ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ENERGY
March 31, 2009
3:03 p.m.
MEMBERS PRESENT
Representative Bryce Edgmon, Co-Chair
Representative Charisse Millett, Co-Chair
Representative Kyle Johansen
Representative Jay Ramras
Representative Pete Petersen
Representative Chris Tuck
MEMBERS ABSENT
Representative Nancy Dahlstrom
COMMITTEE CALENDAR
HOUSE BILL NO. 196
"An Act relating to the alternative energy revolving loan fund;
and providing for an effective date."
-MOVED CSHB 196(ENE) OUT OF COMMITTEE
HOUSE BILL NO. 166
"An Act relating to the Southeast energy fund."
-MOVED OUT OF COMMITTEE
HOUSE BILL NO. 66
"An Act relating to net energy metering for retail electricity
suppliers and customers."
-HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 196
SHORT TITLE: ALTERNATIVE ENERGY REVOLVING LOAN FUND
SPONSOR(s): ENERGY
03/23/09 (H) READ THE FIRST TIME - REFERRALS
03/23/09 (H) ENE, FIN
03/31/09 (H) ENE AT 3:00 PM BARNES 124
BILL: HB 166
SHORT TITLE: SOUTHEAST ENERGY FUND
SPONSOR(s): THOMAS
03/02/09 (H) READ THE FIRST TIME - REFERRALS
03/02/09 (H) ENE, FIN
03/31/09 (H) ENE AT 3:00 PM BARNES 124
BILL: HB 66
SHORT TITLE: NET ENERGY METERING
SPONSOR(s): SEATON, AUSTERMAN, GATTO, RAMRAS, MUNOZ, WILSON,
BUCH
01/20/09 (H) PREFILE RELEASED 1/16/09
01/20/09 (H) READ THE FIRST TIME - REFERRALS
01/20/09 (H) ENE, L&C
03/31/09 (H) ENE AT 3:00 PM BARNES 124
WITNESS REGISTER
ADAM BERG, Staff
Representative Bryce Edgmon
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented HB 196 on behalf of the House
Special Committee on Energy.
GREG WINEGAR, Director
Division of Investments
Department of Commerce, Community, & Economic Development
(DCCED)
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
196.
REPRESENTATIVE BILL THOMAS
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Spoke as the sponsor of HB 166.
KACI SCHROEDER-HOTCH, Staff
Representative Bill Thomas
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
166.
ROBERT VENABLES, Energy Coordinator
Southeast Conference
Juneau, Alaska
POSITION STATEMENT: Testified in support of HB 166.
REPRESENTATIVE PAUL SEATON
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As one of the joint prime sponsors,
presented HB 66.
DAVID GARDNER, Vice President
Marketing & Member Services
Golden Valley Electric Association (GVEA)
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition to HB 66.
MARILYN LELAND, Executive Director
Alaska Power Association (APA)
Anchorage, Alaska
POSITION STATEMENT: Testified in opposition to HB 66.
PHIL STEYER, Director
Government & Corporate Communications
Chugach Electric Association, Inc. (CEA)
Anchorage, Alaska
POSITION STATEMENT: Testified in opposition to HB 66.
ROBERT REAGAN, Representative
Municipal Light & Power (ML&P)
Municipality of Anchorage
Anchorage, Alaska
POSITION STATEMENT: Testified in opposition to HB 66.
ACTION NARRATIVE
3:03:01 PM
CO-CHAIR BRYCE EDGMON called the House Special Committee on
Energy meeting to order at 3:03 p.m. Representatives Johansen,
Petersen, Tuck, Ramras, and Edgmon were present at the call to
order. Representative Millett arrived as the meeting was in
progress.
HB 196-ALTERNATIVE ENERGY REVOLVING LOAN FUND
CO-CHAIR EDGMON announced that the first order of business would
be HOUSE BILL NO. 196, "An Act relating to the alternative
energy revolving loan fund; and providing for an effective
date."
3:04:10 PM
ADAM BERG, Staff to Representative Bryce Edgmon, Alaska State
Legislature, presented HB 196 on behalf of the House Special
Committee on Energy. Mr. Berg stated HB 196 takes the
Alternative Energy Revolving Loan Fund, established in 1978, and
makes changes to the existing statute by eliminating the "sweep"
provision; changing the loan rates; and repealing the transfer
or sale of mortgages and notes. Further, the bill adds language
to take advantage of capitalization opportunities and adds high
efficiency wood pellet stoves to the definition of alternative
energy systems. Mr. Berg noted that the fund has been inactive
since the 1990s when the balance of the fund was transferred to
the general fund (GF).
3:05:36 PM
CO-CHAIR EDGMON added that HB 196 is House Special Committee on
Energy proposed legislation. The bill was crafted after
hearings in rural communities where the committee discovered a
need for low interest rate loans to individuals for improvements
to energy [efficiency] infrastructure.
3:06:08 PM
REPRESENTATIVE PETERSEN asked for the existing balance in the
fund.
MR. BERG said there is a zero balance in the fund as any
payments due the fund are swept into the GF at the end of each
fiscal year.
REPRESENTATIVE PETERSEN surmised then that the plan is to create
a revolving fund.
MR. BERG replied yes.
3:07:20 PM
GREG WINEGAR, Director, Division of Investments, Department of
Commerce, Community, & Economic Development (DCCED), informed
the committee his agency administered the program from the late
1970s until 1987. During that time, 2,900 loans were made until
the changes by the legislature in 1990; in fact, there is a
small balance in the account now, but no new loans have been
made since 1987. Mr. Winegar opined HB 196 would allow the
program to operate again with the aforementioned changes. In
response to Co-Chair Edgmon, Mr. Winegar said the proposed
interest rate would be prime plus 1 percent, with a floor 5
percent and a ceiling of 8 percent. As the prime rate changes
the fixed rate would change between the cap and the floor. The
requirements for collateral are a deed of trust against the
residence receiving the improvements. He explained that one of
the amendments proposes the deletion of the requirement for a
first deed of trust; he suggested the program should continue
with a lien against the property, but not necessarily a first
lien.
3:10:43 PM
CO-CHAIR EDGMON identified Mr. Winegar's description of the
amendment as conceptual Amendment 1, that deletes "first" from
page 1, line 12, of the bill. He then offered the amendment for
the purpose of discussion.
3:11:35 PM
MR. WINEGAR stated conceptual Amendment 2 would amend AS
45.88.020(a) such that the energy systems must be located in the
state.
3:12:19 PM
REPRESENTATIVE JOHANSEN called attention to page 2, line 4, of
the bill and asked whether it was appropriate to specify the
Wall Street Journal in the statute.
MR. WINEGAR said the language is patterned after existing
statutory language; however, he agreed with Representative
Johansen's point.
3:13:07 PM
REPRESENTATIVE JOHANSEN then asked about the addition of high
efficiency wood pellet stoves and for the definition of
"unprocessed wood."
MR. BERG explained that the addition of high efficiency wood
pellet stoves denotes that a normal wood stove does not qualify
for the program. He was unsure of the reason for the change
from "wood" to "unprocessed wood".
REPRESENTATIVE JOHANSEN asked Mr. Berg to investigate this
change because his constituents are providing firewood from
timber sales; in fact, he will require more specific definitions
at later hearings.
CO-CHAIR EDGMON offered to have his staff investigate.
3:15:45 PM
REPRESENTATIVE TUCK recalled demonstrations of a soapstone stove
and a wood-fired furnace in Dillingham. He asked whether the
proposed provision would exclude these projects.
CO-CHAIR EDGMON opined the Dillingham projects would not be
excluded.
MR. BERG said he was unsure.
CO-CHAIR EDGMON expressed the intent of the sponsors to use the
term wood; however, the drafter used the term unprocessed wood.
3:17:13 PM
REPRESENTATIVE JOHANSEN called attention to page 2, lines 19-22,
of the bill and noted the reference to wood stoves with
catalytic converters, and steam, hot water, or ducted hot air
central heating system that uses wood or coal for fuel. He
opined these were the devices viewed in Dillingham, and restated
his interest in the legal definition of the term unprocessed
wood.
3:17:52 PM
REPRESENTATIVE TUCK stressed the inclusion of the soapstone
stove.
3:18:18 PM
CO-CHAIR MILLETT opined the soapstone stove is covered under the
language referring to a ducted hot air central heating system.
REPRESENTATIVE TUCK confirmed the intention of the proposed
legislation to exclude "just any old wood stove" from
qualifying.
MR. BERG agreed.
3:19:17 PM
CO-CHAIR MILLETT moved Amendment 1, labeled 26-LS0754\R.1, Kane,
3/31/09, which read:
Page 1, line 12:
Delete "first"
REPRESENTATIVE PETERSEN objected for discussion purposes, and
related his understanding of Amendment 1.
MR. WINEGAR restated Amendment 1 allows for a second deed of
trust.
3:20:34 PM
REPRESENTATIVE PETERSEN withdrew his objection. There being no
further objection, Amendment 1 was adopted.
3:20:40 PM
CO-CHAIR MILLETT moved Amendment 2, labeled 26-LS0754\R.2, Kane,
3/31/09, which read:
Page 1, following line 9:
Insert a new bill section to read:
"*Sec. 2. AS 45.88.020(a) is amended to read:
(a) The department may
(1) make loans for the
purchase, construction, and installation of
alternative energy systems that are located in
the state;
(2) adopt regulations
necessary to carry out the provisions of AS
45.88.010 - 45.88.090, including regulations to
establish reasonable fees for services provided
and charges for collecting the fees;
(3) collect the fees and
collection charges established under this
subsection."
Renumber the following bill sections accordingly.
CO-CHAIR EDGMON objected.
MR. WINEGAR restated that Amendment 2 clarifies that the
projects are located in Alaska.
CO-CHAIR EDGMON withdrew his objection. There being no further
objection, Amendment 2 was adopted.
3:21:36 PM
CO-CHAIR MILLETT moved to report HB 196, 26-LS0754\R, as
amended, out of committee with individual recommendations and
the accompanying zero fiscal notes. There being no objection,
CSHB 196(ENE) was reported from the House Special Committee on
Energy.
3:22:17 PM
The committee took an at-ease from 3:23 p.m. to 3:25 p.m.
3:25:38 PM
HB 166-SOUTHEAST ENERGY FUND
CO-CHAIR EDGMON announced that the next order of business would
be HOUSE BILL NO. 166, "An Act relating to the Southeast energy
fund."
3:26:34 PM
REPRESENTATIVE BILL THOMAS, Alaska State Legislature, speaking
as the sponsor of HB 166, paraphrased from the following written
sponsor statement:
In 1993 the Alaska State Legislature established the
Southeast Energy Fund as a holding tank for money that
could then later be used and appropriated to the Swan
Lake-Tyee Hydroelectric Project. Since then, the need
and fervor for hydroelectric power in Southeast Alaska
has grown. Hydroelectric power is the most readily
available source of renewable energy in Southeast.
Some people refer to Southeast as the Saudi Arabia of
renewable. However, despite this source of renewable
energy, most communities in Southeast Alaska remain
heavily dependent upon diesel generated electricity.
REPRESENTATIVE THOMAS related the highest rate for electricity
is $.83 per kilowatt, before Power Cost Equalization (PCE), with
an average of $.58 per kilowatt. He opined the high cost of
electricity has crippled communities. House Bill 166 broadens
the authority of the Southeast Energy Fund to include all power
projects within Southeast Alaska. In fact; it allows for a
funding mechanism for the construction of power generation
projects in Southeast and for the completion of the regional
electrical intertie. Representative Thomas pointed out Haines
has an intertie with Skagway; however, there is a 3-5 percent
growth in the demand for electricity each year. He acknowledged
that regions of the state compete for funds and stressed that
regional pools of funds are best.
3:31:18 PM
REPRESENTATIVE TUCK called attention to page 1, line 12, of the
bill and asked for an explanation of the reference to "the
authority."
3:31:44 PM
KACI SCHROEDER-HOTCH, Staff to Representative Bill Thomas,
Alaska State Legislature, informed the committee the authority
referred to is the Alaska Energy Authority (AEA).
3:32:20 PM
ROBERT VENABLES, Energy Coordinator, Southeast Conference,
related his organization's support for HB 166, as it is a timely
bill that will continue the progress in the development of
natural resources in Southeast Alaska. He compared the bill
with the Railbelt Energy Fund and said the bill would catch
Southeast Alaska up with the Railbelt. Mr. Venables noted that
the projects in the region will be costly, regardless of the
investments that have been made in renewable energy. With the
Congressional authorization of $384 million, there are vehicles
that may bring funding into Southeast Alaska thus the need for a
funding mechanism. He opined the needs of the system are for
transmission lines for the intertie, and the development of
capacity of other facilities along the intertie system. The
total estimated cost for the planned projects in the region is
in excess of $1 billion. He concluded the funding mechanism for
these projects has always eluded his organization, and that is
one reason Southeast Alaska is not ready when funds are
available. Mr. Venables continued to explain that Southeast
communities have worked together to forge a vision to develop
their renewable resources into a regional electrical system, and
HB 166 could be the mechanism that could facilitate this
mission.
3:36:29 PM
REPRESENTATIVE JOHANSEN asked whether the reference to
hydroelectric projects on page 1, line 14, of the bill also
includes interties.
MS. SCHROEDER-HOTCH understood interties are included; however,
if not, interties would be included in paragraph (2).
3:37:39 PM
REPRESENTATIVE TUCK confirmed that the bill allows options for
other funds to enter the fund, and that the [AEA] will be able
to administer the funds as needed. Furthermore, the funds can
be invested in other projects in the region.
MS. SCHROEDER-HOTCH concurred.
3:38:28 PM
CO-CHAIR EDGMON, upon determining no one else wished to testify,
closed public testimony.
3:38:54 PM
REPRESENTATIVE JOHANSEN moved to report HB 166, 26-LS0689\R, out
of committee with individual recommendations and the
accompanying zero fiscal notes. There being no objection, HB
166 was reported from the House Special Committee on Energy.
3:39:20 PM
The committee took an at-ease from 3:39 p.m. to 3:40 p.m.
3:40:58 PM
HB 66-NET ENERGY METERING
CO-CHAIR EDGMON announced that the final order of business would
be HOUSE BILL NO. 66, "An Act relating to net energy metering
for retail electricity suppliers and customers."
3:41:06 PM
REPRESENTATIVE PAUL SEATON, Alaska State Legislature, speaking
as one of the joint prime sponsors of HB 66, informed the
committee the bill will promote alternative energy use by
establishing a net metering policy for Alaskan utilities. He
explained that net metering is a measurement of the difference
between electricity purchased from a utility, and electricity
produced from a customer's private generating equipment. Home
and business owners who install renewable energy equipment, such
as solar panels or windmills, get to use their own electricity
and will receive a credit for their excess energy generation.
The credit is in kilowatt hours and reduces the customers'
electrical billing the following months. This "carry forward"
of credits from renewable energy generation allows the customer
to harvest excess energy during peak renewable production times,
such as the summer for solar, or wind in winter, and benefit
from this production during the following months. A net
metering policy encourages private investment by allowing a
customer/generator to calculate the pay-down of their equipment
cost through the calculation of the potential annual solar,
wind, or hydro production. Representative Seaton stressed the
importance of this concept in encouraging individuals to invest
in capital projects, as they can estimate their costs on an
annual basis. He then explained how the utilities will benefit
under this legislation: Utilities can gain about 10 percent in
sales from distributed generation as there is little line loss
to the point of sale, although the utility charges for an
anticipated line loss of 7 percent.
REPRESENTATIVE SEATON then reviewed the document entitled "HB 66
provisions and rationale." The bill allows a
customer/generator to have a renewable energy system producing
up to 25 kilowatts. Participation in net metering can reach up
to 1 percent of the retail system peak demand. Moreover, a
utility may limit net metering installations due to special
circumstances such as long transmission lines.
3:48:33 PM
REPRESENTATIVE SEATON continued to explain that the bill allows
a customer/generator to receive a credit of kilowatt hours if
they generate more electricity than they consume. He clarified
that the receipt of a kilowatt hour credit is not considered a
business transaction by the Internal Revenue Service (IRS) thus
potential problems are avoided. Customers of a small utility,
that generates fewer than one million kilowatts per year, may
vote to exempt the utility from the provisions of the bill. A
default uniform statewide utility interconnection standard is
established by the bill. Furthermore, HB 66 prohibits
additional fees for net metering. The bill does not prohibit a
utility from concurrently offering a Sustainable Natural
Alternative Program (SNAP) to its customers nor does it prevent
negotiations between a utility and a customer/generator for an
individual power purchase agreement for excess customer power
generation.
3:54:46 PM
REPRESENTATIVE SEATON opined the legislature has been proactive
in exploring alternative energy and renewable energy, but has
focused on the scale of programs for utilities; this legislation
is for individuals who wish to support renewable energy by
investing in their own systems and contributing to the
generation of electricity. He then described three proposed
amendments.
3:56:05 PM
REPRESENTATIVE SEATON offered an amendment to page 2, line 21,
that inserts a new (d) which read:
(d) A customer-generator owns the tax credits
associated with the equipment and renewable energy
credits associated with the electricity it generates.
"Renewable energy credit" is a tradable instrument
that includes all renewable and environmental
attributes associated with the production of
electricity from a renewable energy generation system.
REPRESENTATIVE SEATON called attention to page 24 of the book
included in the committee packet titled Freeing the Grid, for a
discussion of renewable energy credits. He noted that the
federal program would have to be adopted by the state in order
to credit those who install renewable energy systems. Proposed
Amendment 2 addresses page 2, line 25, and replaces "annual peak
energy usage" with "peak demand". Proposed Amendment 3
addresses page 3, lines 23 and 24, and replaces "an alternative
energy system, as the term is defined in AS 46.11.900" with
"alternative energy as identified in section 1 of this act".
4:00:27 PM
REPRESENTATIVE PETERSEN recalled a resident in Dillingham who
had two wind generators with two meters. One meter measured
what he took off the grid and one measured what he put back onto
the grid. He asked whether this was a typical installation.
REPRESENTATIVE SEATON described the meters in Alaska, all of
which are capable of running backwards and registering a credit.
The meter goes forward for usage, slows when the consumer is
generating electricity, and turns backwards when the consumer is
generating excess electricity; this is the net meter fashion.
There is another type of meter that meters electricity in and
out at a certain price under a power sale agreement. This type
of meter is used for participants in the SNAP program available
in Fairbanks and Homer. Representative Seaton pointed out that
although there are alternatives such as the SNAP program, 42
states have adopted net metering as the best way to promote the
use of renewable resources. In fact, the federal government
mandated that all public utility commissions had to review a
national metering program and adopt, or not adopt, the
recommended standards. The Regulatory Commission of Alaska
(RCA) chose not to adopt the national standards, but is in the
process of developing state standards for Alaska. He explained
that the worst case scenario for a utility would be if a
customer generated exactly the amount of electricity that they
used in a year; however, if a customer generates more
electricity than they use, that excess is donated to the
utility. Representative Seaton compared the impact to the
utility with conservation and said, "It's just like the
customer had insulated his house, or put in new windows. He
reduced his apparent usage...." He concluded that most of time
net metering will only offset a portion of a customer's
electrical usage; in fact, often electrical usage increases as
customers choose to use electricity instead of diesel fuel for
home heating.
4:05:37 PM
REPRESENTATIVE PETERSEN recalled that the aforementioned
resident in Dillingham was paying $.42 per kilowatt hour and was
receiving $.28 per kilowatt hour; this rate would pay off the
expense of the installation of the wind generators in four to
five years.
4:06:28 PM
REPRESENTATIVE JOHANSEN referred to page 3, lines 25-31 of the
bill. He noted that an exemption is created for utilities that
sell smaller amounts of electricity; however, there is not an
exemption for municipal-owned utilities such as in Ketchikan.
He asked whether the municipal utility in Ketchikan would be
forced to accept windmills, for example.
REPRESENTATIVE SEATON advised a community could have height
limits or prohibit the installation of windmills if it so
desired; the proposed legislation addresses net metering, but
does not include requirements for all municipalities to waive
their planning and zoning rights. Regarding the exemption, he
pointed out this is a benefit to the utility as a small
consumer/generator of power does not receive payment from the
utility, but only receives credits against the amount the
consumer/generator used during the year.
4:09:00 PM
REPRESENTATIVE JOHANSEN surmised the community would "locally
legislate their way around this mandate from the state statute."
REPRESENTATIVE SEATON said,
That's correct if ... they didn't want windmills. If
you're talking about that they didn't want renewable
energy ... [or] net metering, then they ... would have
to exercise some kind of other option because if they
wanted to also prevent micro hydro, and they wanted to
also prevent solar, that would be real tricky.
Because under this bill it's just like most of our,
RCA or most of our ... interconnect standards for
Alaska....
4:10:15 PM
REPRESENTATIVE TUCK asked for confirmation that only one meter
is necessary because when a resident is supplying power, the
resident is receiving credit as the meter slows down or comes to
a stop. When the meter runs backward, the credit goes to the
utility because the utility provides the transmission lines and
infrastructure.
REPRESENTATIVE SEATON agreed. He restated that all meters in
Alaska can be used in conjunction with net metering; however, a
utility could require a second meter in order to know how much
electricity is being produced by the consumer/generator.
4:11:49 PM
REPRESENTATIVE JOHANSEN asked for the fiscal implications of net
metering. For example, a bond may be floated based on how much
money flows in and out of a utility. He asked for an example of
how net metering affects a utility's cash flow.
REPRESENTATIVE SEATON related a discussion with Flathead
Electric Cooperative in Montana. It is a rural electrical
cooperative with a somewhat similar system to that proposed by
HB 66. According the Representative Seaton, the cooperative did
not see any [negative] impact; in fact, it reported better
customer relations and satisfaction. He added that if a utility
uses renewable energy, such as hydro, for its main power source
and uses carbon-based fuel only as a supplemental power source,
the proposed legislation would not apply. The goal of HB 66 is
not to displace a municipality's renewable energy source, or to
make it less cost-effective, but to replace carbon-based high-
cost fuels. As a matter of fact, Cordova is slightly problematic
because 100 percent of its summer demand is satisfied by hydro,
but hydro provides only a portion of its winter demand.
4:15:08 PM
REPRESENTATIVE PETERSEN asked whether a local electricity
company would have the independent option to require that
consumer/generators install two meters, pay a negotiated rate
for what the consumer/generator produces, and charge a different
rate for the power the utility sells.
REPRESENTATIVE SEATON explained that HB 66 applies to all of the
areas [with utilities] that do not exempt themselves. The
utility can put in two meters and have a purchase sale
agreement; furthermore, the SNAP program would allow higher
power generation. However, a big utility would not be allowed
to restrict the development of renewable fuels by paying a
consumer/generator the avoided cost of $.02 per kilowatt and
charging $.14 per kilowatt. A consumer/generator is allowed to
produce power and offset their usage. He concluded that net
metering is a valuable means to stimulate renewable energy usage
because a consumer/generator who is paying avoided cost, will
never reach a pay-back on their system.
4:17:55 PM
REPRESENTATIVE PETERSEN asked for the difference between net
metering and net billing that is proposed by other pending
legislation.
REPRESENTATIVE SEATON explained that the other proposed
legislation will take away the authority of the cooperatives in
the state to offer net metering without a vote of the full
membership. In addition, the power from the consumer/generator
is computed on a monthly billing cycle; therefore, excess power
in any given month will be paid by the utility at the wholesale
cost, which constitutes a business transaction complete with IRS
involvement.
4:20:51 PM
DAVID GARDNER, Vice President, Marketing & Member Services,
Golden Valley Electric Association (GVEA), informed the
committee GVEA has successfully promoted consumer participation
in its SNAP program; in fact, the SNAP program meets the needs
of GVEA members and the cooperative better than net metering.
The SNAP program is voluntary and self-supporting, therefore, it
does not cross-subsidize costs for [consumer/generators] by the
members who choose not to participate. Furthermore, SNAP
producers share the funds collected, and GVEA compensates
[consumer/generators] at a higher rate than they would receive
through a net metering program. Nevertheless, Mr. Gardner
assured the committee GVEA is participating in the RCA's net
metering and interconnection standards workshops and believes
that the RCA should be tasked with the oversight and
administration of the program should the state adopt net
metering and interconnection standards legislation. On behalf
of GVEA, he encouraged the committee to delay the consideration
of net metering legislation while the RCA is investigating this
issue.
4:22:28 PM
MARILYN LELAND, Executive Director, Alaska Power Association
(APA), stated that the Alaska Power Association (APA) is the
statewide trade organization representing electric utilities
that supply power to 500,000 Alaskans from Barrow to Unalaska
and the Inside Passage. She recalled that the RCA considered
net metering in its docket on the adoption of regulations to
amend the Public Utilities Regulatory Policies Act (PURPA) of
1978. The RCA did not adopt federal standards for Alaska, but
opened a docket to consider Alaska-specific standards on net
metering. Ms. Leland opined there has been good participation
from the interested parties and the RCA on this subject and an
agreement on a regulation is promised. On behalf of APA, she
recommended that the legislature not take action on any net
metering legislation this year. The utilities are not opposed
to renewable generation, to purchasing power from
[consumer/generators], or to consumers generating their own
power; however, the issue is agreeing on a fair and equitable
rate to all rate-payers.
4:24:33 PM
PHIL STEYER, Director, Government & Corporate Communications,
Chugach Electric Association, Inc., (CEA), said the CEA believes
the RCA is the proper venue for a discussion of the issues of
net metering. The RCA has begun the process that will lead to
an appropriate decision on net metering. On behalf of the CEA,
he suggested that rather than advancing legislation at this
time, the committee should allow the RCA to complete its docket
on net metering.
4:25:25 PM
ROBERT REAGAN, Representative, Municipal Light & Power (ML&P),
Municipality of Anchorage, on behalf of ML&P, informed the
committee that net metering would be a massive subsidy paid by
rate-payers of utilities to a few customers who are in a
position to own and operate net meter generation. He urged the
committee not to take action on net metering prior to the RCA's
completion of its work on the subject. Mr. Reagan opined net
metering is not a simple beneficial idea, but requires a
commercial relationship between utilities and their customers
that is generally considered unsustainable in other industries
and that may cause catastrophic harm in the utility industry.
He assured the committee that the depth of the RCA's
investigation has a better chance of avoiding unintended
consequences than action by the legislature.
4:27:18 PM
CO-CHAIR EDGMON, upon determining no one else wished to testify,
announced that HB 66 would be held over with public testimony
open.
4:27:51 PM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Energy meeting was adjourned at [4:27] p.m.