH expressed uncertainty on the funding. He expressed
hope that the federal government would meet its pre-signed
obligations. He stated that a report on the funding would need
to be submitted to the federal government within 90 days. He
expressed the understanding that this could be related to the
Impoundment Control Act of 1974, which addresses the authorities
of the different branches of government.
REPRESENTATIVE COSTELLO questioned the contents of the 90-day
report to the federal government.
DR. HIRSCH stated that Deerstone is not involved with submitting
the report, as this would be an internal federal agency review
through the U.S. Department of Energy. He stated that Deerstone
has reached out to federal agencies, but there has been no
response.
2:26:00 PM
DR. HIRSCH moved to slide 4, titled "Role of State Funding in
Rural Communities." He stated that while most of the funding
comes from the federal government, state funding is "critical."
He noted that federal funding requires a non-federal cost share,
and the Alaska Energy Authority often provides this funding. He
noted that areas with more resources leverage the non-federal
requirements more easily. He noted that the Renewable Energy
Fund (REF) is a longstanding program, and he urged the committee
to continue to support this. He suggested that REF could be
used to match federal funds that have not been frozen. He
pointed out that there could be emergency needs during power
outages, especially in winter.
DR. HIRSCH moved to slide 5 and discussed the role of the Power
Cost Equalization (PCE) Program in rural communities. He stated
that PCE is more widespread than the Rural Energy Fund, as it
was created to support energy projects on the Railbelt in
exchange for rural energy funding. He pointed out that PCE is
an endowment fund with no cost to the state. He referenced the
complicated nature of the PCE formula, suggesting that it needs
to be optimized. He also suggested that the Regulatory
Commission of Alaska could give more guidance to the program.
2:33:15 PM
DR. HIRSCH, in response to a question from Representative Kopp,
stated that Deerstone has worked with the Alaska Native Health
Consortium on projects.
CO-CHAIR HOLLAND expressed the understanding that many of
Deerstone's projects work to link energy demand with supply. He
questioned the use of smart metering demand control to break
down barriers in the renewable systems.
DR. HIRSCH responded that this question is complex, as wind and
solar availability can be unpredictable. He noted that
batteries could be used to store some of this energy, but
typically, electricity is not used for generating heat except in
the case of heat pumps. Because of this, he noted that wind in
the wintertime could help with the heat demand. He explained
that using smart metering in the villages would be complicated
because of the need for high-speed internet. He expressed the
understanding that connectivity is improving, but there would
need to be "a whole host of things" to solve this problem.
Concerning heat demand, he suggested that energy efficiency in
homes should be addressed before smart metering. He expressed
the opinion that the first steps to address home heating should
be repairing homes and power plants. He explained that using
smart metering is a multistep process that takes time.
^PRESENTATION(S): Tanana Chiefs Conference Energy Program
Funding and Mission
PRESENTATION(S): Tanana Chiefs Conference Energy Program Funding
and Mission
2:38:18 PM
CO-CHAIR HOLLAND announced that the final order of business
would be a presentation on Tanana Chiefs Conference and its
energy program.
2:38:38 PM
EDWARD DELLAMARY, Rural Energy Manager, Tanana Chiefs Conference
(TCC), gave a PowerPoint presentation on TCC's energy program
[hard copy included in the committee packet]. He stated that he
would discuss TCC's energy program, funding, projects, and
mission. On slide 2, he stated that TCC is a nonprofit tribal
consortium composed of 42 members, with 37 federally recognized
tribes. He stated that TCC's region covers 235,000 square miles
in the Interior. He pointed out that only nine of these
communities are on the road system, and the Railbelt serves only
one. He added that diesel power plants serve the remaining
communities.
MR. DELLAMARY moved to slide 3 and discussed TCC's energy
program. He pointed out that it was created for economic
reasons after the economic crisis of 2008. He listed some of
TCC's services, including grant writing, emergency energy
support, and renewable energy project planning and
implementation. He added that solar energy has been proven in
the Interior of Alaska. He pointed out his work in the
villages, as TCC also provides energy administrative assistance
for utility management and engineering support.
MR. DELLAMARY, in response to a question concerning geothermal
from Representative Rauscher, stated that in the community of
Manley Hot Springs there has been evaluations for geothermal and
ground source heat pumps, but there have been no installations.
2:45:23 PM
The committee took an at-ease from 2:45 p.m. to 2:46 p.m.
2:46:00 PM
MR. DELLAMARY moved to slide 4 and stated that TCC works with
several utility partners, such as the Alaska Village Electric
Cooperative, Alaska Power and Telephone, Golden Valley Electric
Assn, and independent utilities. He discussed the expensive
cost of energy, as the average price of fuel in these
communities is $7 a gallon. He stated that one of TCC's goals
is to alleviate this high cost, and he added that diesel is 50
percent of the total expenditure for the utility. He noted that
the Power Cost Equalization (PCE) Program helps lower some of
the costs of electricity.
MR. DELLAMARY moved to slide 5 and discussed projects aimed at
bringing down fuel costs. This includes using energy efficiency
measures, examining economies of scale, and implementing energy
upgrades. He stated that the majority of this work focuses on
installing renewable energy, as there has been available funding
for this. He further discussed the use of renewable energy,
with the goal of tribal energy sovereignty.
MR. DELLAMARY moved to slide 6 and discussed the federal funding
freeze. Since the funding freeze, he stated that TCC has worked
to secure $16 million in federal funding; however, $131 million
of funding is at risk. He expressed confusion and lack of
clarity concerning the future of these funds, noting that only
one of three planned construction projects would go forward this
summer. He discussed this project further.
MR. DELLAMARY, in response to a question from Co-Chair Mears,
responded that if funds were available tomorrow, the projects
could begin; however, they would not be completed, as the
timeline has been damaged. In response to a follow-up question,
he explained that the estimated additional cost for a delayed
project would be difficult to assess because potential tariffs
could increase the cost of steel and other materials. He stated
that there are too many variables to formulate an answer.
2:56:18 PM
MR. DELLAMARY moved to slide 7 and pointed out the successful
solar energy projects in Hughes, Manley Hot Springs, and Galena.
He stated that data could now be drawn from these projects. He
explained that the solar project in Hughes is saving 10,000
gallons of diesel per year. He expressed the hope that future
projects could make a larger dent in the fuel bill. He stated
that previously fuel was being flown into Hughes at $9 a gallon,
but now a fuel farm has been built so fuel can be purchased at a
lower cost.
MR. DELLAMARY, in response to a question from Co-Chair Holland,
discussed the graphs on the slide, which showed the impact of
independent power producers (IPPs) on PCE in Hughes. He stated
that Hughes spends around $260,000 annually on fuel, and this is
after a reimbursement of around $150,000. He noted that there
was a drop in the fuel bill after the installation of solar
energy. He stated that TCC has been modeling this with the goal
of creating a stable business model to ensure longevity. He
explained that the federal funding agencies would need assurance
that this infrastructure has been built to last. In conclusion,
he stated that this is a symbol of success in remote Alaska.
3:02:03 PM
REPRESENTATIVE RAUSCHER expressed appreciation to the presenters
and remarked that the Renewable Energy Fund was referenced in
each presentation, and he noted that the governor supports the
fund.
CO-CHAIR HOLLAND thanked the presenters and gave closing
comments.
3:03:34 PM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Energy meeting was adjourned at 3:03 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HENE TCC_ Feb 20 2025.pdf |
HENE 2/20/2025 1:30:00 PM |
HENE_TCC Presentation_2.20.25 |
| HENE_DeerStone - Alaska Rural Energy Considerations.pdf |
HENE 2/20/2025 1:30:00 PM |
HENE_2.20.25_Deerstone |
| HENE_ AK Solar 02.20.25.pdf |
HENE 2/20/2025 1:30:00 PM |
HENE AK Solar 2.20.25 |