Mayors call for state energy policy

Posted: Tuesday, March 04, 2008

Shrinking energy supplies and rising costs will impair the future economic health of Southcentral Alaska unless the state takes steps to adopt a comprehensive energy policy, Tri-Borough Commission leaders said at a press conference Friday in Anchorage.

Tri-Borough Mayors John Williams of the Kenai Peninsula Borough, Anchorage Mayor Mark Begich and Matanuska-Susitna Borough Mayor Curt Menard urged the state to act and develop a policy that would ensure plentiful supplies of energy for the Southcentral region, home to more than 60 percent of the state's population.

"If we do not move forward (with an energy policy), we will have severe shortages by 2015," Williams said. "Fifteen or 20 years out, we will surely be in deep trouble."

According to a report from a task force established by the commission last fall, regional and global forces have begun affecting energy supply and demand in Alaska. Rising costs, security and reliability concerns, the influence of market forces, global competition and a growing awareness of environmental impacts demand a comprehensive approach to energy, the mayor's said.

Despite its resource wealth, Alaska currently is a net importer of key energy resources, including jet fuel, distillate fuel, propane and crude oil. Major energy projects are being proposed in the absence of a statewide energy policy. The Railbelt infrastructure for generating electricity is in need of significant new investment. Electricity and natural gas markets in Alaska are isolated, and state regulatory policy is in need of updating, the mayors said.

The commission said the state must adopt a comprehensive energy policy and set strategic goals that would lead to an "adequate, reliable, affordable and sustainable supply of energy."

That policy should promote development of natural gas, coal, oil, gas hydrates, heavy oil and nuclear power, as well as renewable resources such as tidal, wave, hydropower, geothermal, solar, wind and biomass, the mayors said.

They urged the state to review regulations and change statutes as necessary to ensure compliance with a new policy and called for reform of the state's utility regulatory processes.

Among the report's strategic goals was a call to promote additional Cook Inlet natural gas and crude oil drilling and infrastructure improvements. Cook Inlet gas provides the bulk of the Railbelt region's energy needs, the report said. Additionally, there are "significant potential crude oil reserves" yet to be developed in the Cook Inlet region that could supply energy demands for years to come.

Also needed, said the report, is a strategy for storing gas, better planning by Railbelt utilities and efficiency measures that would lead to a 10-percent per-capita reduction in electricity consumption by 2020 and a 10-percent reduction in natural gas usage by 2015.

The state should promote an economically viable program for sequestering industrial carbon dioxide emissions underground and encourage the use of the greenhouse gas in Enhanced Oil Recovery (EOR) projects to produce an estimated 300 million barrels of oil in 13 aging fields in the region.

In an interview Monday, Williams said he would like to see the state develop a 50-year timeline for implementing changes in the way the state uses its energy resources. That would involve establishing a baseline this year that noted current percentages of energy supplied by oil, gas, coal, wind, tidal, geothermal and the like, and setting goals for a different, more efficient distribution by 2058, with specific break points along the way, he said.

The Tri-Borough Commission's report has been forwarded to Gov. Sarah Palin and the Legislature, "with the hopes they will do something about it," Williams said.

Hal Spence can be reached at hspence@ptialaska.net.

Clarion reporter Phil Hermanek contributed to this story.



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