Wagoner calls for energy credit

High cost of oil, electricity on agenda for '08

Posted: Thursday, December 27, 2007

Sen. Tom Wagoner says Alaskans need an energy credit program triggered by high oil prices that would help ease the pain of home electricity bills.

The Republican from Kenai said Wednesday he is putting together legislation to at least get a discussion started about ways to cut the energy costs of residential users.

Wagoner said he would propose that the energy credit be triggered whenever the price of a barrel of oil stays above $60 over the course of a year.

"If there is a 12-month period where oil is at $60 or better, it would give every person in Alaska who has paid for electricity distributed through a meter system a $750 credit."

Thus, every household paying for metered electricity would be eligible, he said. The money would go directly from the state to the utilities. Wagoner said he thinks that could be done outside any talk about rural power cost equalization. Many details still need to be fleshed out, but the idea is worth talking about, he said.

Another piece of legislation Wagoner said he was developing would be aimed at encouraging exploration for and development of smaller pools of North Slope oil by ensuring companies taking the risk would have access to facilities for treating the oil, and not have to build their own. Wagoner believes there is enough capacity in existing facilities to accommodate smaller companies.

"It is up to the state to assure they will have affordable facilities to access, even if it comes down to those facilities being expanded," he said.

The state, he said, would not pay that cost, but would ensure access. Space within existing facilities might be freed-up by allowing producers to shut in marginal wells, he said.

"There is a lot of work to be done on this idea," Wagoner said, adding that he doesn't expect a bill to pass this year.

Looking ahead to the second session of the 25th Legislature, Wagoner said he does not expect the bipartisan coalition (of which he is not a member) to dissolve.

"Too may people willing to sacrifice their political philosophies for short-term gains," he said. "I'm not sure just what those gains are; maybe committee chairmanships."

Regarding the recent special session and adoption of the Alaska Clear and Equitable Share bill, Wagoner said he is mostly satisfied with the measure that replaced the Petroleum Production Tax. He said he thought the progressivity elements provisions that kick in higher tax rates when oil prices are high went too far, but he can live with that.

He said he thought that a provision making the ACES law retroactive by six months was egregious, however.

"When you come up and vote in a tax regime, like we did, that should be in place until it's changed," he said. "It shouldn't be made retroactive. If we did a bad job in the first place, then shame on us."

Just because oil companies are making extraordinary profits isn't a reason to make the new law retroactive, he said.

"It's a philosophical thing," he said.

As to the new session itself, Wagoner thinks the Legislature's work can be completed in 90 days, if there is good leadership.

"I'm not sure they have it," he said. "It can be done if they are committed, but I have my doubts."

One good thing about a 90-day session is that if it works and education funding is established early, school districts won't have to hand out pink slips late in the school year and then scramble to fill open spots over the summer as they've often had to do in the past.

Wagoner wasn't sanguine about Gov. Sarah Palin's proposal to spend $1 billion a year on education. He said it didn't really amount to forward funding, and that the funds she's proposed would be vulnerable that is, the Legislature could opt to appropriate them elsewhere.

Beyond that, he said, while he is very supportive of education, there are other vital priorities, including highway infrastructure needs and public safety that should not be overlooked.

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

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