Harris, Whitaker call for multibillion-dollar action on Alaska energy plan
Published Friday, July 4, 2008
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Stumble It!JUNEAU — A new proposal by House Speaker John Harris would lend support to a major Fairbanks energy project and could dwarf Gov. Sarah Palin’s short-term energy plan.
The proposal would expand the renewable energy fund created earlier this year to include projects involving synthetic fuels made from coal, biomass and natural gas. It would also make an informal promise to put $21 billion in state money toward various energy projects, or roughly 85 times the $250 million lawmakers have promised already. (The bill includes intent language rather than a direct appropriation.)
Harris, a Valdez Republican, said Thursday he developed the proposal in collaboration with Fairbanks North Star Borough Mayor Jim Whitaker in large part to allow state funding for the synthetic fuels project currently being pursued by the borough and the Fairbanks Economic Development Corp.
Harris said the proposal would allow “medium-term fixes” to complement the governor’s short-term proposal to suspend the state’s motor fuel tax and give every Alaskan $1,200.
“It’s a nice thing,” he said of the governor’s plan, “but it doesn’t solve any problem long-term. That’s what I’ve asked her to do.”
Harris said he has long supported moving ahead with major energy projects like a dam on the Susitna River, expanded transmission lines along the railbelt and geothermal development near Kotzebue.
Whitaker said Thursday his interest was in using state and federal funds to support viable projects that could reduce energy costs for Alaskans.
He said the $21 billion figure grew out of conversations with Harris and Palin.
“It had to be big enough and bold enough to be meaningful — and to provide some hope to Alaskans,” he said.
Lawmakers included $300,000 in this year’s capital budget to help study the Fairbanks synthetic fuels project, which would use coal to produce liquid fuels. Total construction costs are expected to range from $500 million to $2 billion, although Whitaker said he would ask the state to cover only a fraction of that.
Palin spokeswoman Sharon Leighow said Thursday the governor supports the concept of Harris’ proposal but recognizes it’s not a final product.
“She’s considering everything at this point,” Leighow said.
Palin included energy relief on the agenda for a special legislative session later this month that will address the TransCanada gas pipeline proposal. She offered her own plan as a starting point and allowed other energy-related proposals to be considered during the session, including those dealing with the renewable energy fund and the state’s Power Cost Equalization program.
The PCE program subsidizes the cost of electricity to residential customers and community facilities in high-cost areas, but doesn’t cover businesses and is capped at a level below current electricity prices. Sen. Lyman Hoffman, D-Bethel, and other lawmakers have expressed an interest in expanding the program.
The special session is scheduled to begin Wednesday in Juneau.
For more news from the capital, visit www.newsminer.com and look for the Capital Focus blog.
Community Discussion
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Here's the best way to provide affordable energy:
1. For Immediate relief, sell State royalty oil at an affordable price for home heating so that Alaska government is not directly responsible for bankrupting us this winter.
2. State investment in a 24/7 crash program to get the 300 million dollar mothballed Healy power plant up and running. Get it running within 120 days. They've been squabbling about this disaster for years. Time for Palin to step up to the plate and demonstrate some leadership on this.
3. Begin construction of the Susitna dam ASAP. That has been studied to death, too. 120 million has already spent on studies. (Does this state know how to actually build anything? Or do we just study things in perpetuity?)
4. Build the Alaska gasline they keep talking about. An Alaskan line, not a Canadian line. Don't leave us dependent on a foreign country.
Are you listening, Juneau?
Maybe there is a reason the Susina Dam has not been built. Building dams on glacial rivers is a ridiculous idea. The silt load would fill up the dam in no time.
The State of Alaska's oil revenue is flowing into the piggy bank full bore. Short term energy relief for ALL ALASKANS is a top priority. But finally the message is soaking in that ALASKA needs an alternative to OIL for our energy needs.
Invest wisely and for the benefit of ALL ALASKANS. The possibilities are endless, if we don't get bogged down in local greed and petty politics.
Expanding the scope of the "Alternative Energy Fund" to include medium term solutions of natural gas and synthetic fuel made from Alaska's abundant coal, are steps in the right direction. But let's not forget; geothermal, wind, tidal, hydro and other renewable energy sources in the process. Nor should we ever forget that environment and beauty of ALASKA is our eternal gift for each of us to enjoy and protect.
Dont we ever learn,, giving money to FEDCO is like giving a bottle to a drunk, it will soon be gone with little or no results, except and empty bottle. How many new "non_profits" will grow from this great idea? Do you really think FRDCO could pis---- away that much money or will they need help? Perhaps the Mayor is looking for his "retirement job".
SamBam makes more sence than all the others put together, sure bet he will not run for office....
Immediate Energy Cost Relief
1. Implement a fuel cap program and sales tax relief:
1. An Alaska State Royalty Oil In-State Use Program which would use Alaska State Royalty Oil, be refined at Flint Hills, and the fuels be sold to Alaskans at no more than $2.00 a gallon. The idea is to keep fuel costs the same for every community in Alaska and keep the Flint Hills refinery operating which provides 155 jobs in Fairbanks, 25 jobs in Anchorage and millions into each economy.
2. A State Sales tax waiver reimbursement program for communities that tax fuel and electricity
Syn gas cost$500 million to 2 billion and Whitaker said he would only ask the State to cover a fraction of it. Why didn't he say who he expected to cover the rest. 21 billion dollars to produce alternative energy for 700,000 people. What does that figure out to per person? The problem is the minute you leave it to the Alaskan government, it will have the highest price tag and over ride cost. How many more billions would be added to the figure it the pipeline was built also, try 30 to 40 billion. Add the two together and you get up to 60 billion. Even Alaska doesn't have this kind of money.
This is what you get when politicians venture into an area they know nothing about.
1.Subsidize Electricity in the interior short term while we build a natural gas generator on slope and build infrastructure to bring electricity down and connect up to the state electrical grid.
2. Home owners can use electricity to help heating this winter. Using electicity heat short term per day when load on system is the lowest.
3. Start all alternate energy projects we can ASAP. We can put river wheel generators in a lot of places to generate electricity without silt build up problems.
4. Cheap electricity for all, why do we only concern with home owners relief and not business. Does anyone understand economics anymore, if cost to run a business is high, those cost are past on to the consumer/homeowners paying these cost also. Businesses provide employment that pays the bills. Quit vilifying all business, without them your lifestyle would not exist. What do you want to do go back to home farming, making your own cloths, stacking wood all summer to keep warm all winter with candles for light!
Every day there is more methane leaking out of the North Slope and getting lost to atmosphere than a big steel pipeline will ever send to Canada.
This lost orphan methane is 23times more powerful greenhouse-gas than CO2.
A network of HDPE-gas-gathering pipes will quickly amortize.
www.fairbanksgas.com
=====================
A natural-gas electric powerplant on the North Slope???
NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NO,NOT!! NOPE!!!
WHY???
....it will make too much heat in a thermal-danger zone.
Just fly over Prudhoe while wearing infrared goggles, you'll get the picture.
....Where to put a NS-gas powerplant then??
====anywhere south of Sukakpak Mountain.
HDPE-gasline can quickly hook it up to NS-gas.
www.fairbanksgas.com
=====================
Denying Alaskans access to their own hydrocarbons is just plain nuts.
It's like Kansas telling it's citizens they can't eat wheat...
.."All wheat must be exported to Mexico to meet the policy of monetization, this is how the lawyers interpret the state constitution"...
this is the same type of logic Josef Stalin used in the Ukraine in 1932, and it killed millions [several of my 2nd cousins too]
NUTS!!!
nuts, I tell you, just plain nuts
Don't send a lawyer to get a gallon of milk out of a cow..
he will burn the barn down every time.
......flash/rumble
A coal to liquids plant can produce syn diesel at a cost of around $70 a barrel. Once it is built and gas comes to town gas could be an additional feed stock as well as coal.
High oil costs? Yes. Interesting Link http://www.spiegel.de/international/busi...
AKhusky:
FYI In the early 1960s, several hydroelectric dams were built on the "MUDDY MO" aka Missouri River. Five of these were in the Dakotas alone. I lived there at the time and this river looked exactly like the Tanana and earned its name as the Muddy Mo. 48 years latter, all the dams are still operating properly providing CHEAP electricity to the Plain States and providing a world class clear water (i.e. Salcha river quality) fishery for several species of fish. As an example, a family member lives in a 1200 square foot 2 bedroom, 2 bath Condo with electric heat and the total electric bill has not exceeded $103.00 a month even during their cold winters (it was generally colder there this winter than Fbks) and hot summers!! It's nice to visit there and see a dam using the same resource over and over as the river travels through the state. Since moving to Alaska 35 years ago, it has constantly amazed me that Alaska hasn't used this great resource to it's greatest potential. Of course, we all know the answer and it started with the snail darter in the Tennessee Valley Authority! Way to go envirionmentalists! This is posted for info only. Nuff Said.
internationa...
yes, interesting link to der Spiegel.
It shows to go ya, about how the big fish eat the little fish.
The state of AK [and all other gummervints in america] wittingly/unwittingly ensure the big fish will always dominate the little fish.
Take Frank Pringle for example, his technology can totally transform how humans deal with hydrocarbons from A to Z.
http://www.globalresourcecorp.com/Engine...
Recently big-oil in Houston has invited him in to begin "signing papers".. the press says big-oil is interested in "reducing viscosity in pipelines".. [bye-bye Frank!!]
If Juneau would support a klystron-hydrocarbon research facility for Fairbanks the "bang for the buck" would be a God-Send for Alaskans.
Don't hold your breath for this to happen.
"Just why do think we call ourselves The Power Company"
...it's because we train you in school how to obediently play "Heads We Win, tails you lose"
Does anybody have any info that this $21billion will actually be an "incubator fund" for small biz ???
BigOil and Government both have oil for blood..
and they both suffer the same braindamage caused by contagious hemotoxic pathogens.
Alternative Energy research in Alaska will end up being a big handout to Beyond Petroleum.
Fisher-Tropsch in Alaska will just be another conglomerate empire while small-biz will always be cannon fodder.
Conglomerates are bigger than most nations, but they don't recognize borders or boundaries, or laws.
......flash/rumble
All of this attention to Energy and how it is produced is very important. I think that if there is going to be money alloted to energy from the govenement it should be used to complete current projects and start new projects. The coal plant in Healy is one project that if finished will help to decrease some of the high electric bills, but it will not be a fix all. Other sources need to be looked especially projects that have been going on already, but construction needs to be started now. One way to produce energy that I do not hear talked about much in Ak is a nuclear power plant. Nuclear energy can not only be used to power all of the electric needs of the interior, but it can also be used to heat at least in the near vasinity of fairbanks, homes and businesses. Although this does not solve the high fuel prices, it will reduce the Aslaksan consuption so that more of the oil produced on the Slope can be sold out of state and bring back more money to the state. A nuclear plant can also help to reduce gasoline consuption by produce hydrogen that can be easily retrofited to use in existing vehicals. A nuclear plant In Faibanks would be a great way to bridge the gap between Renewable energy sources and current fossile fuel sources.
ANWR, Beaufort and Chukchi drilling must be opened as domestic energy production is a national economic, and security imparative now. McCain, you can bury Obama with this. Americans havent gone through a winter with $145 oil yet. New prodcution will send a message to energy traders to counter act all the negative market news and will mitigate prices. Americans have effectively caused our domestic energy crisis by over regulating the oil, gas, nuclear, coal industries. We have the ability to use these proven domestic resources and solve these problems.
Energy futures contracts are actually available to small businesses in Alaska if the local refineries would tie their prices to NYMEX prices. Fairbanks businesses could fix the cost of heating oil fuel for commercial buildings if Petro Star and or Flint Hills will provide contracts to sell their products tied to an index like NYMEX. The state would need to tie its royalty price to NYMEX to allow this seemingly.
Lastly, Alaskans must be held accountable to conserve energy. AHFC's energy program for homes is a great start but requires more funding and it should include businesss property. Small business provides the most jobs in the country and AHFC's program should be expanded to include businesses owned by Alaskans. Commercial buildings in Fairbanks have value quickly the past months. $1 increased heating cost is a $10 reduction in the present value of the income stream generated by income properties based upon a standard 10% income capitalization rate. Many commercial buildings in Fairbanks had heating bills >$25k last year and they will be $50k this year resulting in a $250k reduction in the income value. Fairbanks is facing a 10% real estate value reduction.
thank you.
The State of Alaska's current budget surplus is an indirect tax on Alaskans. The state budget balances at $67 / barrel this year... at $145 the State is collecting >200% of that. The refineries buy the oil at this price and the cost is passed along to Alaskans. Fairbanks, southeast, and bush Alaska are hardest hit. The Anchorage bowl residents (1/2 the state population) on natural gas are paying a fraction of the costs.
6% of jobs in Anchorage are directly related to oil & gas industry and 11% of the household income is directly related to oil and gas. Anchorage is the primary beneficiary of the busiest construction, drilling and maintenance programs on the slope since the completion of the oil pipeline.
Based on the above $1200 per resident does not fix the problem. It's a big screen TV for Anchorage and a partial fix for Fairbanks etc. My house is 2500 SF and I burned 1100 gallons the past 12 mos and that is with propane appliances, 5star energy rating, and only 2 people in the house. Most homes burn more per SF. I'm looking at $5200 to heat my house this year, and paying $160/mos electric. What are you paying Anchorage? Anchorage is talking about heating sidewalks downtown... time is very short, so nothing can be done but cut checks before winter at this point this year, but lawmakers should take a stand recognize these funds are needed for the other 1/2 of the state outside Anchorage.
The State should consider to sell royalty oil below market rates to the refineries in turn for fixed price heating fuel production available to distributors, say at $80 / barrel for this portion of production, and running the refineries in Fairbanks. Alaskans own the royalty oil and there is no reason Alaskans have to pay $145 per barrel for the oil to heat their houses so that lawmakers can deliberate how to spend
Selling royalty oil to local refineries at below market costs will save Alaskans about $250 million in Federal income taxes. The $1200 special dividends will be taxed by Uncle Sam at roughly 25% on average.
Next the Healy coal plant absolutely must be opened and brought online asap. Alaskans don't care who runs it but get a competing electric producer online. Alaska has 300 years of electricity in coal resources for the entire USA...
Simultaneously, make a deal now for a gas line... this must happen in 2008. Lawmakers, you won't be forgiven if you do not.
Well said but you gotta remember most alaskans dont read the news much and will retaliate when they hear a nuclear power plant is being built in their back yard. Alaska would need a ton of convincing if Nuclear Energy was an option. A better solution is to cheaply turn Alaska into a giant solar panel since Alaska gets all this sun. Check this out http://www.nanosolar.com/. Nuclear Energy would be a large political and controversial plaything due to the issues of safety, terrorism and economics.
Is the State or Mr. Whitaker providing solutions for a major energy need, e.g. school transportation and heating for this winter while long term energy plans are discussed, discussed, and maybe implemented?
Perhaps the state could supplement the school district energy costs with the additional oil revenues. Each school district could submit an energy/fuel estimate based on prior year usage to receive additional funding to cover 25%-35% of the cost (depending on how much higher fuel as increased the prior year).
Meanwhile, what will happen to our FNSB property taxes when the Borough pays this winters fuel & electric for schools, volunteer fire services, and winter road maintenance? ( I have no kids in school)
In the US House, Bill Shuster (R-PA) provided legislation June 26 for domestic resource development and renewable energy development, including Alaska.
http://www.house.gov/shuster/content/ene...
There is already a proposed small plant in the works for Galena. The one problem that i find with most renewable energy is that is not good for base line generation because the sun only shines in the summer here, and the wind does not blow at a constant 10mph all the time. The rivers up here are frozzen for amny months of the year limiting flow and power transfer. Reducing this oil Addiction is not going to be easy. It will take work, but So have many other obsticals this state has worked though. It is easy to say pump more oil and mine more coal to fix this energy problem, but it will not solve the proplem.
woodman,
21 billion = 30 thousand per resident. If we build the all Alaska pipeline then we do incur the entire cost in tens of billions. I agree that the danger is big government. 120 million spent to study a dam that won't be built and 300 on a power plant that is mothballed. Now they are proposing to spend the surplus for years into the future to "study" ways to replace oil as our primary fuel source. Not on an actual construction project, but just on a hunch that one of the plans might someday be feesable. Mr Speaker and Mayor Whitaker have you lost your minds along with your sense of good judgement?
If the state had put their dollars wasted on those projects with another 80 million seven years ago, the gas line would be only three years from completion. Now, if they put their money where their mouth is, they could get the gas line started by a company that specializes in building natural gas lines in arctic environments and maybe we will save the state from going bankrupt in twenty years. Building gas lines is what Trans Canada does best and the State still doesn't have a clue how to get it done even when they have spent hundreds of millions of dollars studying it. As for the alternative, there isn't one, Denali, aka BP/Conoco, has never built a gas line in Alaska or anywhere else. Trans Canada has the one thing we lack in Alaska, EXPERIENCE in building a line and making it work.
Soon we will have another election and people will move out of office and leave their messes behind. AGIA is the next mess that had great intentions, but got bogged down by the politicians. In the mean time, we wont move forward with getting our gas to market before the oil supply runs dry and we will end up with a budget deficit rather than a surplus. You want an all Alaska line, and it's a nice idea, but not a practical one, and ten years from now we will be broke, without a gas line, saying we should have spent half a billion instead of tens of billons just so we could sell gas to the world.
I trust our government to do the right thing, we are already putting 250 million into alternative energy research and development. We deserve to see some results from spending that money before we commit another 21 billion dollars.
I just really don't get how you people think that opening ANWR to exploration is going to lower oil prices. There's relatively little oil there, it's cold and generally undesirable.
If ANWR held another elephant, it'd be one thing, but it's a _tiny_ field in comparison to elsewhere. Opening it isn't going to have _ANY_ effect upon a global market. You're still going to pay $5 for gas. Global market? Of 85 million barrels per day. ANWR has 5b/bbl. That's just over 3 months of global infusion support. That's a blip on the screen--the market won't even notice.
What is so hard to understand about that?
Back in the 70's off gull island they hit oil deposit 4 times the size of PB, they capped it ...keep it quite....
*sigh*
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