HOUSE BILL NO. 152 "An Act establishing a renewable energy fund and describing its uses and purposes." CHARISSE MILLET, STAFF, SPEAKER JOHN HARRIS, sponsor, explained the purpose behind HB 152. The high cost of fuel in Alaska has made it increasingly difficult for Alaskan residents to prosper. Home heating fuel and gasoline prices have skyrocketed in recent years leaving some Alaska families, who already struggle to make ends meet, left to prioritize between basic necessities of life: heat, food, or health care. The bill contains recommendations from the Alaska Energy Policy Task Force formed in 2003. With the bill, Alaska would be one of 40 states to institute a policy on renewable energy. Ms. Millet reported that the bill accomplishes two things: provides for a revolving loan fund under the Alaska Energy Authority (AEA) and has a grant component. There is currently no funding mechanism for the fund. The bill seeks only to establish the fund in statute. 2:33:37 PM KACI SCHROEDER-HOTCH, STAFF, REPRESENTATIVE THOMAS, co- sponsor, explained the sections of the bill. She mentioned that a natural gas project could also qualify for a grant. She explained the makeup of the advisory committee. 2:36:38 PM SARAH FISHER-GOAD, DEPUTY DIRECTOR OF OPERATIONS, ALASKA ENERGY AUTHORITY, testified in support of HB 152. She spoke of the intentions of the renewable energy fund. She suggested an amendment which would allow the Department of Revenue to be the investment manager of the new fund. 2:38:14 PM CHRIS ROSE, EXECUTIVE DIRECTOR, RENEWABLE ENERGY ALASKA PROJECT (REAP), testified in support of HB 152. He explained that there are no fuel costs related to generating renewable energy. The bill would create a fund similar to ones in 15 other states, and will attract capital to the state. KATHERINE LAMAL, VICE PRESIDENT OF POWER, GOLDEN VALLEY ELECTRIC ASSOCIATION, testified in support of the legislation, which would help jumpstart renewable energy in Alaska and show that Alaska is a forward-looking state. 2:41:27 PM CONNIE FREDENBERG, COMMUNITY DEVELOPMENT, ALEUTIAN PRIBILOF ISLANDS ASSOCIATION (APIA), testified in support of the legislation. She noted that the Aleutian Islands have had renewable energy for the past four years. She maintained that the technology exists and that much of Alaska could benefit from renewable resources. Displacing diesel fuel with renewable resources is a long-term solution. She stressed the need for the political will to make it happen. She maintained that establishing a renewable grant fund would benefit all of Alaska. 2:44:15 PM MEERA KOHLER, PRESIDENT & CEO, ALASKA VILLAGE ELECTRIC COOPERATIVE, testified in support of the legislation. She provided examples of renewable resources used in the villages. She maintained that Alaska has a large potential for renewable resources. Representative Kelly expressed concern that the members of the advisory committee would end up gridlocked most of the time. Ms. Kohler explained that the committee has great potential, is small, and workable. The committee is needed to focus on renewable resources. 2:48:35 PM GWEN HOLDMANN, VICE PRESIDENT OF NEW DEVELOPMENT, CHENA HOT SPRINGS RESORT, testified in support of the legislation. She noted that their power plant has won awards. She reported that in seven months, they were able to offset $280,000 in diesel fuel costs. She provided other details of their use of renewable resources and the resulting savings. She observed that they would not have been able to make the advances without grant funding. 2:51:47 PM Co-Chair Meyer MOVED to ADOPT Amendment 1: Page 3, line 19 After "balance" Insert "of" There being NO OBJECTION, it was so ordered. Representative Thomas MOVED to ADOPT Amendment 2: Page 3, line 17: Delete "and" Page 3, line 20, following "section": Insert "; and (4) apply for and be able to receive contributions from other sources for distribution as grants to eligible applicants" Representative Crawford noted that other funding sources are available for renewable energy systems. 2:56:49 PM Ms. Millet explained that there is nothing in the bill that prohibits AEA from seeking other funding. Some fund sources are weighted higher than others due to the possibility of matching funds. Representative Crawford emphasized the wording "apply for" in the amendment. He agreed that there is nothing in the bill that would prevent that, but there is also nothing that states that "they should" apply for other sources of funds. Representative Thomas said he has no problem with Amendment #2. 2:58:22 PM Representative Hawker asked if Speaker Harris would agree with Amendment #2. Ms. Millet said he would have no problem with it. Co-Chair Meyer WITHDREW his objection. There being NO OBJECTION, Amendment #2 was adopted. Representative Thomas MOVED to ADOPT Amendment #3: Page 5, lines 14-17 Delete after (g): [as applicable to licensing water- power development projects, unless the authority adopts a different definition based on a determination made by a nationally recognized independent nonprofit corporation that considers the environmental effects of hydropower practices;] Co-Chair Meyer OBJECTED. Representative Thomas pointed out that the amendment would keep the definition as defined under AS 42.45.350(g). Ms. Millet said the sponsor has no objection to the amendment. Co-Chair Meyer WITHDREW his objection. There being NO OBJECTION, it was so ordered. 2:59:57 PM Representative Thomas MOVED to ADOPT Amendment # 4: Page 3, line 9 Add: (4) investments to be managed by the Department of Revenue Co-Chair Meyer OBJECTED. Representative Thomas explained that the amendment was at the recommendation of Ms. Fisher-Goad from AEA. Ms. Millet agreed with the amendment. Co-Chair Meyer WITHDREW his objection. There being NO OBJECTION, Amendment #4 was adopted. Co-Chair Meyer questioned fiscal note #2. He thought $126,000 should be general fund money rather than renewable energy fund money. Ms. Millet did not have a problem with that. 3:03:47 PM Representative Hawker mentioned that either the account or the fund will require a separate appropriation before there is any money available. He suggested that both fiscal notes be indeterminate, rather than a fixed number. Ms. Millet suggested consulting with AEA about the fiscal notes. Representative Kelly commented that the full-time position is not needed. He agreed with Representative Hawker. Co-Chair Meyer thought both fiscal notes should be indeterminate fiscal notes. Ms. Millet agreed. Ms. Fisher-Goad explained that the reason for the amount under the renewable energy fund was because of the assumption that there would be an appropriation to make the program move forward. She said she would comply with the will of the committee. Representative Hawker spoke about travel, which he thought AEA could absorb. 3:09:55 PM Representative Hawker MOVED that Fiscal Notes #1 and #2 be indeterminate. There being NO OBJECTION, it was so ordered. Co-Chair Meyer wanted to move the bill. Representative Hawker stated willingness to move the bill, but emphasized that this legislation is no assurance for funding for the program. Representative Crawford spoke in support of moving the bill and finding private sources of money to fund it. Representative Thomas agreed to move the bill and find funding later. 3:13:00 PM Representative Hawker MOVED to REPORT CSHB 152 (FIN), as amended, with individual recommendations and with the accompanying amended fiscal notes. There being NO OBJECTION, it was so ordered. CSHB 152 (FIN) was REPORTED out of Committee with a "do pass" recommendation and with two new indeterminate fiscal notes by the Department of Commerce, Community and Economic Development. 3:13:59 PM