HB 357-AIDEA SUSTAINABLE ENERGY PROGRAM  3:12:03 PM CO-CHAIR FOSTER announced that the next order of business would be HOUSE BILL NO. 357, "An Act establishing the sustainable energy transmission and supply development program in the Alaska Industrial Development and Export Authority." 3:12:20 PM REPRESENTATIVE SADDLER moved to adopt the proposed committee substitute (CS) for HB 357, Version 27-LS1402\M as the working document. There being no objection, Version M was adopted. 3:12:28 PM REPRESENTATIVE SADDLER moved to adopt the fiscal note identified as HB357-DCCED-AIDEA-03-02-12. There being no objection, the fiscal note was adopted. 3:13:18 PM CO-CHAIR LANCE PRUITT, Alaska State Legislature, speaking as the prime sponsor, introduced HB 357, saying the bill is a companion bill to SB 25 - sponsored by Senator Lesil McGuire - and ensures that credit is available by empowering the Alaska Industrial Development & Export Authority (AIDEA), Department of Commerce, Community & Economic Development, to finance, or facilitate the financing of, energy projects through the Sustainable Energy Transmission and Supply (SETS) development fund. Relying on credit ensures project sponsors have a stake in the project's success or failure. Moreover, it would keep the state's investments in Alaska growing the economy. Currently, Alaska's savings are invested in stocks and bonds that drive economic activity outside of Alaska; however, HB 357 proposes that a portion of those savings are invested in Alaska - through AIDEA - as loans for energy infrastructure. As each loan is repaid, the capital becomes available for new loans that could be offered, for example, for financing energy infrastructure in the Railbelt. Without this legislation, debt interest repayment by Alaska utilities will continue to leave the state. Dividends paid by AIDEA are between $20 million and $30 million per year, but a larger balance sheet would increase AIDEA's earnings and its dividends to the state. Representative Pruitt concluded that HB 357 will put local assets to work to create opportunities, develop resources, and create a sustainable economy for the future. 3:15:48 PM DIRK CRAFT, staff to Representative Lance Pruitt, Alaska State Legislature, speaking on behalf of Representative Pruitt, sponsor, presented a sectional analysis of the proposed CS for HB 357. He began with section 1, which is the short title: the Alaska Sustainable Strategy for Energy Transmission and Supply (ASSETS) Act. Section 2 states the legislative intent to appropriate in future years. Section 3 amends the legislative findings and policy that created AIDEA to include energy enterprises, and amends the following language for consistency. Section 4 adds "energy" to the list of enterprises in the AIDEA policy declaration. Section 5 replaces "a power transmission intertie" with "an energy project," and amends the following language for consistency. Section 6 replaces "a power transmission intertie" with "an energy project," and adds "loans for improvements and energy efficiency" to the list of loans that may be purchased by AIDEA. Section 7 replaces "a power transmission intertie" with "an energy project." Sections 8-12 clarify that interest rates apply to the new fund created by the bill, and ensure that the interest rates are consistent with current practice and that AIDEA is collecting interest on its investments. These sections also ensure that the loans made by AIDEA conform to the private sector. Section 13 adds "renewable energy development" to the list of types of projects that qualify for loan participation. Section 14 creates the Sustainable Energy Transmission and Supply program. Section 15 defines "development fund" and "energy project." Section 16 instructs the revisor of statutes. 3:18:21 PM REPRESENTATIVE PETERSEN asked whether adding "energy" and removing "power transmission intertie" means that an intertie no longer qualifies for financing from AIDEA. MR. CRAFT advised that the new language includes both, and is a broader definition. 3:19:29 PM CO-CHAIR PRUITT added that the definition of energy projects is found on page 11, lines 3-11, of the bill. CO-CHAIR FOSTER held over HB 357. 3:19:32 PM