Homer Alaska - Business

A state Senate committee completed work March 9 on a bill making comprehensive changes in state energy programs.

Senate Bill 220, the Alaska Sustainable Energy Act, was voted out of committee and sent to the Senate Finance Committee, its last stop for consideration before passage by the Senate.

Similar legislation is pending in the state House.

Sponsors are Sens. Lesil McGuire, R-Anchorage, and Bill Wielechowski, D-Anchorage. The senators are co-chairs of the Resources Committee.

Near term solutions include:

* Energy efficiency revolving loan fund: This bill creates a revolving loan program to fund energy efficiency improvements in public buildings. School districts, municipalities and state government will have access to the funds needed to upgrade facilities.

It authorizes the Alaska Housing Finance Corp. to issue $250 million in bonds to capitalize the new loan fund.

"Based on what we have seen from the state's weatherization and home energy rebate programs, this fund will foster 1,500 to 2,000 jobs in the construction industry in Alaska," Wielechowski said.

* Help for families when fuel prices soar: SB 220 links benefits from the state's heating assistance program to the price of oil, providing additional assistance to low-income families when fuel prices are high. The program is also a supplement to the federal low-income heating assistance program.

* Retrofit for state buildings: The state currently spends roughly $55 million per year on heating and lighting its buildings. Energy efficiency improvements can save 20 percent in energy costs, a savings of more than $10 million a year.

The bill would require the state Department of Transportation and Public Facilities to determine which buildings to fix first and to construct any new buildings to high efficiency standards. It also mandates that renewable energy systems be considered when constructing new public works projects.

* Energy policy for Alaska: An energy policy for Alaska would include a goal — but not a law — to increase energy efficiency by 15 percent and generate 50 percent of the state's electricity using renewable energy sources by 2020.

* Statewide fuel cooperative: The Alaska Energy Authority would be required to work with interested communities to establish a fuel cooperative to facilitate bulk purchases, thus lowering costs.

* Coordinate and consolidate state energy programs: The governor would be asked to evaluate how best to coordinate the state's energy departments and programs to avoid duplication. A coordination plan would be sent to the Legislature by November.

* Purchase energy efficient vehicles and equipment: The state would have to consider long-term energy costs when purchasing vehicles and equipment. The bill would require the state to study the feasibility of using compressed natural gas to power vehicles.

* Public education campaign: SB 220 tasks the Alaska Energy Authority and the Alaska Housing Finance Corp. with educating Alaskans about low-cost ways to cut energy consumption and costs.

The bill also directs the AHFC to provide technical assistance to municipalities interested in adopting local energy codes.

Mid-term solutions include:

* Renewable energy tax credit: SB 220 would provide a refundable tax credit to investors to encourage private investment in Alaska's renewable energy sector.

* Loans to businesses for energy conservation improvements: Alaska already provides loans to households for energy improvements, and this bill would include loans of up to $50,000 for businesses to enable investments in energy efficiency. This would primarily help small businesses get access to capital they need to make energy efficiency investments.

* Nuclear energy: SB 220 would allow nuclear energy projects to be considered in Alaska. It also enables proponents of small-scale nuclear energy projects to apply for funding from the state's power project fund.

* Southeast energy fund: The bill would expand the purposes for which this fund may be used, providing a mechanism for constructing generation and transmission projects in Southeast Alaska.

Long-term solution:

* Emerging energy technology fund: SB 220 would create a fund to provide grants for testing energy technologies in Alaska.