ALASKA STATE LEGISLATURE                                                                                  
          SENATE LABOR AND COMMERCE STANDING COMMITTEE                                                                        
                         April 10, 2024                                                                                         
                           1:31 p.m.                                                                                            
                                                                                                                                
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Jesse Bjorkman, Chair                                                                                                   
Senator Elvi Gray-Jackson                                                                                                       
Senator Kelly Merrick                                                                                                           
Senator Forrest Dunbar                                                                                                          
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Click Bishop, Vice Chair                                                                                                
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
SENATE BILL NO. 219                                                                                                             
"An  Act  relating  to  utilization  review  entities;  exempting                                                               
certain  health  care   providers  from  making  preauthorization                                                               
requests  for certain  services; and  providing for  an effective                                                               
date."                                                                                                                          
                                                                                                                                
     - MOVED SB 219 OUT OF COMMITTEE                                                                                            
                                                                                                                                
SENATE BILL NO. 152                                                                                                             
"An Act relating to community energy facilities."                                                                               
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
SENATE BILL NO. 257                                                                                                             
"An  Act  relating  to  the   Regulatory  Commission  of  Alaska;                                                               
relating to  public utilities;  relating to  electric reliability                                                               
organizations; relating to the  Alaska Energy Authority; relating                                                               
to the  Railbelt Transmission Organization; and  providing for an                                                               
effective date."                                                                                                                
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: SB 219                                                                                                                  
SHORT TITLE: PRIOR AUTH EXEMPT FOR HEALTH PROVIDERS                                                                             
SPONSOR(s): SENATOR(s) WILSON                                                                                                   
                                                                                                                                
02/07/24       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/07/24       (S)       L&C, HSS                                                                                               
03/13/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
03/13/24       (S)       Heard & Held                                                                                           
03/13/24       (S)       MINUTE(L&C)                                                                                            
04/08/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
04/08/24       (S)       Heard & Held                                                                                           
04/08/24       (S)       MINUTE(L&C)                                                                                            
04/10/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
BILL: SB 152                                                                                                                  
SHORT TITLE: COMMUNITY ENERGY FACILITIES; NET METERING                                                                          
SPONSOR(s): SENATOR(s) WIELECHOWSKI                                                                                             
                                                                                                                                
05/15/23       (S)       READ THE FIRST TIME - REFERRALS                                                                        
05/15/23       (S)       L&C                                                                                                    
01/29/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
01/29/24       (S)       Heard & Held                                                                                           
01/29/24       (S)       MINUTE(L&C)                                                                                            
04/10/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
BILL: SB 257                                                                                                                  
SHORT TITLE: ELECTRIC UTILITY REGULATION                                                                                        
SPONSOR(s): RESOURCES                                                                                                           
                                                                                                                                
03/01/24       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/01/24       (S)       L&C, RES, FIN                                                                                          
03/01/24       (S)       L&C WAIVED PUBLIC HEARING NOTICE,RULE                                                                  
                         23                                                                                                     
03/04/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
03/04/24       (S)       Heard & Held                                                                                           
03/04/24       (S)       MINUTE(L&C)                                                                                            
03/04/24       (S)       RES AT 3:30 PM BUTROVICH 205                                                                           
03/04/24       (S)       <Bill Hearing Canceled>                                                                                
03/27/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
03/27/24       (S)       Heard & Held                                                                                           
03/27/24       (S)       MINUTE(L&C)                                                                                            
04/05/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
04/05/24       (S)       Heard & Held                                                                                           
04/05/24       (S)       MINUTE(L&C)                                                                                            
04/10/24       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
SENATOR BILL WIELECHOWSKI, District K                                                                                           
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Sponsor of SB 152.                                                                                        
                                                                                                                                
SARAH MOON, Co-Founder                                                                                                          
Fieldworks Power                                                                                                                
San Francisco, California                                                                                                       
POSITION STATEMENT: Provided invited testimony in support of SB                                                               
152.                                                                                                                            
                                                                                                                                
KEVIN CRAY, Senior Regional Director                                                                                            
Coalition for Community Solar Access                                                                                            
Denver, Colorado                                                                                                                
POSITION STATEMENT: Provided invited testimony in support of SB                                                               
152.                                                                                                                            
                                                                                                                                
JENNY MARIE-STRIKER, Political Director                                                                                         
The Alaska Center                                                                                                               
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of SB 152.                                                                           
                                                                                                                                
EMILY COHEN, representing self                                                                                                  
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of SB 152.                                                                           
                                                                                                                                
KYLA KOSEDNAR, representing self                                                                                                
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of SB 152.                                                                           
                                                                                                                                
DAVID DUNSMORE, Staff                                                                                                           
Senator Bill Wielechowski                                                                                                       
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Provided the summary of changes for SB 152.                                                               
                                                                                                                                
BECKI ALVEY, Advisory Section Manager                                                                                           
Regulatory Commission of Alaska                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Provided comments and answered questions on                                                               
SB 152.                                                                                                                         
                                                                                                                                
SENATOR CATHY GIESSEL, District E                                                                                               
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Sponsor of SB 257.                                                                                        
                                                                                                                                
SARAH LAMBE, CFO, Homer Electric Association                                                                                    
Homer, Alaska                                                                                                                   
POSITION STATEMENT: Co-presenter for a presentation on SB 257.                                                                
                                                                                                                                
KERIANN   BAKER,   Chief   Strategic   Office,   Homer   Electric                                                               
Association                                                                                                                     
Homer, Alaska                                                                                                                   
POSITION STATEMENT: Co-presenter for a presentation on SB 257.                                                                
                                                                                                                                
MIKE CRAFT, representing self                                                                                                   
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of SB 257.                                                                           
                                                                                                                                
KEN HUCKEBA, representing self                                                                                                  
Wasilla, Alaska                                                                                                                 
POSITION STATEMENT: Testified in opposition to SB 257.                                                                        
                                                                                                                                
JOEL GROVES, Board Chair                                                                                                        
Railbelt Reliability Council                                                                                                    
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified with concerns on SB 257.                                                                        
                                                                                                                                
NATALIE KILEY-BERGEN, Energy Lead                                                                                               
Alaska Public Interest Research Group                                                                                           
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified with concerns on SB 257.                                                                        
                                                                                                                                
CHRIS ROSE, Director                                                                                                            
Renewable Alaska Energy Project                                                                                                 
Sutton, Alaska                                                                                                                  
POSITION STATEMENT: Testified with concerns on SB 257.                                                                        
                                                                                                                                
ALEX PETKANAS, Climate and Clean Energy Program Manager                                                                         
The Alaska Center                                                                                                               
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in opposition to SB 257.                                                                        
                                                                                                                                
ANTONY SCOTT, representing self,                                                                                                
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in opposition to SB 257.                                                                        
                                                                                                                                
DAVID NEWMAN, representing self                                                                                                 
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of SB 257.                                                                           
                                                                                                                                
MARYLEE GUTHRIE, representing self                                                                                              
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT: Testified with concerns on SB 257.                                                                        
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:31:49 PM                                                                                                                    
CHAIR  JESSE  BJORKMAN  called  the  Senate  Labor  and  Commerce                                                             
Standing Committee meeting  to order at 1:31 p.m.  Present at the                                                               
call to  order were Senators  Gray-Jackson, Dunbar,  Merrick, and                                                               
Chair Bjorkman.                                                                                                                 
                                                                                                                                
         SB 219-PRIOR AUTH EXEMPT FOR HEALTH PROVIDERS                                                                      
                                                                                                                                
1:32:50 PM                                                                                                                    
CHAIR  BJORKMAN announced  the consideration  of SENATE  BILL NO.                                                               
219 "An  Act relating to  utilization review  entities; exempting                                                               
certain  health  care   providers  from  making  preauthorization                                                               
requests  for certain  services; and  providing for  an effective                                                               
date."                                                                                                                          
                                                                                                                                
1:33:33 PM                                                                                                                    
CHAIR BJORKMAN solicited the will of the committee.                                                                             
                                                                                                                                
1:33:36 PM                                                                                                                    
SENATOR  GRAY-JACKSON moved  to  report SB  219,  work order  33-                                                               
LS1302\A,  from  committee  with individual  recommendations  and                                                               
attached fiscal note(s).                                                                                                        
                                                                                                                                
1:33:51 PM                                                                                                                    
CHAIR BJORKMAN  found no objection  and SB 219 was  reported from                                                               
the Senate Labor and Commerce Standing Committee.                                                                               
                                                                                                                                
1:34:00 PM                                                                                                                    
At ease                                                                                                                         
                                                                                                                                
        SB 152-COMMUNITY ENERGY FACILITIES; NET METERING                                                                    
                                                                                                                                
1:35:11 PM                                                                                                                    
CHAIR  BJORKMAN   reconvened  the   meeting  and   announced  the                                                               
consideration  of  SENATE  BILL  NO.  152  "An  Act  relating  to                                                               
community energy facilities."                                                                                                   
                                                                                                                                
He noted that this is the second  hearing of SB 152 by the Senate                                                               
Labor and Commerce Standing Committee.                                                                                          
                                                                                                                                
1:35:45 PM                                                                                                                    
SENATOR BILL WIELECHOWSKI, District  K, Alaska State Legislature,                                                               
Juneau, Alaska, Sponsor of SB 152; gave a recap of SB 152:                                                                      
                                                                                                                                
   • SB 152 will create a framework for community renewable                                                                     
     energy projects and virtual net metering in Alaska.                                                                        
   • Current net metering regulations require that the                                                                          
     generation facility be tied to a specific meter; this bill                                                                 
    will allow for ratepayers to share a facility and share                                                                     
     their net metering benefits across multiple meters.                                                                        
  • Community energy facilities enabled by this bill could be                                                                   
     as small as a four-plex putting a solar array on the roof                                                                  
    and splitting the benefits with all residents, or larger                                                                    
     scale projects that are crowd-funded by subscribers.                                                                       
   • Community solar is the fastest growing area of the                                                                         
     renewable energy sector, and at least 26 states have passed                                                                
     community solar legislation.                                                                                               
   • Since the initial hearing in January, we have worked                                                                       
     closely with utilities and other stakeholders to craft a                                                                   
     committee substitute to ensure this bill works for                                                                         
     utilities and ratepayers.                                                                                                  
                                                                                                                                
1:37:00 PM                                                                                                                    
CHAIR BJORKMAN announced invited testimony for SB 152.                                                                          
                                                                                                                                
1:37:20 PM                                                                                                                    
SARAH   MOON,  Co-Founder,   Fieldworks  Power,   San  Francisco,                                                               
California,  said   her  team   had  experience   developing  and                                                               
operating community  solar projects in  the lower 48 and  that SB                                                               
152 would enable investment from  companies like Fieldworks Power                                                               
in the State of Alaska. She  said SB 152 offered several tangible                                                               
benefits:                                                                                                                       
                                                                                                                                
   1. SB 152 would provide an element of energy choice and                                                                      
     freedom to residents and businesses  who choose to subscribe                                                               
     to these  projects. She  said this  enables access  to much-                                                               
     needed  bill  relief  as   subscribers  to  community  solar                                                               
     generally save ten percent or more on their energy costs.                                                                  
   2. Community solar helps to modernize the grid by leveraging                                                                 
     private  investment dollars  from companies  like Fieldworks                                                               
     Power  to improve  local  distribution infrastructure.  This                                                               
     investment  benefits all  ratepayers,  especially those  who                                                               
     live near the project.                                                                                                     
   3. Installing these mid-scale projects across the state                                                                      
     improves reliability and resilience by diversifying energy                                                                 
     resources.                                                                                                                 
   4. Because facilities must be built in the utility service                                                                   
     territory where the customer resides, it creates local,                                                                    
     home-grown energy.                                                                                                         
                                                                                                                                
MS. MOON said in other  states that have already passed community                                                               
solar  legislation, the  impact has  been significant.  Over 1600                                                               
community  solar projects  have  been built  across the  country,                                                               
enough to  power over  1 million  homes. She  said each  of these                                                               
projects  delivered  significant  investment to  the  communities                                                               
where they are located, not  only through grid upgrades, but also                                                               
through local jobs, property taxes, lease payments and more.                                                                    
                                                                                                                                
MS.  MOON  concluded passing  SB  152  will enable  local  energy                                                               
generation,  economic   development,  grid   upgrades,  increased                                                               
reliability  and   resilience,  and  electric  bill   relief  for                                                               
consumers and businesses.                                                                                                       
                                                                                                                                
1:40:19 PM                                                                                                                    
KEVIN  CRAY, Senior  Regional Director,  Coalition for  Community                                                               
Solar Access (CCSA), Denver, Colorado,  said CCSA is the national                                                               
trade  organization   solely  focused  on  the   community  solar                                                               
industry,  representing 120  members in  virtually all  community                                                               
solar markets  across the  country and at  the federal  level. He                                                               
said CCSA's mission  is to expand customer choice  and freedom to                                                               
access the benefits  of solar energy to  all Americans regardless                                                               
of their ability  to host a solar array. He  said community solar                                                               
fills several notable  gaps in the renewable  energy space, whose                                                               
sizing  perspective is  to thread  between small  rooftop systems                                                               
that can  already be  found across the  state and  large utility-                                                               
scale systems  that provide  bulk power needs  to the  system. He                                                               
said  they are  commonly two  to five  megawatts in  capacity and                                                               
roughly  ten to  twenty-five  megawatts  of land-sizing,  meaning                                                               
they can be located near areas  where people live, work and play,                                                               
providing  energy  close to  where  it  would be  consumed.  This                                                               
locational  proximity  provides  increased grid  efficiencies  by                                                               
reducing  the need  for costly  transmission  lines to  transport                                                               
energy  from  larger  systems  to  load  centers  that  could  be                                                               
hundreds  of  miles  away.  Smaller  system  sizes  also  provide                                                               
opportunities for  smaller landowners  to host projects  and reap                                                               
the benefits of doing so.                                                                                                       
                                                                                                                                
1:41:35 PM                                                                                                                    
MR. CRAY  said from an  industry perspective CCSA's  members have                                                               
collectively  deployed over  $10  billion of  private capital  to                                                               
upgrade  the  electric  grid,  bring  electric  bill  savings  to                                                               
millions  of customers  across the  lower 48  and drive  economic                                                               
development primarily  in rural communities. He  said CCSA stands                                                               
ready  and  excited  to  bring  those  investments  and  economic                                                               
opportunities  northward  to  the  great  state  of  Alaska  upon                                                               
passage of SB 152.                                                                                                              
                                                                                                                                
MR.  CRAY noted  that economic  development opportunities  extend                                                               
well beyond the temporary construction  jobs needed to physically                                                               
build  the  [energy  generation]   projects  to  other  in-demand                                                               
sectors   that  include   engineering,  marketing,   sales,  land                                                               
acquisition, siting, etc. He noted  tangential industries such as                                                               
logging,  food  and beverage,  transportation  that  would see  a                                                               
boost in demand  from the development of these  projects. He said                                                               
these  benefits  precede  the  economic  impacts  of  subscribing                                                               
customers who will put their energy  bill savings to use in their                                                               
local  communities  or taking  the  trip  their family  has  been                                                               
looking forward to.                                                                                                             
                                                                                                                                
1:42:51 PM                                                                                                                    
CHAIR BJORKMAN opened public testimony on SB 152.                                                                               
                                                                                                                                
1:43:12 PM                                                                                                                    
JENNY  MARIE-STRIKER,  Political  Director,  The  Alaska  Center,                                                               
Anchorage, Alaska,  testified in support  of SB 152 on  behalf of                                                               
The  Alaska Center  which she  said was  a state-wide  non-profit                                                               
organization  that   seeks  to   create  a  thriving,   just  and                                                               
sustainable future  for all  Alaskans. She said  SB 152  would be                                                               
very  impactful based  on communication  from Alaskans  about the                                                               
need  for more  affordable and  accessible community  energy. She                                                               
described  the  Solarize program  run  by  The Alaska  Center  in                                                               
Anchorage,  Fairbanks and  a coalition  of other  partners, since                                                               
2018.  She   said  Solarize  brings  neighbors,   businesses  and                                                               
community   spaces  together   to  purchase   solar  panels   and                                                               
installation at group rates. She  said there were many people who                                                               
would like to access solar  energy or participate in the Solarize                                                               
program but are unable to for  a variety of reasons such as: cost                                                               
of  solar equipment,  inability to  support solar  equipment, and                                                               
renters  who don't  own  their  residence. She  said  SB 152,  by                                                               
allowing  community  energy  with  virtual  net  metering  and  a                                                               
subscriber  model  would  open energy  generation  to  many  more                                                               
Alaskans  regardless of  where  they live  and  whether they  own                                                               
property or not. In addition  to addressing the [energy] needs of                                                               
individuals, she  said SB  152 would make  an impact  on Alaska's                                                               
overall energy  portfolio by encouraging more  private investment                                                               
from dispersed energy generation.                                                                                               
                                                                                                                                
MS.  MARIE-STRIKER noted  the natural  gas crisis  in Alaska  and                                                               
energy proposals  in the legislature  to address it. She  said SB                                                               
152 would  add to  the toolbox of  solutions that  Alaskans would                                                               
benefit from.                                                                                                                   
                                                                                                                                
1:45:41 PM                                                                                                                    
EMILY COHEN,  representing self, Anchorage, Alaska,  testified in                                                               
support of SB  152 and that she supports  community solar because                                                               
it  allows residents  who  rent  to have  more  choice about  the                                                               
source of the energy they use.  She said solar panel ownership is                                                               
currently  limited to  individuals who  own their  own homes  and                                                               
land  and solar  co-ops would  allow renters  and homeowners  who                                                               
live on shaded property to buy  into shares of solar energy farms                                                               
in their neighborhoods.  She said solar energy has  been shown to                                                               
decrease  energy costs  for households  and  renters deserve  the                                                               
ability  to  enjoy those  cost  savings.  She advocated  for  the                                                               
ability to  choose her source of  energy and said the  ability to                                                               
buy into a community solar  cooperative would help counteract the                                                               
monopoly that  Chugach Electric  Association has  in Southcentral                                                               
Alaska  and  a  more  stable and  diverse  energy  portfolio  for                                                               
Alaska. She noted the looming  [natural] gas crisis in Cook Inlet                                                               
said passing SB  152 is an excellent way to  insure stable energy                                                               
production and consumption in the  state. She urged the committee                                                               
to pass SB 152 and be energy champions for the state.                                                                           
                                                                                                                                
1:47:02 PM                                                                                                                    
KYLA KOSEDNAR, representing self,  Anchorage, Alaska, said SB 152                                                               
would  go a  long way  toward making  energy more  affordable and                                                               
accessible for  her family. She  said she  and her husband  own a                                                               
home that  is part of  a homeowner's association (HOA).  She said                                                               
they  don't own  their roof  and can't  invest in  rooftop solar,                                                               
though she  said even if their  HOA allowed it, they  wouldn't be                                                               
able to afford a traditional  solar array. She said the community                                                               
solar  projects proposed  by Chugach  Electric would  not provide                                                               
cost  savings that  would allow  them to  invest in  solar energy                                                               
[equipment] and  that is why it  was important to pass  SB 152 to                                                               
make energy more accessible to  families like theirs and it would                                                               
go  a long  way toward  lowering  their energy  costs. She  noted                                                               
their two-bedroom townhouse electric  bill sometimes exceeds $200                                                               
per month  in the  winter. She  said the  ability to  offset that                                                               
cost  with  savings  from  solar   year-round  with  virtual  net                                                               
metering, would make a big  difference for their family. She said                                                               
passing SB  152 seems  like a  simple, equitable  and inexpensive                                                               
way to bring  more renewables onto the grid  and lower dependency                                                               
on natural gas.                                                                                                                 
                                                                                                                                
1:48:40 PM                                                                                                                    
CHAIR BJORKMAN closed public testimony on SB 152.                                                                               
                                                                                                                                
1:48:55 PM                                                                                                                    
CHAIR BJORKMAN solicited a motion.                                                                                              
                                                                                                                                
1:48:57 PM                                                                                                                    
SENATOR GRAY-JACKSON moved to adopt the committee substitute                                                                    
(CS) for SB 152, work order 33-LS0607\U, as the working                                                                         
document.                                                                                                                       
                                                                                                                                
1:49:10 PM                                                                                                                    
CHAIR BJORKMAN objected for purposes of explanation.                                                                            
                                                                                                                                
1:49:44 PM                                                                                                                    
DAVID DUNSMORE, Staff, Senator Bill Wielechowski, Alaska State                                                                  
Legislature, Juneau, Alaska, explained the changes in the CS for                                                                
SB 152.                                                                                                                         
                                                                                                                                
[Original punctuation included]                                                                                                 
                                                                                                                                
                        Senate Bill 152                                                                                       
                  Community Energy Facilities                                                                                 
       Summary of Changes Version B to Draft CS Version U                                                                       
                                                                                                                                
     The bill was shortened  and streamlined in consultation                                                                    
     with utilities and other stakeholders.                                                                                     
                                                                                                                                
     A new  Section 1  was added giving  the bill  the short                                                                    
     title  "the   Saving  Alaskans  Money   with  Voluntary                                                                    
     Community Energy (SAVE) Act."                                                                                              
                                                                                                                                
     Throughout  the  bill,  provisions  that  restated  net                                                                    
     metering provisions that  currently exist in Regulatory                                                                    
     Commission  of Alaska  (RCA) regulations  were removed.                                                                    
     In new AS 42.05.725  the language related to exemptions                                                                    
     was replaced with  a provision that this  bill does not                                                                    
     apply to  utilities that are  exempt from  net metering                                                                    
     requirements adopted by the RCA.                                                                                           
                                                                                                                                
     In new  AS 42.05.727  the term "community  energy plan"                                                                    
     is replaced  with "community energy tariff."  The limit                                                                    
     of  50   megawatts  of  power  from   community  energy                                                                    
     facilities was  removed from this section,  and instead                                                                    
     this limit  would be set  by the utilities and  the RCA                                                                    
     through community energy tariffs and regulations.                                                                          
                                                                                                                                
     New  Section 42.05.729  was shortened  to simply  state                                                                    
     that  the RCA  will  adopt rates  for community  energy                                                                    
     facilities  that   reflect  the  full   economic  value                                                                    
     provided and  do not  have a  negative effect  on other                                                                    
     ratepayers. Language  was added that the  RCA may adopt                                                                    
     different  rates for  facilities  that provide  battery                                                                    
     storage.                                                                                                                   
                                                                                                                                
     New  AS 42.05.731  was renamed  from "Authority  of the                                                                    
     commission"   to   "Authority   and   duties   of   the                                                                    
     commission." Provisions  were added to this  section to                                                                    
     clarify the  RCA's role in ensuring  the implementation                                                                    
     of community  energy programs. The language  related to                                                                    
     prevailing wages  for construction of  community energy                                                                    
     facilities  that was  previously in  new AS.  42.05.733                                                                    
     was moved to this section.                                                                                                 
                                                                                                                                
1:51:47 PM                                                                                                                    
MR. DUNSMORE  continued to explain the  changes in the CS  for SB                                                               
152.                                                                                                                            
                                                                                                                                
     New AS 42.05.733 was removed from the bill.                                                                                
                                                                                                                                
     In new AS  42.05.735, terms that are no  longer used in                                                                    
     the   bill  were   removed   and   the  definition   of                                                                    
     "subscriber"  was updated  to limit  it to  residential                                                                    
     ratepayers  and  commercial   ratepayers  with  monthly                                                                    
     demand of less than 50 kilowatt-hours.                                                                                     
                                                                                                                                
1:52:26 PM                                                                                                                    
CHAIR  BJORKMAN noted  the  new  CS for  SB  152  would give  the                                                               
Regulatory  Commission  of Alaska  (RCA)  a  to-do list  for  the                                                               
projects addressed by  the bill. He asked how long  it would take                                                               
to develop a community solar project, working through the RCA.                                                                  
                                                                                                                                
1:53:02 PM                                                                                                                    
MR. DUNSMORE  said SB 152 would  give the RCA one  year after the                                                               
effective  date  to  adopt regulations.  He  said  the  community                                                               
energy tariff filings  would have the same timeline  the RCA uses                                                               
for other  tariff filings. Regarding  specific projects,  he said                                                               
the goal of  SB 152 was that once utilities  have approved energy                                                               
tariffs in  place, utilities and ratepayers  and entities looking                                                               
to create community energy projects  would be provided regulatory                                                               
certainty. He  said as  long as  they are  interconnecting within                                                               
the standards  approved through the utility's  energy tariff, the                                                               
RCA would not be involved in the process.                                                                                       
                                                                                                                                
1:54:09 PM                                                                                                                    
CHAIR BJORKMAN  asked for an  explanation of the provision  in SB                                                               
152 to protect other ratepayers from being negatively impacted.                                                                 
                                                                                                                                
1:54:23 PM                                                                                                                    
MR. DUNSMORE  said the vision for  SB 152 was that  it would work                                                               
similarly to  existing net metering regulations  where ratepayers                                                               
who participate  in the  metering are  credited with  the avoided                                                               
cost for  the electricity they  create but are still  required to                                                               
pay  for  things   like  the  base  rate  which   would  pay  for                                                               
administrative and transmission services.                                                                                       
                                                                                                                                
1:54:59 PM                                                                                                                    
CHAIR  BJORKMAN   asked  who  would  pay   for  installation  and                                                               
connection of  solar generation equipment  to the grid  under the                                                               
provisions of SB 152.                                                                                                           
                                                                                                                                
1:55:20 PM                                                                                                                    
MR. DUNSMORE said  the project owner would pay  for the equipment                                                               
and installation through terms of the subscriptions.                                                                            
                                                                                                                                
1:55:50 PM                                                                                                                    
CHAIR  BJORKMAN asked  the RCA  representative to  comment on  SB                                                               
152.                                                                                                                            
                                                                                                                                
1:56:06 PM                                                                                                                    
BECKI ALVEY,  Advisory Section Manager, Regulatory  Commission of                                                               
Alaska, Anchorage,  Alaska, noted  the timeline for  the adoption                                                               
of regulations  within a year  of the  effective date of  SB 152.                                                               
She said  the current statutory  deadline for regulations  is two                                                               
years. The  provisions of SB  152 would supersede  statute. Other                                                               
than the timeline,  she said the RCA had not  taken a position on                                                               
SB 152, but in December the  RCA approved a pilot community solar                                                               
program  proposed by  Chugach Electric  Association  as a  tariff                                                               
filing with the RCA.                                                                                                            
                                                                                                                                
1:57:34 PM                                                                                                                    
CHAIR  BJORKMAN  removed  his  objection.  He  found  no  further                                                               
objection and CSSB 152 was adopted as the working document.                                                                     
                                                                                                                                
1:57:51 PM                                                                                                                    
CHAIR  BJORKMAN held  SB 152  in  the Senate  Labor and  Commerce                                                               
Standing Committee.                                                                                                             
#                                                                                                                             
                                                                                                                                
1:57:59 PM                                                                                                                    
At ease                                                                                                                         
                                                                                                                                
                SB 257-ELECTRIC UTILITY REGULATION                                                                          
                                                                                                                                
2:00:10 PM                                                                                                                    
CHAIR  BJORKMAN   reconvened  the   meeting  and   announced  the                                                               
consideration  of SENATE  BILL NO.  257 "An  Act relating  to the                                                               
Regulatory Commission  of Alaska;  relating to  public utilities;                                                               
relating to  electric reliability organizations; relating  to the                                                               
Alaska Energy  Authority; relating  to the  Railbelt Transmission                                                               
Organization; and providing for an effective date."                                                                             
                                                                                                                                
2:00:52 PM                                                                                                                    
SENATOR  CATHY GIESSEL,  District  E,  Alaska State  Legislature,                                                               
Juneau, Alaska,  Sponsor of SB 257,  gave a recap of  SB 257. She                                                               
said she has  been inspired by Alaskans coming  together to solve                                                               
the electric  transmission and  energy issues  of the  state. She                                                               
reported  that she  and several  others traveled  to Iceland  and                                                               
that she was also inspired by  what they have done to solve these                                                               
issues for  themselves. She  said they  began with  separated and                                                               
isolated grid utilities,  and they came together  with the single                                                               
goal to unite and create a  more efficient system. She said there                                                               
are numerous stakeholders  that came together to work  on SB 257,                                                               
including the  governor. She expressed  sincere and  serious hope                                                               
that  there was  a goal  that  has united  the stakeholders.  She                                                               
emphasized the  federal funding made  available through  the hard                                                               
work of Alaska's federal delegation.                                                                                            
                                                                                                                                
SENATOR GIESSEL  said the goal of  SB 257 was to  unite Alaskans,                                                               
to integrate  the transmission system  into an  efficient highway                                                               
for  electrons,  to  lower  the   cost  of  energy  and  get  the                                                               
transmission system  open to  renewable resources  and ultimately                                                               
[provide] cleaner, lower cost energy for all Alaskans.                                                                          
                                                                                                                                
2:02:49 PM                                                                                                                    
CHAIR BJORKMAN announced invited testimony on SB 257.                                                                           
                                                                                                                                
2:03:06 PM                                                                                                                    
SARAH   LAMBE,   Chief    Financial   Officer,   Homer   Electric                                                               
Association, Homer, Alaska, introduced  herself and her colleague                                                               
and said they would provide a presentation on SB 257.                                                                           
                                                                                                                                
2:03:21 PM                                                                                                                    
KERIANN   BAKER,   Chief   Strategic  Officer,   Homer   Electric                                                               
Association,  Homer,  Alaska,  introduced  herself  and  began  a                                                               
presentation on  SB 257.  She expressed  appreciation for  SB 257                                                               
and  said  Homer  Electric Association  (HEA)  shared  the  goals                                                               
expressed  by the  sponsor.  She said  HEA would  like  to see  a                                                               
unified system with economic dispatch  for all. She expressed the                                                               
desire to talk through the promises of SB 257 and some concerns                                                                 
unique to HEA.                                                                                                                  
                                                                                                                                
2:04:00 PM                                                                                                                    
MS. BAKER continued to slide 2.  She read through the points that                                                               
the presentation  would address and  said SB  257 may not  go far                                                               
enough.  She  said  HEA  has  concerns with  the  manner  of  the                                                               
drafting for SB  257 and she reiterated alignment  with the goals                                                               
expressed for SB 257.                                                                                                           
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
                                                    Overview                                                                  
                                 SB 257 and its implications                                                                  
                                                                                                                                
     01-                                                                                                                        
     Understanding SB257                                                                                                        
     • Overview of SB257                                                                                                        
                                                                                                                                
     02-                                                                                                                        
     Concerns & Impacts                                                                                                         
     • Potential Impacts of SB257                                                                                               
                                                                                                                                
     03-                                                                                                                        
     What's Missing                                                                                                             
     • Suggestions for Legislative Consideration                                                                                
                                                                                                                                
     04-                                                                                                                        
     Summary                                                                                                                    
                                                                                                                                
2:05:17 PM                                                                                                                    
MS. LAMBE continued to slide 3 and expanded on the points                                                                       
outlined.                                                                                                                       
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
                                        Concerns and Impacts                                                                  
                                     As written, SB 257 may:                                                                  
                                                                                                                                
     07                                                                                                                         
     Potential Member Impact                                                                                                  
        • Current & future assets investment                                                                                    
        • AEEC lost opportunities                                                                                               
        • RTO Governance Structure                                                                                              
        • Cost Causer vs. Cost Payer                                                                                            
                                                                                                                                
     06                                                                                                                         
     Transmission Assets                                                                                                      
        • Book values & costs will vary based upon age,                                                                         
          debt, etc.                                                                                                            
        • Consistent valuation methodology needed                                                                               
                                                                                                                                
     05                                                                                                                         
     State: Buying or Leasing                                                                                                 
        • Refinancing of assets                                                                                                 
        • Utility LTD rates vs. State LTD rates                                                                                 
        • Who is responsible for penalties?                                                                                     
                                                                                                                                
     04                                                                                                                         
     Rural/Small Utility Status                                                                                               
        • RUS LTD rates                                                                                                         
        • PACE Program                                                                                                          
        • USDA NEW ERA Program                                                                                                  
        • GRIP Topic 1                                                                                                          
                                                                                                                                
     03                                                                                                                         
     Un-equal Access To Grid                                                                                                  
        • Islanding of HEA system                                                                                               
        • System Constraints                                                                                                    
        • Bradley Agreement                                                                                                     
                                                                                                                                
     02                                                                                                                         
     Administrative Burden                                                                                                    
        • Overlapping & duplicative duties between RRC,                                                                         
          RTO, RCA & AEA                                                                                                        
        • No clear delineation between duties                                                                                   
        • Coordination between 4 entities and 5 utilities                                                                       
          with   duplicate    duties   creates   unnecessary                                                                    
          complexity                                                                                                            
                                                                                                                                
MS. LAMBE said HEA has  invested to reliably serve the generation                                                               
and  transmission needs  of  its membership  in  its own  service                                                               
territory. She said  HEA is the only utility  that currently does                                                               
not pay  any transmission wheeling  charges, nor do  they receive                                                               
transmission  wheeling  revenues  and  so  HEA  is  in  a  unique                                                               
position when considering  the impact of socializing  the cost of                                                               
the Railbelt transmission system.  She described the transmission                                                               
system as analogous to a pipe in  that only so much water can fit                                                               
in it and that the  current transmission tie line between Bradley                                                               
Lake and  Anchorage is only  capable of pushing power  north. She                                                               
said transmission  capacity is so  restricted that  upgrades will                                                               
be required if  the state and its utility partners  invest in the                                                               
expansion  of Bradley  Lake by  way of  the Dixon  Diversion. She                                                               
said historically there  has not been "room in the  pipe" for HEA                                                               
to participate  in any  wholesale sales  for resale  markets. She                                                               
said this  has necessitated that  HEA right-size projects  to fit                                                               
their  system, prohibiting  HEA's  ability to  take advantage  of                                                               
economies of scale. To compensate  for that, HEA has competed for                                                               
and  recently  received  an  invitation   to  apply  for  a  U.S.                                                               
Department of Agriculture (USDA) grant  under the Power and Clean                                                               
Affordable Energy  (PACE) program for a  battery system necessary                                                               
to support HEA achieving a  renewable energy level of 60 percent.                                                               
She said the PACE program is  part of the inflation reduction act                                                               
which represents the largest  investment in rural electrification                                                               
since Franklin D. Roosevelt signed  the Rural Electrification Act                                                               
in  1936.  If HEA  proceeds  under  the application,  they  would                                                               
receive 60 percent loan forgiveness  of a $100 million investment                                                               
with the  remaining $40 million  recaptured under the  IRS direct                                                               
pay program.                                                                                                                    
                                                                                                                                
2:07:14 PM                                                                                                                    
MS.  LAMBE   said  HEA  has   diligently  been   working  towards                                                               
leveraging  its rural  electric utility  status to  diversify its                                                               
energy  resources, reduce  dependence  on  carbon-based fuel  and                                                               
reduce the  upward pressure on  rates. She said HEA's  ability to                                                               
proceed with  the application and  to secure these  federal funds                                                               
amidst SB 257  is relatively unclear and it is  not a benefit she                                                               
would lightly relinquish.                                                                                                       
                                                                                                                                
MS.  LAMBE noted  the items  bulleted under  Items 05  and 06  on                                                               
slide 3 and said she did not  know whether it was the dividing up                                                               
of the current  pool of transmission costs that  was the greatest                                                               
concern to  HEA, but certainly  future plans for  replacement and                                                               
expansion  has  HEA looking  at  it  from a  return-on-investment                                                               
perspective. She  said the Railbelt modernization  and resiliency                                                               
plan  contemplates  an  investment  close to  $3  billion.  HEA's                                                               
contribution to the plan would gain  them access to but would not                                                               
provide  for   the  most   economic  dispatching   of  generation                                                               
resources to HEA's membership. Until  the system is unconstrained                                                               
and   system  islanding   events   contemplated,  HEA's   service                                                               
territory would  not be an ideal  location for IPPs to  invest in                                                               
since the greater  Railbelt resale market is  unavailable to HEA.                                                               
In  addition,  HEA's  attractiveness  as  an  off-taker  for  IPP                                                               
projects developed  in the interior  has diminished  since system                                                               
islanding prevents delivery to HEA for  up to three months of the                                                               
year for the next five to ten years.                                                                                            
                                                                                                                                
MS. LAMBE  concluded that SB  257 provides  a path to,  but stops                                                               
short of  delivery of the  most economically  dispatched [energy]                                                               
generation on the  Railbelt. It may not be the  right addition to                                                               
the  plethora  of  organizations  existing or  being  set  up  to                                                               
administer these assets on the Railbelt.                                                                                        
                                                                                                                                
2:08:58 PM                                                                                                                    
MS. BAKER  continued to slide 4  and said HEA had  concerns about                                                               
unintended consequences and the unknown.                                                                                        
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
                                        Concerns and Impacts                                                                  
                                       The #1 Concern to HEA                                                                  
                                                                                                                                
     01 the Unknown & Unintended Consequences                                                                                 
                                                                                                                                
MS. BAKER noted HEA also  sent representatives to Iceland and one                                                               
of the  things they learned was  it took 20 years  for Iceland to                                                               
accomplish their  system. She  said HEA does  not think  it would                                                               
take 20 years to accomplish  what Alaska needs, but she advocated                                                               
for full understanding.  She said the Railbelt managers  set up a                                                               
transmission committee, composed  of a team of  experts and hired                                                               
two  experts  as consultants,  one  of  whom  will focus  on  the                                                               
governance model  to ensure  that it makes  sense for  Alaska and                                                               
the  other   will  focus  on  inter-regional   transfers  from  a                                                               
technical perspective and from a tariff-based perspective.                                                                      
                                                                                                                                
2:10:18 PM fix                                                                                                                
MS.  BAKER  advanced  to  slide  5 and  expanded  on  the  points                                                               
outlined.                                                                                                                       
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
                                              What's Missing                                                                  
             A Careful Approach to a Unified Railbelt System                                                                    
                   Suggestions for Legislative Consideration                                                                    
                                                                                                                                
     01                                                                                                                         
     Does not reduce prices for utilities or members.                                                                           
                                                                                                                                
     02                                                                                                                         
     Does not resolve the fuel issue.                                                                                           
                                                                                                                                
     03                                                                                                                         
      Creates socialized transmission costs without equal                                                                       
     access.                                                                                                                    
                                                                                                                                
     04                                                                                                                         
     Does not increase capacity or re-allocate capacity                                                                         
                                                                                                                                
     05                                                                                                                         
     Transmission Wheeling not based on demand.                                                                                 
                                                                                                                                
     06                                                                                                                         
     Does not remove system constraints prior to effective                                                                      
     date.                                                                                                                      
                                                                                                                                
MS.  BAKER  said SB  257  would  not  reduce prices  for  utility                                                               
members and  would not  resolve the  issue of  fuel. She  said it                                                               
would  socialize transmission  cost but  does not  create access.                                                               
She suggested that, for the  Kenai, this is equivalent to putting                                                               
out an all-you-can-eat buffet, and  charging for a ticket, though                                                               
one  party has  already eaten  and  can't go  through the  buffet                                                               
line. She acknowledged the  over-simplification [of her metaphor]                                                               
but  maintained  the  concept  and  said  the  importance  of  an                                                               
effective date  for the  system to  be constrained  is critically                                                               
important for equal access to  the market for all. She emphasized                                                               
that she  refers to access not  only for the utilities,  but also                                                               
for IPPs. She said HEA looks forward  to the time when there is a                                                               
free, open  and competitive  market which  means energy  would be                                                               
produced  by utilities  with free  access to  the market  without                                                               
physical  or other  constraints.  She said  the  IPPs also  would                                                               
compete with  the idea that  the lowest cost electrons  wins. She                                                               
said  that is  what HEA's  members really  want; she  opined they                                                               
don't really care where the electricity  comes from as long as it                                                               
is the lowest  price and HEA is committed to  providing that. She                                                               
said  SB  257  would  not   increase  capacity  and  it  wouldn't                                                               
reallocate  the  capacity.  Other  concerns  HEA  would  like  to                                                               
carefully  work  through with  the  transmission  group are  that                                                               
transmission wheeling  charges would  not be  based on  demand or                                                               
use and the system constraints would  not be removed prior to the                                                               
effective date.                                                                                                                 
                                                                                                                                
2:11:51 PM                                                                                                                    
MS. BAKER  advanced to slide 6  which depicted a group  of people                                                               
standing together in  an outdoor setting and a  paper napkin with                                                               
a pencil sketch of a hand poised  to draw on the napkin. She said                                                               
the slide  was meant to  suggest "the napkin" drafted  in Iceland                                                               
by  the  Railbelt  managers.  She said  the  managers  were  very                                                               
excited by what  they saw in Iceland, and one  of the things that                                                               
is  included  [on  the  napkin  sketch]  is  unified  rates  when                                                               
capacity  constraints   are  removed.  She  said   that  is  very                                                               
important to  HEA. She emphasized that  HEA is a partner  [in the                                                               
Railbelt transmission  system] and  advocated for  the idea  of a                                                               
unified  system  with true  economic  dispatch.  She expressed  a                                                               
desire to get  it right and consider all the  issues on the fore-                                                               
front  so  future legislatures  are  not  asking for  fixes.  She                                                               
concurred with  the motives  and objectives  of the  bill sponsor                                                               
and suggested  that SB 257 may  not be the vehicle  to accomplish                                                               
the desired goals.                                                                                                              
                                                                                                                                
2:13:38 PM                                                                                                                    
CHAIR BJORKMAN  asked for  examples of  energy constraint  to and                                                               
from the HEA service area and what causes the constraint.                                                                       
                                                                                                                                
2:14:05 PM                                                                                                                    
MS.  BAKER  answered  the  current   constraint  is  the  limited                                                               
capacity  of  the  transmission  system. She  said  HEA  is  also                                                               
constrained  by  the  Bradley Project  Management  agreement  and                                                               
settlement,  which   designated  a  priority  list:   1)  Chugach                                                               
Electric Association (CEA)  native load and Cooper  Lake Hydro 2)                                                               
Bradley  Energy  production  3)  Bradley  Spinning  Reserve.  She                                                               
explained that any remaining capacity  after those priorities are                                                               
satisfied theoretically could be sold  by HEA. However, she said,                                                               
there simply would not be  enough capacity. She further explained                                                               
that  when  the  additional  [transmission]  line  is  built  the                                                               
physical  constraint  will  be   removed,  so  the  transfer  and                                                               
receiving concerns  would be removed.  She noted that  when power                                                               
is  sent to  HEA, called  an "off-setting  flow", it  reduces the                                                               
pressure  and allows  more energy  to flow  through. It  isn't an                                                               
equivalent because it offsets what is being sent north.                                                                         
                                                                                                                                
2:15:39 PM                                                                                                                    
CHAIR BJORKMAN summarized the testimony  and said, under the RTO,                                                               
as SB 257 is currently  written, HEA members would be responsible                                                               
to pay for transmission assets  as well as any ancillary services                                                               
connected to  those assets without  the benefit of the  option to                                                               
purchase  low-cost power  or selling  lower cost  power to  other                                                               
areas of the grid. He asked whether this summary was correct.                                                                   
                                                                                                                                
2:16:10 PM                                                                                                                    
MS. BAKER confirmed the summary  and noted HEA members would also                                                               
still  be responsible  for  producing and  paying  for their  own                                                               
power and  they would have  to upgrade their system  because they                                                               
don't have the access; they  would also be responsible for paying                                                               
for the [indisc]  without equal access to the  similar value that                                                               
would be  provided to  other people on  the grid.  She emphasized                                                               
this  would be  true for  IPPs in  addition to  HEA. She  further                                                               
opined the  IPPs would be  reluctant to  locate in the  HEA area,                                                               
even if it  made sense from a science  or technology perspective,                                                               
for the same reason.                                                                                                            
                                                                                                                                
2:16:54 PM                                                                                                                    
CHAIR  BJORKMAN described  the two-line  system envisioned  after                                                               
the Grid  Resilience and Innovation  Program (GRIP)  is completed                                                               
and asked  whether HEA anticipated  truly open access due  to the                                                               
lifting of  constraints on the  transmission system with  the two                                                               
lines.                                                                                                                          
                                                                                                                                
2:17:20 PM                                                                                                                    
MS.  BAKER confirmed  that  a  second line  off  the Kenai  would                                                               
remove  the physical  constraints  [to  energy transmission]  and                                                               
there  would be  equal  access  to the  market  for all  parties,                                                               
whether utilities or IPPs and regardless of their location.                                                                     
                                                                                                                                
2:17:41 PM                                                                                                                    
CHAIR BJORKMAN  referred to a financial  analysis report produced                                                               
by Steve Colt [Research Professor  of Energy Economics and Policy                                                               
at Alaska Center for Energy  and Power, University of Alaska]. He                                                               
highlighted  data in  the report  regarding  potential costs  and                                                               
benefits  for  HEA. He  asked  whether  Ms.  Baker had  seen  the                                                               
report.                                                                                                                         
                                                                                                                                
2:18:08 PM                                                                                                                    
MS. LAMBE  answered that  there were  a number  of points  in the                                                               
document  that   she  opined  reflected  the   complexities  that                                                               
utilities encounter  particularly with regard to  ratemaking. She                                                               
suggested that, on paper, it would  appear HEA is the only winner                                                               
in  the re-allocation  of transmission  costs. She  suggested the                                                               
report did not represent an  "apples to apples" comparison of the                                                               
utilities and the findings were  the result of annual filings HEA                                                               
submits to  the Regulatory Commission  of Alaska (RCA).  She said                                                               
Alaska Electric  & Energy Cooperative  (AAEC) and  Homer Electric                                                               
Association (HEA) have  a unique relationship in that  they are a                                                               
wholly owned subsidiary for  Railbelt Generation and Transmission                                                               
(RG&T) and the rest of  the Railbelt utilities are a consolidated                                                               
entity. She  suggested distinctions  could be made  regarding the                                                               
required tier  or margin on  the distribution  cooperative versus                                                               
the transmission and generation  cooperative. She referred to the                                                               
allocations of  costs and  what is included  in the  reporting of                                                               
costs  and   acknowledged  the  incentive  to   report  costs  as                                                               
transmission  costs  with  the understanding  that  the  pool  of                                                               
transmission costs  will be shared.  She said it is  important to                                                               
consider the  competing priorities the individual  utilities have                                                               
in  representing  their  transmission  costs to  be  shared.  She                                                               
recalled specific  revenues and costs from  the referenced report                                                               
and argued that the amount  of margins did not accurately reflect                                                               
the costs  and revenues.  She said  the report  is an  example of                                                               
taking  all  the  data,  throwing  it  together  and  creating  a                                                               
narrative with some of the numbers  that support what you want to                                                               
report.                                                                                                                         
                                                                                                                                
2:21:09 PM                                                                                                                    
CHAIR BJORKMAN summarized  that the cost analysis  report by Colt                                                               
and the  Alaska Center  for Energy and  Power did  not accurately                                                               
reflect  HEA's  real,  on-the ground  situation  financially  and                                                               
asked whether that was the view of HEA.                                                                                         
                                                                                                                                
2:21:21 PM                                                                                                                    
MS.  LAMBE   replied  that  the  report   was  an  understandable                                                               
outsider's  perspective on  the utility's  finances, but  she did                                                               
not agree with the final analysis.                                                                                              
                                                                                                                                
2:21:32 PM                                                                                                                    
CHAIR  BJORKMAN asked  how SB  257 would  impact grants  or other                                                               
rural financing HEA receives.                                                                                                   
                                                                                                                                
2:21:40 PM                                                                                                                    
MS. LAMBE said she was not sure.  She noted HEA is in the process                                                               
of applying  for the  afore-mentioned PACE  grant. She  noted the                                                               
$100 million  loan forgiveness  [at 60  percent] provided  by the                                                               
grant would be applicable to HEA  because of its rural and tribal                                                               
and energy  community status. She said  without those attributes,                                                               
it becomes a straight  loan and so what may be at  risk is the 60                                                               
percent subsidy.                                                                                                                
                                                                                                                                
2:22:40 PM                                                                                                                    
CHAIR BJORKMAN  referred to islanding  events due to  wildfire or                                                               
planned maintenance  and the  perception that  HEA has  access to                                                               
electricity from  Bradley Lake  when other  utilities do  not. He                                                               
asked for  an explanation  of what happens  in those  events from                                                               
HEA's perspective.  He described  the public perception  that HEA                                                               
can enjoy  all the free power  they want from Bradley  Lake while                                                               
the other utilities are disconnected.                                                                                           
                                                                                                                                
2:23:15 PM                                                                                                                    
MS. BAKER  said she wished  it worked  that way, but  it doesn't.                                                               
She said one  of the Bradley units must be  shut down to preserve                                                               
the  system's stability.  HEA is  unable  to maintain  consistent                                                               
frequency with those  units when they are islanded.  She said HEA                                                               
does have  full use of the  water within Bradley, but  that it is                                                               
their water, their fuel that is  stored there and they can't take                                                               
another utility's  water. She said  during islanding  events they                                                               
then  bring on  other [energy  generation] units.  She noted  the                                                               
additional  generating   unit  required  during  the   Swan  Lake                                                               
wildfire  cost  an  additional  $25,000 per  day  for  fuel.  She                                                               
explained that the Bradly project  is not a regulating source [of                                                               
energy] and the extra unit  is required to control the electrical                                                               
frequency.  She  said  the acquisition  of  battery  storage  was                                                               
critical for HEA to cut out the extra cost of fuel.                                                                             
                                                                                                                                
2:24:53 PM                                                                                                                    
CHAIR BJORKMAN  asked for confirmation of  his understanding that                                                               
the battery  serves as  the spinning  reserve and  eliminates the                                                               
need to start up a new generation set.                                                                                          
                                                                                                                                
2:25:04 PM                                                                                                                    
MS. BAKER concurred.                                                                                                            
                                                                                                                                
2:25:11 PM                                                                                                                    
CHAIR  BJORKMAN referred  to the  suggestion in  the presentation                                                               
that an  RTO may  not go  far enough  from HEA's  perspective and                                                               
asked  for  clarification.  Specifically,  he  asked  what  would                                                               
better meet the needs of the Railbelt.                                                                                          
                                                                                                                                
2:25:34 PM                                                                                                                    
MS. BAKER  answered that HEA  is committed to the  agreement made                                                               
by  the Railbelt  [utility]  managers in  Iceland.  She said  HEA                                                               
wonders if a  Generation and Transmission (G&T) model  would be a                                                               
more appropriate vehicle. She also said  HEA does not think it is                                                               
necessary to pass legislation this  year and would prefer to take                                                               
more  time for  the  transmission group  of  experts to  consider                                                               
various models.  She restated  the goals shared  by HEA  with the                                                               
sponsors of the legislation and  the managers who met in Iceland:                                                               
economic dispatch across  the Railbelt, and the vision  of a time                                                               
when everyone served by the  Railbelt energy system would pay the                                                               
same  price.  She  noted  that  the system  in  Iceland  was  not                                                               
developed  overnight  and  is  a system  worth  looking  at.  She                                                               
considered the possibility of two  systems with Bradley under one                                                               
big G&T. She  said there are numerous things that  could be done,                                                               
and she advocated  for taking time to  consider possibilities and                                                               
to get it right. She noted  that considering the whole system and                                                               
how to move forward is very complicated.                                                                                        
                                                                                                                                
2:27:31 PM                                                                                                                    
CHAIR BJORKMAN  noted discussions about the  Electric Reliability                                                               
Organization (ERO) and its board  and the success of deliverables                                                               
from  the  ERO.  He  asked  for reflection  about  the  role  and                                                               
function of the  ERO in generation and  transmission planning for                                                               
the future from the perspective of HEA.                                                                                         
                                                                                                                                
2:28:04 PM                                                                                                                    
MS.  BAKER reflected  that the  ERO was  developed with  the best                                                               
intent and that it was charged  with a lot of responsibility. The                                                               
cost of the ERO for HEA  is $20,000 monthly; under the new tariff                                                               
which  will go  into effect  in August,  she said  the cost  will                                                               
increase 116 percent  to $43,000 per month. She  said ERO's total                                                               
budget for  2024 will  be $5  million and  that is  concerning to                                                               
HEA. She said  HEA would prefer a more  streamlined approach with                                                               
clearly delineated  responsibilities, for example having  the ERO                                                               
operate as  a standards-based organization,  developing standards                                                               
for  safe   operation  of  the  grid   and  how  interconnections                                                               
function, etc;  and the  RTO would be  the market.  She suggested                                                               
that  it is  complicated  for  the entity  that  has created  the                                                               
standards to then function competitively  in the market. She said                                                               
there is  a separation between  those duties in other  states and                                                               
that separation and clearly delineated  powers provides a cleaner                                                               
way of  doing it and  would be  beneficial for the  board members                                                               
who, she opined, all have the best intentions.                                                                                  
                                                                                                                                
2:30:27 PM                                                                                                                    
CHAIR BJORKMAN opened public testimony on SB 257.                                                                               
                                                                                                                                
2:31:06 PM                                                                                                                    
MIKE CRAFT,  representing self,  Fairbanks, Alaska,  testified in                                                               
support of SB 257.  He said he is a home  builder, the gravel pit                                                               
operator in Fairbanks,  the owner and operator of  the Delta Wind                                                               
Farm, and  that he put the  first two wind farms  on the Railbelt                                                               
grid  in 2008.  He  served on  the  Railbelt Reliability  Council                                                               
(RRC) formation committee. He said  he considers his testimony to                                                               
be part of  an intervention in that the  same conversations about                                                               
the Railbelt  grid, utilities working  better together  etc. have                                                               
been happening  for over 14  years. Meanwhile there  are hundreds                                                               
of millions of dollars spent  through the Alaska Energy Authority                                                               
to develop renewable  energy technology in Alaska,  which he said                                                               
has been  very successful. He  noted the energy goal  [50 percent                                                               
of  Alaska's power  from renewables  by  2025] set  out by  Sarah                                                               
Palin in  2010. He noted  that the situation  now in 2024  is not                                                               
enough fuel to power the capacity  in the major cities in Alaska.                                                               
He detailed recent fuel consumption  and shortfalls and the level                                                               
of  power  consumption  in  cities on  the  Railbelt  system.  He                                                               
expressed frustration  with the lack  of progress and  said there                                                               
are  a dozen  or so  [renewable energy]  projects that  have been                                                               
allowed to "die on the vine"  in the meantime. He noted that fuel                                                               
was at its highest cost and  possibly not even available. He said                                                               
the utilities are forced to burn  fuel in Fairbanks during an air                                                               
quality alert  which means poor  air quality will  be exacerbated                                                               
and  high cost.  He  said  his local  utility  had  a 21  percent                                                               
increase in rates  in the last 60 days. He  concluded saying that                                                               
he supported  all three  energy bills that  are currently  on the                                                               
table, SB 152,  SB 257 and the one addressing  wheeling rates [SB                                                               
217].  He supported  any efforts  to  open the  Railbelt grid  to                                                               
competition.                                                                                                                    
                                                                                                                                
2:34:25 PM                                                                                                                    
KEN  HUCKEBA, representing  self, Wasilla,  Alaska, testified  in                                                               
opposition to  SB 257. He said  he had experience working  in the                                                               
power  producers' world  in California  and,  in his  experience,                                                               
there were many  precautions to be taken  to prevent opportunists                                                               
and grifters and to save  ratepayers and taxpayers money. He said                                                               
those  precautions needed  to  be set  in  place before  enacting                                                               
legislation. He  opposed SB  257 and  the comparison  to Iceland,                                                               
which  he characterized  as a  nationalist  grid. He  said he  is                                                               
opposed  to  any  kind of  centralized  government  planning  and                                                               
consolidation of  private assets. He  said the entire  premise of                                                               
SB  257 is  to set  up to  beg for  and further  legitimize going                                                               
after inflationary and  damaging federal funds. It  stands up yet                                                               
another state-owned enterprise  at a time when  federal and state                                                               
spending is wildly out of  control. He said the sponsor statement                                                               
claims SB 257 lays the groundwork  for an electric system that is                                                               
more affordable,  more sustainable  and more equitable.  He asked                                                               
how  that could  be  true when  it requires  so  much money  from                                                               
ratepayers and taxpayers.  He asked for whom  the proposed system                                                               
would  be more  equitable. He  claimed SB  257 would  be taxation                                                               
without representation.  He said  central planning  is government                                                               
free-market  interference,  yet  all  the  invited  testimony  by                                                               
unelected bureaucrats  and technocrats  tells a  different story.                                                               
He noted  the claims  that SB  257 was needed  for IPPs,  that it                                                               
would  provide energy  security  and would  result in  affordable                                                               
energy  and would  allow  free and  open access  to  the grid  by                                                               
removing  barriers. He  said, if  all that  were true,  why would                                                               
[there be] subsidies  and the infrastructure charges  just to get                                                               
renewables  on there.  He  said  he did  not  see an  alternative                                                               
analysis for  the natural  gas pipeline and  yet the  position is                                                               
that's the  only way  to go forward.  He noted  invited testimony                                                               
points to  [experience of]  Texas and Hawaii  and that  they have                                                               
adopted  this   framework  yet  do   not  talk  about   what  the                                                               
detrimental energy  transition policies have done  to their grid.                                                               
He said he  read that the North  American Reliability Corporation                                                               
consider  energy policy  as a  top risk  to grid  reliability. He                                                               
said SB 257 is a great  example of exactly that energy policy. He                                                               
urged  that SB  257 be  tabled until  is more  formed to  protect                                                               
Alaskans.                                                                                                                       
                                                                                                                                
2:37:03 PM                                                                                                                    
JOEL   GROVES,  Board   Chair,   Railbelt  Reliability   Council,                                                               
Anchorage, Alaska, gave  a timeline and an overview  of the RRC's                                                               
history, current work and future  direction in order to provide a                                                               
better understanding of the RRC  and suggest implications for the                                                               
potential roll-out  of SB  257 if  the bill  passes. He  said the                                                               
Railbelt  Reliability  Council  (RRC)   spent  over  three  years                                                               
jumping through the  various regulatory hoops in  order to obtain                                                               
the  regulatory  approvals needed  to  function  as the  Electric                                                               
Reliability Organization (ERO). He  described the efforts to hire                                                               
a CEO  and reported that  appears to be nearly  complete. RRC/ERO                                                               
have  also  retained a  chief  administrative  officer and  chief                                                               
technical officer  as stop-gap measures  to get on with  the work                                                               
of the organization.                                                                                                            
                                                                                                                                
MR. GROVES said,  with the potential rollout of SB  257, he would                                                               
expect a timeline  similar to that of the RRC,  with a three-year                                                               
Senate approval window  for the RTO. He summarized  by urging the                                                               
committee and the legislature at  large to consider the realistic                                                               
timeframes for  the roll-out of  SB 257 and the  implications for                                                               
potential  outcomes for  the RRC,  including  the possibility  of                                                               
sending the  RRC back  to redo some  of the  regulatory approvals                                                               
due to the reforms implemented.                                                                                                 
                                                                                                                                
2:40:24 PM                                                                                                                    
CHAIR BJORKMAN asked what the  total revenue after the ERO tariff                                                               
was implemented for 2024 and what is expected for 2025.                                                                         
                                                                                                                                
2:40:33 PM                                                                                                                    
MR.  GROVES  answered  the  total  revenue  for  2024  under  the                                                               
currently  approved tariff  was  approximately  $2.4 million  for                                                               
2024.                                                                                                                           
                                                                                                                                
2:41:01 PM                                                                                                                    
CHAIR BJORKMAN asked whether the  amount was expected to increase                                                               
for 2025.                                                                                                                       
                                                                                                                                
2:41:07 PM                                                                                                                    
MR. GROVES  said RRC filed a  request with the commission  for an                                                               
increase   to   support   product  development,   basically   the                                                               
initiation of  reliability standards and  that is to  support the                                                               
chief technical  officer referred  to earlier.  He said  RRC does                                                               
expect a higher budget for 2025  and estimated it would be around                                                               
$5 million  with the expectation  of having  hired a CEO  and the                                                               
key staff that will begin and lead the work of the organization.                                                                
                                                                                                                                
2:42:00 PM                                                                                                                    
NATALIE  KILEY-BERGEN,   Energy  Lead,  Alaska   Public  Interest                                                               
Research Group,  Anchorage, Alaska,  said Alaska  Public Interest                                                               
Research Group  (AKPIRG) is a  501(c)(3) non-profit and  the only                                                               
non-partisan,  non-governmental  consumer advocacy  and  research                                                               
organization in Alaska. AKPIRG serves  in the small consumer seat                                                               
on the RRC.  She said her comments represent the  views of AKPIRG                                                               
and not  necessarily the RRC.  She said AKPIRG  strongly supports                                                               
the inclusion  of diverse voices  in the legislatures  efforts to                                                               
improve  transmission legislation.  Although AKPIRG  supports the                                                               
creation of  a regional transmission  entity, she said  there are                                                               
concerns  about sections  of  SB 257  that  repeal the  statutory                                                               
authority  for  Electric   Reliability  Organizations  (EROs)  to                                                               
conduct integrated  resource planning. She said  the Railbelt ERO                                                               
is  governed  by  a  board   that  includes  representation  from                                                               
providers  of  electric  energy,  transmission  and  distribution                                                               
along with  consumer voices.  She said RRC  board members  have a                                                               
fiduciary duty  to act independently  and exercise  first loyalty                                                               
to  the mission  of  the RRC  to  achieve what  is  best for  the                                                               
Railbelt. She  said Railbelt  ratepayers are  best served  by the                                                               
wholistic  planning  process  and  the inside  approach  the  RRC                                                               
already embodies.  She said  AKPIRG opposes  the notion  that the                                                               
RRC has been  operating for four years with  little progress. She                                                               
said the RRC  has been a certified ERO since  September 2022, and                                                               
in  that  time has  undertaken  substantial  effort to  create  a                                                               
framework for RRC planning and  has gone through public processes                                                               
to create rules and bylaws  to insure robust technical excellence                                                               
and substantial  public participation.  She said  AKPIRG supports                                                               
that the  proposed RTO  would oversee  and manage  the Railbelt's                                                               
key transmission  assets and the Regulatory  Commission of Alaska                                                               
would  oversee its  management.  AKPIRG would  like  an RTO  that                                                               
operates a  transmission system for  economic dispatch  of energy                                                               
across the Railbelt system. This  would best serve the collective                                                               
interest  of ratepayers.  Regardless  of  framework, AKPIRG  will                                                               
continue  to   push  for  robust  transparency   and  stakeholder                                                               
engagement  within   any  structure  and  can   provide  specific                                                               
suggestions in this direction as legislation evolves.                                                                           
                                                                                                                                
2:44:32 PM                                                                                                                    
CHRIS ROSE,  Director, Renewable  Alaska Energy  Project, Sutton,                                                               
Alaska,  said Renewable  Alaska  Energy Project  (REAP) has  been                                                               
working with  electric industry professionals and  experts around                                                               
the country on issues related  to energy efficiency and renewable                                                               
energy across the  state for the past 20 years.  He commended the                                                               
Senate Resources Committee  for its commitment to  reforms in the                                                               
Railbelt  region of  Alaska  and the  Senate  Labor and  Commerce                                                               
Committee  for  hearing SB  257.  He  noted  that energy  in  the                                                               
Railbelt region of  Alaska is 60 percent more  expensive than the                                                               
national average,  which makes  the need  for reform  more urgent                                                               
than  ever. He  said REAP  supports elements  of SB  257 but  has                                                               
grave concerns  about the provision  to move planning out  of the                                                               
Railbelt  Reliability  Council  (RRC).  REAP  supports  SB  257's                                                               
intent  to   eliminate  transmission  wheeling  charges   in  the                                                               
Railbelt,  while  they  may  prefer   language  in  another  bill                                                               
currently under  consideration. He said they  believe eliminating                                                               
wheeling  is an  important  reform that  has  been discussed  for                                                               
decades. He  said REAP also supports  enhanced qualifications for                                                               
the commissioners  on the Regulatory Commission  of Alaska (RCA).                                                               
However,  REAP does  not support  language in  SB 257  that would                                                               
take  away either  generation or  transmission planning  from the                                                               
RRC.                                                                                                                            
                                                                                                                                
2:45:52 PM                                                                                                                    
MR.  ROSE  said  in  the  lower  48,  there  are  seven  Regional                                                               
Transmission  Organizations  (RTOs), and  all  of  them with  the                                                               
exception  of Electric  Reliability Council  of Texas  (ERCOT) is                                                               
governed by a  board that is independent of the  owners and users                                                               
of  the  transmission  system. He  said  RTO's  with  independent                                                               
governance in the  lower 48 do conduct  transmission planning and                                                               
much  of the  latest thinking  in  the field  is that  conducting                                                               
transmission and generation or resource  adequacy planning may be                                                               
better done by the same body.  In addition, RTO's in the lower 48                                                               
also act  to dispatch generation  resources on the system  in the                                                               
most economical  way to benefit  consumers. In contrast,  he said                                                               
REAP believes it's  important to note that the  governance of the                                                               
RTO  as contemplated  in  SB  257 within  the  co-ops and  Alaska                                                               
Energy Authority  (AEA) is not independent.  There is independent                                                               
industry  literature  and  precedent   from  the  Federal  Energy                                                               
Regulatory Commission  (FERC) that  explains why  independence is                                                               
so important, but  the essential point is that the  owners of the                                                               
transmission  system  all  have   inherent  biases  and  economic                                                               
interest,  and  putting  those  owner's  interest  in  charge  of                                                               
planning the  system or dispatching generation  resources sets up                                                               
the real danger that the interest  of one or more of those owners                                                               
will  dominate the  decision-making. He  said that  it is  highly                                                               
important  that the  decision to  build transmission  be made  by                                                               
decision-makers  that   do  not  have  any   local  or  parochial                                                               
interest.                                                                                                                       
                                                                                                                                
MR.  ROSE  concluded  that  REAP   is  not  confident  the  RTO's                                                               
governance  as described  in SB  257 will  protect consumers.  He                                                               
said most  of the  litigation between  the Railbelt  utilities of                                                               
Alaska over the  past several decades has been over  the issue of                                                               
transmission. He said  it is not reasonable to think  that an RTO                                                               
composed of the transmission owners  would be able to effectively                                                               
plan for the transmission system without major disputes arising.                                                                
                                                                                                                                
2:47:57 PM                                                                                                                    
ALEX  PETKANAS, Climate  and Clean  Energy  Program Manager,  The                                                               
Alaska Center,  Anchorage, Alaska,  said SB  257 would  have some                                                               
very  positive  impacts   including  increased  requirements  for                                                               
future RCA  commissioners and allowing  additional considerations                                                               
like diversity of supply and  the determination of utility areas.                                                               
However,  he  said  the  Climate and  Clean  Energy  Program  was                                                               
concerned that removing  some or all planning  authority from the                                                               
existing Electric  Reliability Organization (ERO) would  create a                                                               
slower  and less  efficient process  with less  public input  and                                                               
transparency.  He  said  the  ERO  represents  a  wide  range  of                                                               
stakeholders that establish clear  methods for engagement to take                                                               
significant  steps  toward  developing  wholistic  standards  for                                                               
power generation.  He said requiring the  Alaska Energy Authority                                                               
to  begin an  initial  plan and  an RTO  to  take over  long-term                                                               
planning  at this  point would  undermine work  that has  already                                                               
been  done  and  would  complicate and  slow  down  the  process.                                                               
Establishing  a new  organization  takes time  and planning  work                                                               
would not  start immediately. Additionally, he  said debates over                                                               
exactly  who  gets  to make  certain  transmission  and  planning                                                               
decisions  would further  slow the  process.  He said  SB 257  as                                                               
written requires the  EROs to work with the RTO  on planning, but                                                               
it is  not clear exactly who  gets final say over  each aspect of                                                               
transmission. He  said there  is no evidence  at this  point that                                                               
creating  a  new  organization   would  be  more  efficient  than                                                               
allowing  the existing  ERO  to  continue its  work  to create  a                                                               
wholistic plan for the Railbelt  energy system. He concluded that                                                               
the  Climate  Clean  Energy  Program  strongly  opposes  removing                                                               
planning authority from the ERO.                                                                                                
                                                                                                                                
2:49:40 PM                                                                                                                    
ANTONY SCOTT,  representing self, Anchorage, Alaska,  said he was                                                               
testifying from his  perspective as a former  commissioner of the                                                               
Regulatory Commission  of Alaska. He  said SB 257 in  it's intent                                                               
to create a Regional Railbelt Transmission organization is well-                                                                
meaning,  but that  there are  important technical  flaws in  the                                                               
bill.  He  said  the  source  of the  defects  have  to  do  with                                                               
overlapping jurisdictional authority  and concerns about property                                                               
rights. He said  he had three areas of concern,  not with policy,                                                               
but concerns with the construction of the authority of the RTO.                                                                 
                                                                                                                                
MR.  SCOTT said,  though there  is intent  that the  entity [RTO]                                                               
would   be  regulated   by  the   RCA,  there   would  still   be                                                               
jurisdictional   and    non-jurisdictional   portions    of   the                                                               
transmission system as  is the case today. He  noted the portions                                                               
of  the transmission  system that  are  currently governed  under                                                               
certain  Bradley  Lake  agreements  and the  exemption  of  those                                                               
Bradley  Lake  agreements  are  under  AS  42.05.431(c)  and  not                                                               
addressed in the language [of SB 257].                                                                                          
                                                                                                                                
2:51:14 PM                                                                                                                    
MR. SCOTT said  the concept of "backbone"  transmission assets is                                                               
a more significant  concern. He said that concept  does not self-                                                               
execute,  and he  is concerned  that it  will create  significant                                                               
litigation and  future conflict. The  fact that it  doesn't self-                                                               
execute is  called out by the  need for new regulations  under SB                                                               
257  defining  that,  but  he  said  it  is  not  clear  what  is                                                               
contemplated by  "backbone". He  pointed out  that ten  years ago                                                               
there was  very extensive and  expensive litigation  over whether                                                               
the  transmission lines  connecting  Chugach's generation  assets                                                               
west of  the grid were  "backbone" or instead were  "radial". The                                                               
RCA came up with one answer,  but it is unclear what the drafters                                                               
of SB 257 had  in mind. He said this is  a very significant issue                                                               
for   local  utilities   which   have   transmission  assets   to                                                               
potentially  being  able  to meet  their  Certificate  of  Public                                                               
Convenience and  Necessity (CPCN) obligations when  management of                                                               
certain assets may be handed over to the RTO.                                                                                   
                                                                                                                                
MR SCOTT sought to address  issues over overlapping jurisdictions                                                               
and  the prospects  of litigation  that are  created by  that. He                                                               
summarized  that   he  has  significant  concerns   with  several                                                               
provisions of SB  257 regarding the powers and duties  of the RTO                                                               
that  have been  enumerated  and overlapping  authority with  the                                                               
RCAs' jurisdiction.                                                                                                             
                                                                                                                                
2:53:06 PM                                                                                                                    
DAVID NEWMAN, representing self, Fairbanks,  Alaska said he was a                                                               
faculty member  at UAF in physics  and that he had  studied power                                                               
transmission,  blackouts and  resource  adequacy  issues for  the                                                               
last 30  years. He said he  had worked at the  academic level and                                                               
at  the practical  level,  doing projects  for  entities such  as                                                               
California  Independent  System  Operator (ISO),  which  he  said                                                               
operates basically  like an RTO.  He noted  the "I" in  ISO which                                                               
stands for "Independent".  He said the sponsor's goal  for SB 257                                                               
is fabulous and he offered full  support for those goals. He said                                                               
independent,  but  unified  planning  is critical.  He  said  the                                                               
planning  organization   must  do  both  resource   planning  and                                                               
transmission planning  to maximize economic dispatch  and achieve                                                               
system  reliability. He  said one  without  the other  is a  real                                                               
problem  and has  been experienced  across the  country. He  said                                                               
Regenerative Fuel Call (RFC) is  just getting started now, but he                                                               
said  its  mission  is  the  same  as  that  of  SB  257  in  the                                                               
organization  of  an  RTO.  He   said  IRPs  in  particular  need                                                               
integrated  planning with  cost and  reliability included  and he                                                               
opined that the  proposed entity would be  reinventing the wheel,                                                               
but  worse. He  said  the flaw  is  that it  would  no longer  be                                                               
independent. He  said one of  the things that contributed  to the                                                               
development  of  the   RRC  board  is  that  though   it  is  not                                                               
independent, it is balanced among the stakeholders.                                                                             
                                                                                                                                
MR. NEWMAN concluded  that he supported the  establishment of the                                                               
RTO in SB 257,  but did not support the bill  in total because he                                                               
said it would  make costs higher, reduce  reliability and violate                                                               
the principles of equal representation.                                                                                         
                                                                                                                                
2:56:20 PM                                                                                                                    
MARYLEE GUTHRIE,  representing self, Fairbanks, Alaska,  said she                                                               
was a  resident with old electric  heaters in her house  and that                                                               
she had been  paying electric bills and watching  things going on                                                               
in Golden  Valley Electric Association (GVEA)  in particular. She                                                               
said she  was very  happy a  few years  ago when  the integrated,                                                               
independent and  transparent processes of the  board to integrate                                                               
the various pieces  of the Railbelt came into  existence and very                                                               
hopeful that it  would be a way  to help all move  forward in the                                                               
new  energy situation.  She  said she  was  concerned that  those                                                               
features  [integrated, independent  and  transparent]  are not  a                                                               
robust part of SB 257.                                                                                                          
                                                                                                                                
2:57:39 PM                                                                                                                    
CHAIR  BJORKMAN noted  that changes  are  coming and  are in  the                                                               
works   that  will   protect  utilities   like  Homer   [Electric                                                               
Association]  and others  from islanding  issues and  making sure                                                               
that  de-constraining  the system  is  prioritized  prior to  any                                                               
costs being  assessed to utilities  that may  not be served  by a                                                               
system under constraint.                                                                                                        
                                                                                                                                
2:58:20 PM                                                                                                                    
[CHAIR BJORKMAN held SB 257 in committee.]                                                                                      
                                                                                                                                
2:58:28 PM                                                                                                                    
There being  no further  business to  come before  the committee,                                                               
CHAIR BJORKMAN  adjourned the Senate Labor  and Commerce Standing                                                               
Committee meeting at 2:58 p.m.