HJR 8-FEDS ALLOW STATE TO MAKE ENERGY CHOICES  10:18:08 AM CO-CHAIR COLVER announced that the first order of business would be HOUSE JOINT RESOLUTION NO. 8, Urging the federal government to empower the state to protect the state's access to affordable and reliable electrical generation. 10:18:18 AM REPRESENTATIVE TILTON moved to adopt the proposed committee substitute (CS) for HJR 8, labeled 29-LS0401\H, Nauman, 2/16/15, as the working draft. There being no objection, Version H was before the committee. 10:19:18 AM JOSHUA BANKS, Staff, Representative David Talerico, Alaska State Legislature, on behalf of Representative Talerico, summarized the changes to HJR 8 in Version H, beginning with a title change to add a statement urging the federal government to exempt the state from the Clean Power Plan (CPP). On page 1, lines 12 and 13 were added which read: WHEREAS the state has joined with other states in asserting that the Clean Power Plan is unlawful and, in comprehensive comments, has asked to be exempt; and MR. BANKS said on page 2, lines 2 and 3 were added which read: WHEREAS the application of the goals of the Clean Power Plan to the state is fundamentally flawed because the goals rely on interconnection with the North American grid, to which the state is not connected; and MR. BANKS said on page 2, lines 17-22 were added which read: WHEREAS renewable energy and energy efficiency measures have been implemented at significant cost to the state, but will not be credited to the carbon goal of the state; and WHEREAS the Clean Power Plan will require the premature retirement of the Healy Unit 1 coal plant, underutilization or premature retirement of the Healy Unit 2 coal plant, and significant new investment in renewable energy and energy efficiency; and MR. BANKS said the BE IT RESOLVED language beginning on page 2, line 28, was changed to include exemption for Alaska to the Clean Power Plan, and on page 2, line 10, the original language was changed from "a one and one-half percent cap on electricity" to "minimal electrical." Finally, added to the distribution list were Gina McCarthy, Administrator of the U.S. Environmental Protection Agency and Janet McCabe, Acting Assistant Administrator for the Office of Air and Radiation. 10:22:40 AM CO-CHAIR COLVER confirmed that public testimony was open on HJR 8. 10:23:23 AM NORMAN ROKEBERG, Commissioner, Regulatory Commission of Alaska (RCA), informed the committee CPP is a change to section 111(d) of the Clean Air Act. In December of last year a taskforce, led by the state administration and its agencies, delivered formal comments to the U. S. Environmental Protection Agency (EPA) requesting an exemption from CPP rules while concurrently supporting legal action to find said rules unlawful. Mr. Rokeberg appreciated the legislature's attention to this issue which holds the potential for impacts to ratepayers and a potential shift of power reserved for the states to the federal government. The taskforce requested an exemption to CPP from EPA because Alaska is not connected to the North American grid, there were inaccurate calculations by EPA, there would be increased cost to Railbelt consumers, and there was a failure to recognize Alaska's investment in efficiency, which is approaching $1 billion. He advised that CPP rules would require Alaska to focus on electrical efficiency instead of thermal efficiency, which is more appropriate given the climate of the state. Finally, he opined CPP would force the closure of one or both of the Healy coal plants. Mr. Rokeberg concluded that EPA wants "the people of the North Star Borough to sit in a dimly- lit room, a cold dimly-lit room, at the end of a 350 mile extension cord." 10:27:06 AM MR. ROKEBERG directed attention to Version H, page 2, lines 5 and 6 which read: WHEREAS the Regulatory Commission of Alaska should be empowered to make decisions with methodology based on the lowest production costs for electrical generation; MR. ROKEBERG expressed his belief that the foregoing does not recognize the authority in how RCA conducts its business; in fact, to ensure the lowest production cost, RCA would need citing authority in generation. Also, the language questions the use of economic dispatch, and he noted generation is not in the purview of RCA. He urged the committee to consider language he had previously suggested in this regard. Further, on page 2, line 10 states the obvious. Also on page 2, line 13 read: WHEREAS the state needs coal-fired power plants to ensure the reliability of the electrical energy grid; and MR. ROKEBERG questioned the veracity of this statement. Also on page 2, lines 15 and 16 read: WHEREAS the loss of other traditional electrical generation methods may cause natural gas plants to be overused or used in ways that exceed their engineered design; and MR. ROKEBERG advised the foregoing is a generalized statement that applies to the generation capacity in the Lower 48; in Alaska, natural gas plants are new and efficient, and he suggested deletion. REPRESENTATIVE CLAMAN asked whether Mr. Rokeberg supported HJR 8 as currently drafted. MR. ROKEBERG responded he would like to see some changes, which could be made in the next committee of referral. [Public testimony was treated as closed.] REPRESENTATIVE TALERICO stated his preference to move HJR 8 out of committee. 10:32:31 AM REPRESENTATIVE TILTON moved to report CSHJR 8, Version 29- LS0401\H, Nauman, 2/16/15, out of committee with individual recommendations and no fiscal note. There being no objection, CSHJR 8(ENE) was reported from the House Special Committee on Energy. [The forthcoming zero fiscal note, Identifier: HJR 8 HENE FN 1, was reported out of the House Special Committee on Energy on 2/19/15.] 10:32:50 AM The committee took an at ease from 10:32 a.m. to 10:35 a.m.