Alaskans are no stranger to the dangers of falling oil revenue or the increasing impacts of climate change, which are projected to cost the state $5.5 billion. Now is the time to proactively launch Alaska’s energy future which is precisely what Gov. Dunleavy seeks to do through an Energy Independence Program & Fund that would provide low-interest financing for energy efficiency projects and renewable power generation.
Sustainable Alaska energy independence is a goal I know everyone can get behind. Commonly considered range of approaches include reconfiguring the energy grid, energy efficiency upgrades like heat pumps, and supporting distributed wind, solar and micro-hydro generation are examples of the many projects that are poised to multiply across Alaska. Some of the less talked about, and most promising, approaches this fund could catalyze aren’t even on the table yet. For example, innovative finance mechanisms like the Climate Response Fund that Nikoosh Carlo has proposed that creates a “collaborative governance structure to finance innovative, equitable, community-led climate mitigation and adaptation projects.” The governor’s proposal provides a key opportunity for Alaskans to build a resilient economy and invest in the future our state needs, but it needs to reflect important input from community experts and the Legislature.
Establishing Alaska’s Green Bank positions Alaska to leverage our $130 million share of the $100 billion of federal funds proposed in a bipartisan bill that Rep. Don Young is co-sponsoring. In turn, that is projected to leverage $500 billion from the private sector and create four million jobs over the next four years. That’s 5,000 new jobs for Alaskans who can put that money to work perhaps better than any other place, due to our high energy costs, especially in rural Alaska.
The proposed energy fund would ensure that everyday Alaskans can afford to invest in themselves by providing the upfront capital for projects that can ultimately pay for themselves. If done well, the proposed program would make Alaska a driver of clean energy innovation instead of getting left behind by the energy transition.
The United States installed more wind turbine capacity in 2020 than in any other year and while the Biden administration re-enters the United States into the Paris Climate Accord, Texas and Florida have installed small-scale solar in massive quantities. There’s a rapidly closing window of opportunity to get ahead of the curve and realize the increasing profits from renewables and energy efficiency before large banks and wall street dominate.
Alaska once leveraged other states’ energy economies to ramp up our oil production. It’s time to shift our sights to renewables now that Alaska has fallen from a leading oil economy to producing less oil than Oklahoma or Colorado. The affordable financing proposed would provide a vital investment in Alaska’s energy security and prosperity.
The proposed Energy Independence Program & Fund can be a powerful economic engine to diversify Alaska’s economy and advance sustainable energy development. Housing the fund at AIDEA (the Alaska Industrial Development and Export Authority) makes sense on the one hand, because they are set up to provide this type of financing already, but is dubious given their shady track record of unsound deals and broad public distrust. Many of us are concerned the legislation will fail to meet the stated intents as it’s currently written; updating outdated statutes is key.
In order to succeed, the primary purpose of any project funded must be to reduce greenhouse gas emissions and/or increase energy efficiency. Structural elements to ensure equity, like allocating 35% of lending to rural Alaskans and providing technical assistance to support community access, are vital. The fund must be accountable to a transparent public process and state and tribal experts must inform decision-making throughout. Finally, expenditures from this fund that exceed certain thresholds should be subject to legislative oversight.
Margi Dashevsky is lifelong Alaskan and the regenerative economies coordinator for the Fairbanks Climate Action Coalition.