02/20/2008 03:30 PM Senate RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| SB246 | |
| HB315 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 246 | TELECONFERENCED | |
| + | HB 315 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
February 20, 2008
3:36 p.m.
MEMBERS PRESENT
Senator Charlie Huggins, Chair
Senator Bert Stedman, Vice Chair
Senator Lyda Green
Senator Lesil McGuire
Senator Gary Stevens
Senator Bill Wielechowski
Senator Thomas Wagoner
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 246
"An Act establishing a working group to analyze the potential of
a hydroelectric power project on the Susitna River; and
providing for an effective date."
HEARD AND HELD
HOUSE BILL NO. 315
"An Act extending the termination date of the Big Game
Commercial Services Board; and providing for an effective date."
HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: SB 246
SHORT TITLE: SUSITNA HYDRO WORKING GROUP; REPORT
SPONSOR(s): SENATOR(s) THOMAS
01/19/08 (S) READ THE FIRST TIME - REFERRALS
01/19/08 (S) RES, FIN
02/13/08 (S) RES AT 3:30 PM BUTROVICH 205
02/13/08 (S) Heard & Held
02/13/08 (S) MINUTE(RES)
02/20/08 (S) RES AT 3:30 PM BUTROVICH 205
BILL: HB 315
SHORT TITLE: EXTEND BIG GAME COMMERCIAL SERVICES BOARD
SPONSOR(s): RULES BY REQUEST OF LEG BUDGET & AUDIT
01/15/08 (H) READ THE FIRST TIME - REFERRALS
01/15/08 (H) L&C, FIN
01/28/08 (H) L&C AT 3:00 PM CAPITOL 17
01/28/08 (H) Moved Out of Committee
01/28/08 (H) MINUTE(L&C)
01/31/08 (H) L&C RPT 6DP 1NR
01/31/08 (H) DP: GARDNER, LEDOUX, BUCH, RAMRAS,
GATTO, OLSON
01/31/08 (H) NR: NEUMAN
02/05/08 (H) FIN AT 1:30 PM HOUSE FINANCE 519
02/05/08 (H) Moved Out of Committee
02/05/08 (H) MINUTE(FIN)
02/06/08 (H) FIN RPT 3DP 5NR
02/06/08 (H) DP: KELLY, JOULE, THOMAS
02/06/08 (H) NR: CRAWFORD, HAWKER, STOLTZE, MEYER,
CHENAULT
02/11/08 (H) TRANSMITTED TO (S)
02/11/08 (H) VERSION: HB 315
02/13/08 (S) READ THE FIRST TIME - REFERRALS
02/13/08 (S) RES, FIN
02/20/08 (S) RES AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
SENATOR JOE THOMAS
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Sponsor of SB 246.
SARAH FISHER-GOAD, Acting Executive Director
Alaska Energy Authority (AEA
POSITION STATEMENT: Commented on SB 246.
JAMES HENSATH, Deputy Director of Development
AEA and AIDEA
Anchorage AK
POSITION STATEMENT: Commented on SB 246.
ERIC YOULD, Wood Canyon Group
And TDX Power
POSITION STATEMENT: Commented on SB 246.
MIKE WRIGHT, representing himself
Fairbanks AK
POSITION STATEMENT: Supported SB 246.
DENNIS WIDMORE, representing himself
Fairbanks AK
POSITION STATEMENT: Supported SB 246.
PHILLIP OATES, City Manager
Seward AK
POSITION STATEMENT: Supported SB 246
BRADLEY EVANS, Acting Chief Executive Officer
Chugach Electric Association
Anchorage AK
POSITION STATEMENT: Supported SB 246.
JERRY MCCUTCHEON, representing himself
Anchorage AK
POSITION STATEMENT: Supported SB 246.
LINDA HAY
Staff to Representative Ralph Samuels
Legislative Budget and Audit Committee
Alaska State Capitol
Juneau, AK
POSITION STATEMENT: Supported HB 315.
PAT DAVISON, Legislative Auditor
Division of Legislative Audit
Juneau AK
POSITION STATEMENT: Supported HB 315.
ROBERT FITHIAN, Executive Director
Alaska Professional Hunters Association
Anchorage AK
POSITION STATEMENT: Supported HB 315.
ACTION NARRATIVE
CHAIR CHARLIE HUGGINS called the Senate Resources Standing
Committee meeting to order at 3:36:54 PM. Present at the call to
order were Senators Green, Stevens, Stedman, Wielechowski,
Wagner and Huggins.
SSSB 246-SUSITNA HYDRO WORKING GROUP; REPORT
3:37:28 PM
CHAIR HUGGINS announced SB 246 to be up for consideration.
SENATOR JOE THOMAS, sponsor of SB 246, started with reading the
sponsor statement as follows:
Senate Bill 246 will direct the governor to have the
Alaska Energy Authority (AEA) analyze the
hydroelectric potential of the Susitna River. The AEA
will review and update the studies done in the past,
evaluate cost analysis, financing options, current and
future demand and other critical issues to determine
the feasibility of the project. The governor will
submit a final report to the legislature no later than
July 1, 2010.
In recent years, Alaskans have seen their energy costs
skyrocket. These ever-rising costs and uncertain
supplies not only make it difficult for Alaskans
across the state to make ends meet, but also have an
adverse impact on economic growth.
The energy produced by a hydroelectric facility is
predictable, stable, clean and low cost. Currently,
the Bradley Lake hydroelectric dam produces energy for
the Railbelt at just $.05 per kWh, far below the $.176
per kWh that the Interior is currently paying.
In addition to these factors, the majority of our
combustion turbine power plants along the Railbelt are
over 30 years old and all will need retrofitting and
replacement that will cost between $1 billion and $2.5
billion over the next ten years. Once these
replacements begin, we will continue with the same
rising energy costs, fluctuating operating expenses
and high polluting facilities that the citizens of the
state have experienced in the past.
Twenty five years ago, when a dam along the Susitna
River was last looked at, Cook Inlet gas cost $.21 per
million cubic feet (mmcf), the population and energy
demand along the Railbelt was substantially less then
today, and energy costs were no where near what they
are today. I believe all these factors, along with the
environmental and long term energy considerations
merit a reopening of the Susitna discussion.
Nothing is as comprehensive of an approach to reducing
costs, emissions and dependence on finite, non-
renewable energy production for the Railbelt and
adjacent areas as a Susitna Dam project.
I urge you to support the passage of SSSB 246.
3:38:23 PM
SENATOR MCGUIRE joined the committee.
3:40:33 PM
CHAIR HUGGINS asked Senator Thomas to walk through who he is
proposing to be the members of the Alaska Energy Authority.
SENATOR THOMAS replied that the bill just designates the
authority itself and he had anticipated that the new energy
coordinator would be the person who would direct that activity.
The governor's office sees that as the way forward as well.
3:41:53 PM
CHAIR HUGGINS asked who he is recommending the AEA consult with.
SENATOR THOMAS answered that it's important that it at least
consults with several major departments within the state - the
Department of Natural Resources (DNR), Department of
Environmental Conservation (DEC), Alaska Department of Fish and
Game (ADF&G), Department of Labor and Workforce Development
(DOLWD) and the Department of Commerce, Community & Economic
Development.
3:42:25 PM
SENATOR STEDMAN asked if the study would encompass the
electrical grid and do a cost back analysis of what should be
the power generation.
SENATOR THOMAS answered yes.
SENATOR STEDMAN asked if it would concentrate on hydro, coal or
natural gas as the source.
SENATOR THOMAS answered he anticipated that it will look at all
energy sources within the Railbelt area with an emphasis on
Susitna. But to do a feasibility comparison, those other sources
would have to be taken into consideration.
SENATOR GREEN asked if legislation would be required for a group
of state commissioners to get together as a committee with the
AEA coordinator. She didn't think they were really needed and
she would rather see experts doing the study.
SENATOR THOMAS answered he didn't intend for the departments to
be put together in a committee, but rather that the AEA would
consult with them on an individual basis.
3:46:07 PM
CHAIR HUGGINS asked him to explain what the Alaska Energy
Authority is.
SENATOR THOMAS replied that the AEA is a department within the
DCCED and it is charged with all the energy responsibilities for
the state. Other state departments have taken on varying degrees
of responsibility and that is the impetus for an energy
coordinator.
3:47:18 PM
CHAIR HUGGINS asked if the energy coordinator position is
currently vacant and if its subordinates are the existing body.
SENATOR THOMAS answered yes.
CHAIR HUGGINS asked for the Energy Authority representative to
come forward.
3:48:10 PM
SARAH FISHER-GOAD, Acting Executive Director, AEA, explained
that the AEA is a state corporation and has gone through a
number of changes. In 1993, it was statutorily changed and not
allowed to have staff or to own any future projects; the rural
programs were put into the Division of Energy in the Department
of Community and Regional Affairs. At that time, AEA's programs
were administered and still are administered by AIDEA staff. So,
AEA contracts with AIDEA to provide the staff support for its
programs. That was increased in 1999 to include the former
Division of Energy Programs, which was in the former Department
of Community and Regional Affairs.
Even though AEA exists as a corporation and doesn't have staff,
it could only own a project with legislative authorization. She
said the AIDEA has 66 staff members, many of whom work both on
AIDEA and AEA projects.
MS. GOAD said with the governor's emphasis on having an energy
coordinator, the AIDEA board of directors adopted by-law changes
that allow an AIDEA executive director to be different than an
AEA executive director. This position has always been the same
person since 1993. With the energy coordinator and AEA executive
director appointments, there will be two people.
SENATOR WIELECHOWSKI asked the mission of the AEA.
MS. GOAD answered the mission is to reduce the cost of energy
for Alaskans.
SENATOR WIELECHOWSKI asked if AEA had looked at a bullet line
bringing gas down from the North Slope (at a cost of $2.5
billion) and if she anticipated at least comparing it to a
Susitna hydro project that would probably provide a lot of the
same needs.
3:52:10 PM
MS. GOAD answered that what Senator Thomas envisions goes beyond
Susitna. The fiscal note tries to address the different
components of the bill and some of the regional planning that
needs to be done.
SENATOR WIELECHOWSKI asked if a spur line into South Central
would provide the same sort of energy they would get from the
Susitna dam.
3:53:21 PM
JAMES HENSATH, Deputy Director of Development for both AEA AND
AIDEA, answered that the bullet line is a way to move gas from
the North Slope to South Central and it has its cost which will
come out in the cost of the fuel. The long term plan comparison
would look at how the Susitna project would fit in. Using
natural gas turbine generation would be one of those.
He explained when South Central was in full bore with LNG and
Agrium at capacity, gas consumption as it related to electrical
generation was 15 percent of the total gas consumption - a
potentially small component of what could be delivered by that
gas line.
CHAIR HUGGINS asked what he had been working on in the last 24
months.
MS. GOAD answered that the AEA side has concentrated mostly on
rural energy projects. A deputy director of Rural Energy
oversees that. Their primary funding source for building energy
infrastructure for communities in rural Alaska is the Denali
Commission and they have done bulk fuel tank farms and rural
power system upgrades. They also provide technical assistance
for those communities to help them be sustainable and address
some maintenance needs through a circuit rider program and
technical assistance.
AEA also runs the $27-million Power Cost Equalization Program
that provides subsidy payments to rural utilities for rate
payers, for residential and community facilities. In addition to
that rural energy work, since 1993 AEA actually owns
infrastructure including the Bradley Lake Hydro Electric
Project, the Alaska Intertie that runs from Willow to Healy and
the small Larson Bay Hydro Project - and from 1993-1999 AEA
owned the Four-Dam Pool Power Projects. In addition, AEA has
been attached for studies for some capital projects; one is the
AK/BC Intertie and an energy export study. It is currently
working on a Railbelt Electrical Grid Authority project and an
advisory committee just met in their building yesterday to
listen to that progress. They expect some results this summer
with respect to organizational aspects for the Railbelt
utilities.
CHAIR HUGGINS asked who makes up the advisory committee.
MS. GOAD answered the committee was comprised of various stake-
holders in the Railbelt, some utilities stake-holders and
consumer groups, finance folks, former Representative Norm
Rokeberg and other interested individuals.
CHAIR HUGGINS asked when AEA will have a fulltime coordinator.
3:58:31 PM
MS. GOAD answered she expects an appointed executive director
for AEA who is also the energy coordinator very soon. For the
AIDEA executive director they are working with a management head
hunter firm to find potential candidates - maybe by late spring
for that position to be filled. It has been vacant since
February 1.
3:59:22 PM
CHAIR HUGGINS asked how they would take on this task if the bill
passes.
MS. GOAD answered they expect this to be a multi-year capital
project and would manage it similarly to how they have managed
other projects through capital appropriations. Updating the old
studies can happen with information and expertise that is
already in the building.
4:01:09 PM
MR. HENSATH added that through their procurement offices, AEA
developed a number of term contracts with a variety of
engineering contractors in Alaska. He said they would go to
three of the term contractors who have the expertise in the
hydro and other energy areas. They would want an engineering
contractor by the end of June to begin valuation of the Susitna
material and update the engineering and cost estimates.
4:01:57 PM
SENATOR WAGONER asked if the Army Corps would be involved in
this project.
MR. HENSATH replied that AEA will go where the information takes
them. At this point, the fiscal note doesn't identify the Army
Corps of Engineers as a particular contact, but because of their
history, they would be contacted.
He explained that HB 246 examines the viability of Susitna as an
electric generation project in the Railbelt and their initial
effort will be focused on examining the current information and
the design that $135 million put together in 1984. They will
look for engineering flaws that may have occurred or new
information and get a cost to determine if it is a viable
project.
SENATOR WAGONER said he didn't know of any other organization or
group of engineers with more expertise in the world for building
dams than the Army Corps. It would be a natural fit to bring
them on at the start of any project and any review of
information.
CHAIR HUGGINS concurred.
4:03:38 PM
CHAIR HUGGINS asked if this would require a FERC certificate.
MR. HENSATH answered not at this point.
CHAIR HUGGINS said "Let's talk about projects; not studies. This
is about building something." Assume you're going to build a dam
by 2010.
MR. HENSATH answered by the summer of 2010 there is a
possibility they would stop work if the economics don't look
viable or the cost of power is too much, but after looking at
all the different alternative costs and factors, they would have
a report that says whether the Susitna dam is a viable project
to go ahead with.
CHAIR HUGGINS wanted to understand what length of time they are
talking about after that "for the beavers to build the dam."
MR. HENSATH estimated approximately 7-10 years including a
three-year engineering and FERC permitting process and
construction period before power is being delivered. Part of the
study would evaluate that schedule.
CHAIR HUGGINS noted that the project was potentially racing the
gas pipeline.
MR. HENSATH replied very much so, but they may not be in the
same race.
CHAIR HUGGINS asked if he was the official representative from
the administration on this bill.
4:06:41 PM
MS. GOAD answered that AEA is the point agency with respect to
working on the fiscal note and determining how much the study
would cost. She didn't represent that the administration had
taken a position on the project.
CHAIR HUGGINS asked if anyone from the administration was at the
meeting.
MS. GOAD replied that whether there is support for the actual
project, there is an agreement that an analysis needs to be done
as laid out in SB 246.
CHAIR HUGGINS asked if administration supports SB 246.
MS. GOAD answered she couldn't say.
4:08:32 PM
SENATOR GREEN asked if going back to the Army Corps 1960
comprehensive study had any merit.
4:08:36 PM
MR. HENSATH answered his opinion would be no. The Corps did a
number of studies on the four-dam project for Susitna; they
ultimately came to a two-dam project that the state took over in
the early 80s and completed a major engineering study for
including information on a FERC application that would probably
still be valid and could be used on a new application. Looking
at the overall major study would little serve from the Susitna
aspect. It was marginally viable in 1984 and this evaluation
would start there.
4:10:13 PM
SENATOR GREEN asked if there should be a catch-all phrase that
wouldn't limit their opportunities to get information to
utilities, landowners, Matsu resource conservation, Fairbanks
and the Army Corp of Engineers. What about including experts?
4:10:56 PM
MS. GOAD replied that she didn't look at their list as a
limiting phrase. She intended for that language to not be
limiting, but to at the very least consult with those folks.
SENATOR GREEN stated the language didn't say that, because when
you put a list in statute, it is limited to that list.
4:12:00 PM
MR. HENSATH said the study would want to have an expert
engineering contract to look a dam, update the costs and update
the cost of power. And as they go through the socio-economic,
the environmental and other aspects, he couldn't conceive of
being limited, but he would welcome any expanding language.
SENATOR GREEN asked where it says this will be contracted out.
CHAIR HUGGINS replied there was no explicit language. They could
work with the sponsor and AEA on that.
4:13:13 PM
SENATOR STEDMAN asked to compare the evolution of this bill to
how they handled the Bradfield Corridor Southeast Intertie
Extension study from Tyee that will eventually go into British
Columbia (AK/BC).
MS. GOAD answered one similarity is the fact that in order for
them to produce a report they would contract with an engineering
firm (Hatch Energy) to complete study. She would have to get
back to them on the process they used for the fiscal note on
AK/BC versus this one.
SENATOR STEDMAN said he didn't recall that the AK/BC study was
in a bill.
MS. GOAD answered that was correct, but AEA has statutory
authority to enter into contracts and grants and does that every
day for the projects they run. They anticipate using some term
contracts with various Alaskan engineering firms to complete
this work.
SENATOR STEDMAN asked if the legislature appropriated $2.2
million to AEA now and then followed with $1.5 million in 2010
or some combination, could they "take that and run with it."
MS. GOAD answered if it was a capital project, they would
probably use the same information they used in the fiscal note
to give them the backup information on how that project would be
conducted. This is a specific way to do a capital project.
SENATOR STEDMAN said they didn't need a bill to do this then,
but they really need is an appropriation and a request.
MS. GOAD agreed and said either way they would use the same
information.
4:17:54 PM
ERIC YOULD, Wood Canyon Group, said he also represents TDX
Power. He said he has worked with the electric utility industry
in Alaska for 35 years and nine years on the Susitna project in
the 70s an 80s when he was the prime study manager for the Corps
of Engineers. He worked with U.S. Senator Gravel it was so big
project that the federal government wouldn't build it.
The state needed to take the lead and put the Alaska Power
Authority into place that later grew into the Alaska Energy
Authority. He was its first executive director and worked for
the next six years on the Susitna Hydropower Project as well as
about $1 billion more of smaller hydropower projects including
the Anchorage/Fairbanks Intertie.
MR. YOULD said he supported this bill, but he was also here on
behalf of TDX Power that is a private sector utility with
projects throughout Alaska. TDX also has a license from FERC to
bring the Chakachamna hydropower project that is about a fourth
the size of Susitna forward. He wanted to make sure that this
effort wouldn't steamroll what a private sector firm is
attempting to bring forward now and is prepared to spend $20
million in pre-construction licensing efforts - even though they
haven't decided yet if it is economically feasible.
4:20:56 PM
He said the bill's sponsor asked him to give a little bit of
background on Susitna. Basically it was studied long before the
Corps of Engineers; the Bureau of Reclamation looked at in the
1940s-60s. The Corps looked at it for three years in the 1970s
and went to Congress to get authorization to go into a joint
venture with the State of Alaska where the state would provide
funds to the Corps who would in turn be the development agent
for the project. Ultimately the board of directors for the
Alaska Power Authority decided there were other resources with
more private sector expertise than the Corps of Engineers. So
they didn't work with the Corps and went forward with the
private sector. Acres American was the initial hydropower firm
they worked with and later they brought on Harza, the largest
hydropower development firm in the world.
MR. YOULD explained when he was with the Power Authority, they
looked at Susitna for six years and ultimately it came to be a
two-dam system - Devil Canyon (650 ft. high concrete thin arch
dam) and Watana (870 ft. high earth fill structure). The two
projects together could develop some 6.5 billion kWh of
electricity annually. To put that in perspective, the Railbelt
today from Anchorage to the Kenai consumes about 5 billion kWh.
Susitna is an expensive project. The first dam to be built would
be Watana and it would cost $3.7 billion. The second one would
be Devil Canyon that would be brought on line years after
Watana, but it would only cost $1.5 billion. Both of those
figures are in 1983 dollars and at that time they also concluded
that the project could probably not be financed on the open
market unless the state put in a very major equity investment.
If the project went forward today it would cost twice as much
and the state would have to put in $4 billion to make it
financially feasible.
4:24:12 PM
MR. YOULD said in 1985, after the FERC licensed project had been
submitted to the federal government, the price of oil dropped
down to less than $10/barrel. That caused two things to happen;
one is it virtually undermined the economic viability of
Susitna. And at $9/barrel the state was not making enough money
to come up with its equity contribution. So, the state withdrew
the license application for the development of the project in
1985 where it has laid fallow ever since. Now they are bringing
the project up for review and TDX wants to make sure the
Chakachamna project doesn't get lost in the shuffle.
4:25:25 PM
He said SB 246 now has a more reasonable timeline, which he
agreed with. Of the 13 things the study is supposed to address,
it doesn't specifically call for an economic feasibility study
of Susitna and he strongly suggested that they conduct a net
present worth (NPW) life cycle feasibility study and any viable
alternatives to it.
MR. YOULD reflected that they didn't look at Susitna in a
vacuum; they looked at all the many other types of energy
projects. Sometimes they have been criticized for it, but asked
what company like Exxon or Pebble wouldn't be spending those
monies for the major kind of investments they are making today
as well. The $160 million for the studies was justified at the
time and they do have a FERC permit sitting on the shelf - it
would just need dusting off and updating.
SENATOR STEDMAN moved those figures forward 25 years at 3.5
percent inflation and that resulted in $11.8 billion and said he
only wished that construction was inflating only at inflation.
If this is a $12 billion to $15 billion capital project, the
numbers for the gas line project are significantly less than
that.
4:28:38 PM
SENATOR WAGONER said hydroelectric has the advantage of no cost
for the fuel and when President Roosevelt started to build the
Grand Coolee Dam everybody thought he was crazy. He did it for
reasons other than just producing hydroelectric power; one was
irrigation of the whole central basin of the State of Washington
and the other was to create jobs to bring this country out a
depression. However, today Grand Coolee Dam is still sitting
there generating electricity at the lowest rate for power in the
world. In the long run that has to be put into the equation when
you look at how much it's going to cost to do a dam project.
4:29:57 PM
SENATOR WIELECHOWSKI added that they should also look at any
potential carbon taxes that the federal government is
discussing.
CHAIR HUGGINS asked how far up the gorge the Chakachamna dam is
located.
MR. YOULD replied that Chakachamna is about 40 miles up the
McArthur River on the west side of Cook Inlet; it's not in the
Susitna system. The dam would be very minimal - 49 ft. high with
a 10-mile power tunnel to an underground power house on the
McArthur River. In 1982 when the Alaska Power Authority used
Bechtel Engineers who came up with a very conservative estimate
of $1 billion to build this project and it's now estimated to
cost around $2 billion.
4:32:28 PM
CHAIR HUGGINS asked how Chakachamna would hook into the power
grid.
MR. YOULD replied it would go 42 miles to the Beluga substation
and Chugach Electric.
CHAIR HUGGINS asked if it would have to go through Tyonek or
CIRI land.
MR. YOULD replied not a lot, but some; Susitna, though, is
surrounded by a lot of private land.
CHAIR HUGGINS asked what TDX stands for.
MR. YOULD replied that it is an Aleut name. TDX developed the
wind farm at St. Paul.
4:34:04 PM
MIKE WRIGHT, Fairbanks resident, supported SB 246 for three
reasons. It would provide a long-term supply of reliable and
affordable energy, stabilize costs and it is renewable.
4:35:47 PM
DENNIS WIDMORE, Fairbanks resident, supported SB 246. He said a
lot of the work he has done in the past compared alternatives to
diesel power generation in villages. One of the things that
become apparent is that with a lot of these projects using
diesel fuel versus a renewable fuel, you're trading the capital
cost of the renewable project for fuel costs. "I like to say
that we've burned fuel because it's cheaper than money; at least
that was true in the past."
He said the amount of capital that is going to be required on
the Susitna project is very sobering, but it makes economic
sense in the long run. It still needs to be looked at carefully.
4:37:39 PM
PHILLIP OATES, City Manager, Seward, supported SB 246 and said
that Seward is a Railbelt utility and purchases power from
Chugach Electric. They are also responsible for transmission and
purchase power to their outlying surface area. He had four
reasons he was interested in a hydroelectric project - the
availability of future natural gas supplies, the aging gas
turbines with Chugach Electric Association, the recognition of
need to diversify energy sources and preservation of the
environment. He said a hydro project would help them meet their
needs and that his community was not able to meet the
requirements for federal funding of energy projects.
CHAIR HUGGINS thanked him for testifying and agreed that
affordability along with environmental considerations is
important in looking at future energy alternatives.
4:40:04 PM
BRADLEY EVANS, Acting Chief Executive Officer, Chugach Electric
Association, supported SB 246. He said the entities in the
association served three-quarters of Alaska's population, but
they are not a heavily interconnected grid like in the Lower 48.
He explained that the Railbelt produces about 1,200 - 1,300
megawatts of installed generation capacity and most of it is
from natural gas or some sort of fossil fuel. Their peak days
generate about 850 megawatts of demand and of that Chugach has
about 600 megawatts of generation capacity.
He said they are heavily dependent on natural gas from the Cook
Inlet Basin. But the Railbelt has other hydro resources -
Bradley, Cooper Lake and Eklutna. He supported a feasibility
study that would update what they already know and then see how
it competes against other projects.
4:46:34 PM
JERRY MCCUTCHEON, representing himself, Anchorage, said he had
followed the Susitna energy issue since 1970. He didn't believe
there would ever be a gas line and that this is a good project
that the Army Corps of Engineers wants back.
4:52:25 PM
CHAIR HUGGINS thanked everyone for their comments and announced
that SB 246 would be set aside.
HB 315-EXTEND BIG GAME COMMERCIAL SERVICES BOARD
4:52:53 PM
CHAIR HUGGINS announced HB 315 to be up for consideration.
4:53:21 PM
LINDA HAY, staff to Representative Ralph Samuels, said HB 315
was introduced by the Legislative Budget and Audit Committee to
extend the sunset date of the Big Game Commercial Services Board
to June 30, 2012. This complies with the recommendation of the
Legislative Budget and Audit Committee who conducted an audit of
the newly reinstituted board.
4:54:04 PM
PAT DAVISON, Legislative Auditor, Division of Legislative Audit,
said the results of their audit recommended that the board be
extended for four years. A four-year extension rather than the
typical eight-year was appropriate in this circumstance because
this board had been reconstituted and had only been in existence
for two years. The audit didn't recommend any regulatory or
statutory changes.
CHAIR HUGGINS asked if there were any red flags the audit found
that they should be aware of.
MS. DAVIDSON replied the audit found administrative issues. One
of the recommendations suggested that less data be captured,
because they were capturing data from hunt reports and it wasn't
clear who the users were; so the audit wasn't confident those
records would be used by anyone. The board has a lot of issues
to deal with, but they are dealing with them.
CHAIR HUGGINS commented that it appears there is a pretty long
time-line for resolving some of the issues, which is
understandable since it is a new organization.
4:57:08 PM
ROBERT FITHIAN, Executive Director, Alaska Professional Hunters
Association, supported HB 315. He said the board is doing a good
job and its image has improved.
CHAIR HUGGINS thanked everyone for their testimony and held HB
315.
There being no further business to come before the committee,
Chair Huggins adjourned the meeting at 4:59:51 PM.
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