JUNEAU — The Alaska Senate unanimously passed legislation backing the Fairbanks natural gas trucking project.
The passage of Senate Bill 23 on Wednesday would allow the state to pursue a $355 million funding package for a private partnership to bring North Slope natural gas and propane to Interior and rural Alaska.
The project has enjoyed the backing of Gov. Sean Parnell, Interior leaders, and lawmakers from both the Interior and other areas of the state.
“It’s very important that we provide a solution not just for Fairbanks, not just North Pole, but how we can bring energy to other areas of the state,” said Sen. Pete Kelly, R-Fairbanks.
Fairbanks’ other senators, John Coghill, Click Bishop and Lyman Hoffman, rose in support of the plan, citing energy prices and air quality in urging the support of their colleagues.
The bill passed with the “yes” vote of all 20 members of the Senate but not without some caveats.
Sen. Hollis French, D-Anchorage, offered a cautionary note that it’s a big investment from the state and the state hasn’t always been good at picking winning bets.
“What anyone with any memory in this state knows is that we’ve invested in losing investments,” he said. “I’m going to vote for it, but I see some hesitation.”
Others have raised concerns about the narrow scope and relatively high cost of the project and recalled other energy projects that fell well short of their goals, such as the Healy Clean Coal Project.
The bill authorizes the Alaska Industrial Development and Export Authority to provide a financing package of mostly loans to help build a processing facility on the North Slope and a distribution system in Fairbanks. The bill only has $50 million in direct grants, with the remainder being paid back to the state throughout the life of the project.
The package was authored by Gov. Sean Parnell in an effort to settle competing efforts in Fairbanks. Parnell also chimed in to commend the bill’s passage.
“I appreciate the Senate’s work to jumpstart this project and provide energy relief for Alaskans by developing Alaska’s gas,” he stated in an email. “Our focus continues to be on providing the lowest cost of energy to as many Alaskans as possible.”
The bill now moves to the House, where a version of the bill hasn’t budged from committee in the first 59 days of the 90-day session.
After the floor session, Kelly said he was pleased to see the bill, which has been the top priority for the Interior delegation, move ahead.
He also tried to put to rest concerns that Senate Bill 23 or House Bill 74 could conflict with the state’s efforts to build a natural gas pipeline, which is being backed by House Bill 4.
“The Interior delegation essentially supports House Bill 4,” he said. “There’s no reason to be slowing the LNG bill down because something might be going on with the pipeline bill. They’re complementary. ... You’re creating a market (with trucking) because you’re putting a distribution system in, and when the pipeline comes, you’ll have an immediate customer base for that gas.”
He said he believes the Senate’s passage of the bill and strong continued support from Interior lawmakers will help the bill break through in the House.
Contact staff writer Matt Buxton at 459-7544 and follow him on Twitter: @FDNMpolitics.