Conservation Watch #12 - 4/6

In This Issue:
* One electric corporation: GRETC

* ACA and Enstar's natural gas line
* On The Move
* New In Town

*Other Bills
* Calendar

One electric corporation to rule them all

 Gov. Palin's Greater Railbelt Energy and Transmission Corporation

One of the more significant pieces of energy legislation being considered this year is SB 143 and HB 182 targeted at uniting the six Railbelt utilities into the Greater Railbelt Energy and Transmission Corporation (GRETC).
Based on a finding in the Alaska Energy Authority's Railbelt Electrical Grid Authority study, the Palin Administration is proposing a unified a Corporation aimed at  ensuring  adequate electricity generation and transmission assets to meet customer demand at the lowest feasible cost.
Currently, the entire Railbelt transmission grid, running from Homer and Seward to Fairbanks, carries about the same amount of electrical energy as a single small -sized power plant in the lower 48 - about 875 megawatts. However, the Railbelt  grid is populated by six separate utilities. These utilities own and operate dozens of electrical generators – predominately natural gas, hydroelectric and coal. These utilities have to finance their own capital for new generation facilities and negotiate fuel prices alone. Being six small utilities limits their ability to finance capital-intensive projects. A recent example is the Bradley Lake hydroelectric plant located near Homer. Finished in the early 1990s, Bradley Lake was a state-financed project, being too capital intensive for any one utility. However, now Bradley Lake delivers some of the cheapest electricity to the Railbelt grid, $0.04 per kilowatt hour. By bringing all six utilities under the control of a single corporation, GRETC could more easily finance expensive projects.
At the March 19 Senate Energy Committee meeting, a spokesperson from the consulting firm Black and Veatch presented his company's findings on the possible form and future of GRETC. The consultant Black and Veatch ran price estimates for four different fuel scenarios. One scenario estimated that energy demands would be met by a combination of large hydroelectric, demand side management (managing the use of electricity,) energy efficiency and other renewable energy sources. Other estimates came from coal only, natural gas only or a mix of all possible fuel sources. The consultant determined that if the Corporation can procure tax-free funding,  Alaskans would see the most savings from an energy paradigm of  clean energy, demand side management and energy efficiency.
As proposed in the legislation, utility participation in GRETC is voluntary. Golden Valley Electric Association and Municipal Light and Power (ML&P) have voiced some  concerns over participating in GRETC. Golden Valley recently invested in new generation and ML&P has the Railbelt's lowest electric rates due to new gas generation and savvy fuel purchases. Matanuska Electric Association, however, asked Senate Energy Committee members to make participation mandatory. Seward Electric Association, being a city-run utility, would need consent from voters.
The Palin administration would like to see GRETC legislation pass this year with a revisit in 2010. However, Special Assistant to the Governor, Joe Balash said the administration wants to work with the utilities to get GRETC passed into law. "We're not trying to jam anything down their throats," Balash said.
Both SB 143 and HB 182 are up for hearings this week.

Did you hear that ACA endorsed the Enstar route?

It has come to our attention that due to an inaccurate press release from Senator Murkowski’s office some Alaskans believe that Alaska Conservation Alliance as well as other conservation groups are supporting the entire Enstar bullet gasline down the Parks Highway. This is not the case. We simply agreed to help Enstar and the National Park Sevice move forward with a Title XI process through Denali National Park. As you will note by this letter to Enstar, ACA is not “endorsing” the Enstar bullet line itself or above any other gas project. This was also made clear in the revised press release from Senator Murkowski’s office (insert link). ACA is eager and willing to engage in solutions to our state’s energy challenges but is not interested in getting  in the middle of industry competition or disputes. ACA remains committed to working with state and industry leaders in addressing our energy challenges and the need for a comprehensive energy plan.

On The Move

SB 71 Alternative Energy For Public Works - Sen. Therriault (R-North Pole)
Sponsored by Senator Therriault, SB71 would encourage new public works facilities to use alternative (defined as non fossil fuel) energy as primary or secondary heat or electricity sources whenever the cost is comparative to fossil fuels. The bill was moved out of Senate Resources Committee last week. ACV supports this bill.

SB 108 Stampede State Recreation Area – Sen. Thomas (D-Fairbanks)

SB108 would create the Stampede State Recreation Area. ACV supports this bill. This bill was referred to both Resources and Finance committees and was heard in Senate Resources last week. It is scheduled for another hearing in Resources on Friday, April 10 at 3:30 pm room 205.

SB 116 Appropriation: Rural Energy Assistance – Senate Finance Committee
This is a revised and expanded version of Senator Hoffman’s bills to extend energy cost assistance to low income Alaskans. This approach drops a proposed new program for this purpose and simply places $9 million (up from the initially proposed $5 million) into the federal Low Income Heating Assistance Program and the Alaska Heating Assistance Program.  SB 116 passed the Senate last week and has been sent to the House where it received a House Finance Committee referral. ACV supports this bill.

SB 150 Emerging Energy Technology Fund – Sen. McGuire (R-Anchorage)
One of ACV’s legislative priorities, we are pleased to see SB150 finally in motion.  This bill would create an emerging energy technology fund through the Alaska Center for Energy and Technology to provide grants and loans to eligible applicants for research, development or demonstration projects designed to test new energy technologies of conserving energy and/or improving an existing energy technology.  The bill received a great deal of support at its first hearing in Senate Energy where it was heard and held.  Senate Energy was able to pick the bill up again on Friday and passed it on to its next committee, Senate Resources which then sent it on to Senate Finance. Senate Finance heard testimony on Monday and held the bill.

HB 163/ SB 135 Alaska Natural Gas Development Authority - Rules by Request of the Governor
This late arrival is one of several bills recently introduced by the Governor.  HB163 and SB135, companion bills, would clarify and broaden the scope of the Alaska Natural Gas Development Authority.  The bills have Energy, Resources and Finance referrals in both bodies.  SB135 was heard and held last Thursday in Senate Energy. HB163 had its first hearing in House Energy and was heard and held. HB163 is scheduled for House Energy April 9 at 3:00 pm in room 124. Questions have been asked about whether the amendments will actually make any difference in getting a pipeline built.

HB182 / SB 143 Railbelt Energy & Transmission Corp. – Rules by request of the Governor
SB143 and HB182 are companion bills from the Governor to establish the Greater Railbelt Energy and Transmission Corporation – the entity that would unite the various utility operators on the Railbelt (GVA, MEA, HEA, ML&P, Chugach). Both bills have referrals to Energy, Resources and Finance committees and both have had just one hearing in their respective Energy Committees.  This is a complicated arrangement that is still a work in progress. Legislators are curious about oversight of the corporation, potential power sources and utility buy-in.  House Energy committee will hear HB 182 Thursday, April 9 at 3:00 pm in room 124. SB 143 was scheduled in Senate Energy on Monday, April 6 at 5:00 pm in room 205.

HB 20 Fisheries Loans for Energy Efficiency - Rep. Edgmon (D-Dillingham) | Rep. Buch (D-Anchorage) | Rep. Austerman (R-Kodiak) | Rep. Thomas (R-Haines) | Rep. Wilson (R-Wrangell) | Rep. Munoz (R-Juneau) | Rep. Johansen (R-Ketchikan)
ACV supports HB20, a bill that adds efficiency upgrades as a possible criteria for commercial fishing loans. HB20 finally passed through House Finance where some unexpected criticism of the bill cropped up because the loans aren’t available for sport fishing. In the end the HB20 passed with only two 'no' votes. It has been referred to House Rules.

HB 49 Eminent Domain: Recreational Structures – Rep. Johnson (R-Anchorage) | Rep. Ramras (R-Fairbanks) | Hawker | Rep. Lynn | Rep. Tuck (D-Anchorage)
Hawker | Rep. Lynn | Rep. Tuck (D-Anchorage)
HB49 would amend the State’s eminent domain laws to prohibit the exercise of the power of eminent domain on recreational structures for the purposes of developing a recreational facility or project. It passed out of the House last month with strong support and was to have its first hearing in Senate Judiciary on April 3, but the meeting was canceled. It has yet to be rescheduled.

HB 121 Municipal Air Quality Property Tax Credit – Rep. Coghill (R-North Pole) | Rep. Kawasaki (D-Fairbanks) | Rep. Gara (D-Anchorage) | Rep. Ramras (R-Fairbanks) | Rep. Kelley (R-Fairbanks) | Rep. Harris (R-Valdez)
Like SB93, this bill would allow a municipality to provide an ‘air quality improvement tax credit’ to partially offset the property taxes on a property that is improved in such a way as to improve the air quality in the municipality. Already through House CRA, HB121 was heard in House Finance on Friday morning.  ACV Executive Director Kate Troll testified in favor of the bill, adding a suggestion that the option for a tax credit l not only apply to municipalities with poor air quality but all municipalities. Finance passed  a committee substitute  out of committee last week. An amendment to HB 121 narrows the scope of the bill, limiting tax credits to areas that fail to meet Federal or State air quality standards for PM2.5. It is now in the Rules Committee poised for floor action

HB 134 Cruise Ship Wastewater Discharge Permits – Rep. Harris (R-Valdez | Rep. Kelly (R-Fairbanks) | Rep. Millett (R-Anchorage) | Rep. Johansen (R-Ketchikan) | Rep. Foster (D-Nome) | Rep. Keller (R-Wasilla) | Rep. Chenault (R-Nikiski) | Rep. Coghill (R-North Pole) | Rep. Johnson (R-Anchorage) | Rep. Wilson (R-Wrangell) | Rep. Munoz (R-Juneau)| Rep. Hawker (R-Anchorage)
HB134 has gone through many changes since its introduction and after several  hearings and some productive  dialogue the current version is considerably better than the original version. . As it is currently written, the bill would allow the Department of Environmental Conservation (DEC) to issue a two-year permit to the cruise ship to exceed waste discharge limitations if they can demonstrate that it is not economically of technologically feasible to meet the required water quality standards. The bill also establishes a science advisory panel to assist and advise DEC in conducting the analyses and preparing reports on methods to prevent pollution. While the bill sets a time limit of 2014 for the advisory panel it does not set a similar limitation for the mixing zone exemption. The Committee Substitute for HB 134 passed the House with only two legislators voting against it. CSHB 134 was heard in Senate Resources on Monday, April 6 and held over for continued public testimony.

HB 194 Low-Speed Motor Vehicles – Rep. Wilson (R-Wrangell)
HB 194 has the same language as the current CS of SB59, a bill with the same title.  This bill allows the operator of a low-speed vehicle to operate on a highway with a maximum speed limit of 45 miles an hour if the highway is within a municipality that has a population of less than 35,000; is not connected by road to Anchorage or Fairbanks; and has passed an ordinance allowing for the operation of low-speed vehicles.  It passed out of House Transportation and moved on to House  Judiciary for a hearing on  Wednesday, April 8 at 1:00 pm in room 120.  ACV supports this bill.

HCR 2, HCR 3, HCR 4 and HCR 5 In-State Gas Pipeline - Rep. Ramras (R-Fairbanks) | Rep. Millett (R-Anchorage) | Rep. Johnson (R-Anchorage) | Rep. Chenault (R-Nikiski) | Rep. Hawker (R-Anchorage) | Rep. Dahlstrom (R-Anchorage) | Sen. Therriault (R-North Pole) | Sen. McGuire (R-Anchorage) | Sen. Meyer (R-Anchorage) | Sen. Huggins (R-Wassilla) | Sen. Stevens (R-Kodiak) | Sen. Wagoner (R-Kenai) | Sen. Bunde (R-Anchorage)
These bills relate to providing energy security for Alaskans by working to support a gas “bullet” pipeline to meet in-state energy needs.  All four of these resolutions have passed Senate Resources and are on their way to Senate Finance.

HJR 25 Hydroelectric Power; Renewable Energy – Rep. Thomas (R-Haines) | Rep. Johansen (R-Ketchikan) | Rep. Edgmon (D-Dillingham) | Rep. Millett (R-Anchorage) | Rep. Austerman (R-Kodiak) | Rep. Kerttula (D-Juneau) | Rep. Munoz (D-Juneau) | Rep. Wilson (R-Wrangell) | Rep. Johnson (R-Anchorage) | Rep. Dahlstrom (R-Anchorage) | Rep. Gruenberg (D-Anchorage) | Rep. Crawford (D-Anchorage) | Rep. Gardner (D-Anchorage) | Rep. Tuck (D-Anchorage)
HJR25is a resolution from the Alaska State Legislature urging the United States Congress to take the necessary action to classify hydroelectric power as a renewable and alternative energy source so that the state can participate in federal programs without restriction to facilitate development of the state's hydroelectric resources for the benefit of its residents. The resolution focuses on “high elevation lakes and run of river systems that have few or no negative environmental effects”. HJR25 was moved from House Energy and referred to House Resources.

SJR 7 Opposing a United Nations designation of the Arctic Ocean as a World Heritage Site - Sen. Therriault (R-North Pole) | Sen. Dyson
In SJR 7 the sponsors ask the Alaska State Legislature to oppose, and encourages the United States, on behalf of Alaska, its only Arctic state, to oppose, any effort by the United Nations to designate any portion of the Arctic Ocean as a World Heritage Site or similar designation that would impinge on the sovereignty of the United States. It was scheduled for hearing on  Monday, April 6 in  Senate Energy.

SSHB 36 An Act relating to ballot initiative proposal applications and to ballot initiatives - Rep. Johansen (R-Ketchikan) | Rep. Millett (R-Anchorage) | Rep. Johnson (R-Anchorage)
SSHB 36 makes four key  changes to the initiative process. One change would impose a two-year moratorium on restarting a defeated initiative. Because of the timing of filing this requirement would in reality turn into a four-year delay. Another change, would require the sponsors to hold public hearings in at least 30 house districts within one year after the Application is certified. A third change would tip the balance of power in the initiative process toward the Legislature, requiring a standing committee of the Legislature to review each initiative certified by the Lieutenant Governor for the ballot. And the fourth  change , requires petitioners to disclose who contributed to their efforts before the Lieutenant Governor approves the ballot proposal. SSHB 36 was heard for the first time in Judiciary on Monday, April 6.  At the Monday House Judiciary committee hearing, committee members voiced concern that the requisite 30 meetings would be too onerous a requirement of an initiative sponsor. SSHB36 was held - delayed to immediately after session. ACA strongly opposes this bill.

New In Town

 HB 218 would transfer the Alaska Energy Authority, the Alaska Natural Gas Authority and home energy and weatherization program to the Department of Energy. The bill's goal is to make the state’s energy programs and agencies more efficient. The state currently has several energy programs and agencies tasked with everything from home weatherization to in-state gas pipeline development spread across several departments. On Monday, HB 218 was read into the record and referred to the Energy and Finance Committees. In a press release accompanying the roll out of HB 218 the sponsors state that the House Special Committee on Energy will work with the Palin administration and House Finance Committee over the interim to fine-tune the legislation for consideration next session. The Governor issued a subsequent, press release welcoming this proposal as long as it is revenue neutral. The conservation community believes that a “one stop shopping approach” to energy governance is an important next step. We applaud this conversation starter.

 HB 210 designates Kinzarof Lagoon as part of the Izembek State Game Refuge. It authorizes a land exchange with the federal government in which state land adjacent to the Izembek National Wildlife Refuge and within the Alaska Peninsula National Wildlife Refuge is exchanged for federal land to serve as a road corridor through the Izembek National Wildlife Refuge and federal land located on Sitkinak Island.HB 210 will be heard in House Resources on Wednesday, April 8 at 1:00 pm in room 124.

 HB 214 authorizes the Department of Environmental Conservation to award grants for the control of air emissions or the development and administration of air quality control programs. HB 214 will be heard in Finance on Tuesday, April 7 at 1:30 pm in room 519.

Other Bills

Another late arrival from the Governor’s office – HB 164 and SB 136, companion bills, relate to noncompetitive leases of state land and for rights-of-way for oil or natural gas pipelines that originate and terminate within the state. This bill also addresses the regulation and certification of those pipelines and conditional certification for new natural gas pipelines The bills have Energy, Resources and Finance referrals in both bodies.  Both SB136 and HB163 were heard and held.  Legislators had many questions about the bill but no additional hearings have been scheduled.

SB162 would establish a program in the Department of Commerce, Community, and Economic Development, Whenever the average monthly light sweet commodity price per barrel of low sulfur, easily refined grade of crude oil, traded on the New York Mercantile Exchange for the previous month exceeds $75, the retail price of heating fuel would be reduced by between $2.50 and $3.  The bill received Senate Energy, Resources and Finance referrals. It was heard and held in Senate Energy.

HB46, introduced by Representative Seaton, is a combination of two of his bills from last year designed to give Alaskans more information about what is being discharged into Alaska’s water and stopping some mixing zones.  HB46 would require the Department of Environmental Conservation to collect and make available to the public certain information relating to water pollution and prohibit certain mixing zones in freshwater spawning waters. HB 46 also requires a public comment period for certain sewage system or treatment works modifications.  It was heard and held in Fisheries where there was very little public testimony.  ACV supports this bill but it seems unlikely that it will receive much more attention in the closing days of this session.

HB66 directs the implementation of net energy metering by certain retail suppliers of electricity in order to promote the use of alternative energy resources from solar, wind, tidal, geothermal, or hydropower sources to complement electrical distribution using power generated by retail supplies. At its first hearing last week it was heard and held.  ACV supports this bill.

This bill would create the Southeast Energy Fund, a fund that would make grants for power projects, the repayment of loans and the payment of bonds for hydroelectric projects serving Southeast Alaska or for other projects to assist in meeting the energy needs of Southeast Alaska. HB166 was referred to House Energy and Finance Committees. HB 166 is the companion bill to SB 132. Last week HB 166 was moved out of House Energy and referred to House Finance. No appropriation has been attached to this bill. No hearing has been scheduled. ACV supports this bill.

This bill changes the definition of alternative energy, allowing high efficiency wood pellet stoves to be eligible for the alternative energy revolving loan fund. It also has several technical provisions, including an interest rate formula and range. House Energy moved CSHB 196 out of Committee. It has not been scheduled for another hearing.

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