Alaska Gov. Mike Dunleavy calls for 80% of Railbelt power to be renewable by 2040

JUNEAU — Alaska Gov. Mike Dunleavy has introduced new legislation that would require 80% of the Railbelt’s electricity to come from renewable sources by 2040, with penalties for electric companies that fail to meet the requirement.

An analysis ordered by the governor and published by the National Renewable Energy Laboratory in December says meeting the goal would require millions of dollars of investment in hydroelectric, solar, wind, tidal and geothermal power, as well as transmission lines and batteries. Reaching the 80% standard could save $500 million per year in fuel costs, the report said.

The governor’s plan calls for a gradual implementation: Utilities would be required to generate 20% of their power from renewable sources by by December 31, 2025, 55% by the end of 2035, and 80% by the end of 2040.

In the governor’s state of the state address last month, he said he envisions “an Alaska that is energy independent and a leader in renewable energy, whether it be hydro, tidal, geothermal, wind, solar, or other.”

“We have abundant renewable resource potential, and we can turn that potential into a reality that will lower costs for all Alaskans, and invite industries to invest in our great state as well,” he said at the time.

Chris Rose is the executive director of the Renewable Energy Alaska Project, a nonprofit that worked for months to draft a plan that formed the basis for the governor’s legislation.

Electricity prices in the Railbelt are about 50% higher than they are in the Lower 48, in large part because of the cost of Cook Inlet natural gas, he said, and that makes it difficult to attract business investment.

Jenny-Marie Stryker is the political director of the Alaska Center, a nonprofit that regularly criticizes the governor for inaction on environmental and social issues, but Dunleavy’s new legislation is undeniably good, she said.

“I think it’s achievable. I think it’s necessary. And I totally think it’s realistic,” she said.

It’s an election year, and Dunleavy is campaigning for reelection, but Stryker said she doesn’t think Dunleavy introduced the bill simply to win votes.

“I think that the governor is serious about this. We see this introduced in good faith, we’re taking it in good faith,” she said.

The law would be stronger than legislation passed under the administration of former Gov. Sarah Palin that set an unenforced goal of 50% renewable power statewide by 2025. The state is almost certain to miss that goal.

Under existing law, the Railbelt utilities are required to work together in an organization that sets standards for reliability and long-term planning.

If passed by the House, Senate and signed into law, the governor’s legislation would put that organization in charge of implementing the new standard, with fines for utilities that fail to comply. The state’s utility regulator would be allowed to waive the fines in case of extenuating circumstances, like a disaster.

The National Renewable Energy Laboratory suggested five ways that Alaska could meet the 80% standard by 2040:

• The state could build the vast Susitna-Watana hydroelectric project and bring the Bradley Lake hydroelectric dam to full capacity;

• It could expand Bradley Lake, build dams at Grant Lake near Moose Pass and Snow River north of Seward, then add some wind and solar power;

• It could expand Bradley Lake but add additional wind and solar;

• It could use geothermal power and tidal power, as well as wind, solar and a Bradley Lake expansion;

• Or it could do a smaller Bradley Lake expansion with bigger investments in geothermal, tidal, wind and solar power.

All five scenarios also require the installation of battery banks to balance the ebb and flow of wind power, upgrades to the electrical intertie between Fairbanks and Anchorage, and a small new hydroelectric plant somewhere in Southcentral Alaska.

The report doesn’t suggest where the initial funding for these projects would come from, but it does say that building them would save hundreds of millions of dollars in fuel costs.

Stryker said she’s hopeful that the legislation doesn’t encounter significant opposition and that it has the potential to create large numbers of high-paying, unionized jobs.

Rose agreed, saying that it would also encourage independent power-plant operators to come to Alaska and build projects, because they know there will be a market for their power. He thinks existing utilities may have the most concerns.

“I think several of the utilities were not interested in seeing this introduced in the first place and were interested in watering down the proposal,” he said.

A Chugach Electric spokesperson said she was unable to provide comment on the governor’s proposal but provided a copy of a letter signed by its CEO and the leaders of four other Railbelt electrical cooperatives.

The letter, written before the governor’s legislation was introduced, didn’t reference the 80% target but said the companies are “aligned in our support around the concept of a sensible and carefully constructed renewable or carbon reduction standard for the Railbelt system.”

Rep. Calvin Schrage, I-Anchorage, is the chair of the House Energy Committee, which is slated to hear the governor’s proposal.

“I think the question is going to be, can the governor move this forward and be able to maintain support from both the utilities and other stakeholder groups? Because this is going to affect a lot of people. So some concerns there, but I’m really excited about it,” he said.

Correction: Jenny-Marie Stryker is the political director of the Alaska Center, not its director. A previous version of this article listed the incorrect title.