HJR 10-SUPPORTING ROAD BELT ELECTRICAL LINE  1:09:37 PM CO-CHAIR TARR announced that the next order of business would be HOUSE JOINT RESOLUTION NO. 10, Supporting development of the road belt electrical transmission line; and urging members of the Alaska delegation in Congress to pursue the development of this high- voltage electrical line in the interior of the state. [Before the committee was the committee substitute (CS) for HJR 10(ENE), reported out of the House Special Committee on Energy on 3/15/19.] REPRESENTATIVE TALERICO, sponsor of HJR 10, paraphrased from the following written sponsor statement [original punctuation provided]: The Development of the road belt electrical inter-tie transmission line would create a high-voltage electrical line running from Sutton to Glennallen, where a subtransmission line would extend to Gakona and on to Tok and north through the upper Tanana region to Delta Junction, and the final leg of the project would run from near Delta Junction, just south of Fort Greely, back to Gakona. This resolution supports infrastructure development for energy and national security, economic development, and natural resource development in the State of Alaska. The Trans Alaska Pipeline (TAPS) would benefit by using the low- cost energy provided by the transmission line in the operation of the pipeline and protection of its off- grid pump stations. A high-voltage electrical line would complete an electrical transmission bus loop and establish a second path for power transmission from Anchorage to Fairbanks which is needed during disasters such as earthquakes. With the infrastructure development and the increase in population at Eielson Air Force Base, Fort Greeley and Clear Air Force Station, the need for power in the region will increase significantly. This resolution urges Congress to advocate for the security of the nation's northernmost military and oil infrastructure by pursuing the development of the Road Belt Inter-tie. This is a project long overdue for Alaska and I ask for your support for this resolution. REPRESENTATIVE TALERICO continued, noting Alaska is becoming a national security stronghold for the U.S. as evidenced by an increased military presence in the state. He said he seeks to ensure a supply of power to military and other facilities in the Interior of Alaska. 1:14:40 PM JASON HOKE, President, Board of Directors, Copper Valley Development Association (CVDA), Alaska Regional Development Organizations, Division of Economic Development, Department of Commerce, Community & Economic Development (DCCED), and Program Director, Ahtna Inter-Tribal Resource Commission, directed attention to a PowerPoint presentation entitled, "Road Belt Inter-Tie." Mr. Hoke provided a short history of the Rail Belt Inter-Tie (RBIT), beginning in the late 1980s (slide 2). Phase 1 of the project would transmit 138-245 kilovolts (kV) of power from Sutton to Glennallen to Delta. Phase 2 would transmit power via a subtransmission line 227 miles from Gakona to Tok to Delta. Mr. Hoke noted the lines could utilize existing rights of way as there are already distribution powerlines running in the area with the exception of 100 miles. He explained completion of a "bus loop" of transmission lines around the road system of Interior Alaska is necessary to create redundancy in the event of an earthquake, an avalanche, or other power emergency. The project would electrify an area the size of Montana (slide 3). Slide 4 illustrated two maps of the current concept, one of which showed the project and connections to renewable energy resources and potential natural resource development opportunities. A smaller map showed the current Railbelt transmission line and phase 1 and phase 2 of the proposed project. Mr. Hoke stated the project has been studied and vetted; he provided a list of local utilities, local governments, state agencies, and Tribal organizations that are in strong support of the project (slide 5). 1:19:45 PM REPRESENTATIVE HANNAN asked for a description of the sources of current power generation, and levels of production, within the affected area. MR. HOKE explained the existing power generation sources of power beyond Sutton are primarily diesel-generated microgrids. Slide 6 listed additional support and resolutions in support of the project; he described how contacts were made with local communities. Slide 7 listed how current costs of power inhibit development; for example, electrical microgrids are expensive and consume approximately four million gallons of diesel fuel per year. Further, the Power Cost Equalization (PCE) program does not cover commercial or state and federal facilities; the University of Alaska Fairbanks power plant consumes 6,000 gallons of diesel fuel per hour. MR. HOKE turned to the topic of economic and natural resource development; he said cheaper electrical power expands business retention and expansion and he provided several examples of proposed manufacturing, mining, agricultural, and tourism opportunities currently prohibited by the cost of electricity (slide 8). Because energy is national security, military benefits include power to Alaska military bases and stations, redundancy and reliable energy, reduced costs, support for growth in defense installations, and compliance with the military guideline of 25 percent renewable power (slide 9). Mr. Hoke opined energy, transportation, and communication are necessary for infrastructure and Alaska's road system supplies transportation and communication, however, lower cost energy is lacking: new industry and economic development mean new revenue for the state; the legislature is the Interior's governing body; residents must choose between buying groceries and paying their electric bill; residents must choose between living at home or moving to cities (slide 10). To advance the project, $2 million is needed from the legislature for a reconnaissance engineer's study/report, after which the project would be submitted to state and federal agencies for funding (slide 11). 1:32:28 PM REPRESENTATIVE HANNAN questioned whether the project would be completely funded with federal funds and if the U.S. Department of Defense is "on board with this conceptually ...." MR. HOKE stated the majority of funding may come from the federal government; he referred to a letter to U.S. Senator Dan Sullivan included in the committee packet. In addition, there is interest from the Rural Utilities Service, Rural Development, U.S. Department of Agriculture, the U.S. Department of Energy, and the U.S. Department of Commerce. REPRESENTATIVE HANNAN surmised Sutton is the starting point because the existing transmission lines end there. MR. HOKE affirmed the transmission line from Matanuska Electric Association, Inc. (MEA) ends in Sutton. In response to Representative Rauscher, he said the reconnaissance engineer's study/report would define the location of the start of the transmission line. REPRESENTATIVE SPOHNHOLZ questioned whether the next step is to obtain funding for the project subsequent to passage of HJR 10. MR. HOKE advised he is working to obtain $2 million in state or federal funding for the reconnaissance engineer's study/report; in fact, HJR 10 would remind Alaska's congressional delegation and federal agencies that most of the Lower 48 has benefitted from years of federal funding for infrastructure prior to 1959. In further response to Representative Spohnholz, he said he has met with Alaska's congressional delegation. 1:39:16 PM REPRESENTATIVE SPOHNHOLZ asked whether there is any opposition to the project from affected communities. MR. HOKE acknowledged there has been some opposition to details of the project; for example, residents of Sutton would prefer the underground installation of transmission lines. He opined these are mitigating issues and not opposition to the project. REPRESENTATIVE RAUSCHER confirmed Sutton residents want the transmission line installed underground following the existing line; he stated his support for HJR 10. 1:43:16 PM JOHN DUHAMEL, Chief Executive Officer, Copper Valley Electric Association, provided a PowerPoint presentation entitled, "Road Belt Intertie (RBIT) Concept." He said the Road Belt Intertie (RBIT) would benefit the power utilities and the isolated power grids along the Richardson Highway. Mr. Duhamel explained moving electricity includes distribution power and transmission power. Distribution power are lower voltages moved to residential, commercial, and industrial customers and managed by a power utility. Transmission and sub-transmission power are high voltages moved between communities and managed by utilities or the state. The proposed project is a transmission and sub- transmission project that would be managed by the state. He stressed transmission, similar to airports and roads, is infrastructure (slide 2). MR. DUHAMEL continued to slide 3 - which was an illustration of an electric power system overview - and described expenses associated with high voltage transmission. Slide 4 listed the power principles of a grid, which is a system of wires, structures and substations: a bigger grid is more resilient and can absorb interruptions caused by a falling tree or fluctuations from renewable energy sources such as wind and solar; a grid set in a loop can move power in any direction; a bigger grid is economical for all users. Mr. Duhamel advised RBIT is not a new concept and was studied by the Alaska Energy Policy Task Force in 2003 (slide 5). Slide 6 was a map of the region that would benefit from RBIT. Currently, the region is supplied by isolated grids, or there is no power; most available power is produced by fossil fuel. 1:50:46 PM REPRESENTATIVE HANNAN asked whether any of the existing isolated grids produce excess power. MR. DUHAMEL said some produce surplus power, but it is not cheap; for example, Copper Valley Electric Association (CVEA) has additional capacity generated by diesel, and a slight overage of hydropower in the summer. If RBIT were built, CVEA could provide hydropower to more customers and could also connect with excess power generated by natural gas. REPRESENTATIVE HANNAN questioned whether Chickaloon Wind, Five Mile Hydro, Chitina Wind, and Gulkana Pellet Mill were currently producing power. MR. DUHAMEL expressed his understanding they are isolated grids that are producing power. He then summarized RBIT key points from the power utility point of view (slide 7): a larger grid is better for all; capacity available to more customers; connect isolated grids; improved reliability; allow more renewable energy and other sources of energy; provide more choice for customers. Mr. Duhamel stated the power utility industry supports HJR 10 for the following reasons: gives credibility to RBIT; informs Alaska's congressional delegation and the federal government; allows more renewable opportunity; supports a request for federal funds; revitalizes RBIT; seeks federal infrastructure funds. He concluded there is renewed interest in RBIT because federal money for infrastructure may become available. 1:56:39 PM REPRESENTATIVE HANNAN asked whether transmission lines can be buried. MR. DUHAMEL advised there are many methods that would be studied; however, in Alaska, power utilities prefer above ground lines because of permafrost and winter maintenance. The technology to bury transmission lines is available and has been used in the Lower 48. CO-CHAIR TARR referred to forthcoming changes to the existing Railbelt grid and asked whether RBIT and the Railbelt would be integrated into "a statewide plan" or whether the grid would thereby become too big to maximize efficiencies. MR. DUHAMEL restated a bigger grid is better; however, it is necessary to have an entity managing the power to obtain the lowest cost and he gave an example. CO-CHAIR TARR asked if there are geographic limitations to transmitting power. MR. DUHAMEL acknowledged a very large grid has minimal line loss. Further, the volume of kilowatt hour use is more important than the number of customers to affect economy of scale. REPRESENTATIVE SPOHNHOLZ asked for clarification of the project's connection to the Railbelt system. MR. DUHAMEL further explained the Railbelt loop would be from Delta to Fairbanks to Palmer to Sutton; the RBIT loop would continue from Sutton back to Delta. 2:06:29 PM CO-CHAIR TARR opened public testimony on HJR 10. 2:06:37 PM CRYSTAL ENKVIST, Executive Director, Alaska Power Association (APA), informed the committee APA is the statewide electric utility trade association. She expressed APA's strong support for an electric transmission infrastructure. The transmission line project proposed by the Copper Valley Electric Association and others would connect to the Railbelt transmission grid and would increase Alaska's electric system reliability, allow for the integration of sources of renewable energy, provide an alternate route for power, and create economic opportunities in the greater Copper Valley region. Ms. Enkvist said APA supports RBIT and analysis of transmission infrastructure options. 2:08:33 PM CO-CHAIR TARR, after ascertaining no one further wished to testify, closed public testimony. HJR 10 was held over.