Alternative energy projects abound in Alaska: remoteness and high existing costs give extra incentive to new technologies.

• Author: Liles, Patricia

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While many Alaska businesses are looking for ways to manage expenses by cutting their power consumption, Chena Hot Springs Resort is adding new electrical appliances to guest facilities, increasing the amount of light-filled greenhouses and has even started using excess electric power to make hydrogen.

That's because the resort, located about 60 miles east of Fairbanks in Interior Alaska, has been generating its own electric power using the hot water resource that, for years has offered a therapeutic and relaxing enticement to the remote location.

With the help of federal and state grant funding, Chena Hot Springs installed the first of two 200 kilowatt geothermal-fired generators in mid-2006. The first unit produced electricity for about four months before the second unit was added in mid-December, according to Gwen Holdmann, vice president of new development at Chena Hot Springs Resort.

Successfully breaking new ground in its first year of operation, the geothermal power generation project at Chena Hot Springs is proving out new technology, as the resort's hot water is cooler than what has historically been tapped for power generation.

While the opportunity to prove the viability of an alternative energy project played a factor in taking on the project, the prime motivation to convert Chena Hot Springs Resort to geothermal power is financial.

"We showed on our financial statements that we saved $75,000 in 2006," Holdmann said. "We figure we will save about $500,000 this year (2007)."

Although the alternative energy source may be unique at Chena Hot Springs, the financial and logistical situation that makes alternative energy is not.

HIGH POWER COSTS HELP MAKE ALASKA 'TEST BED'

Alaska offers numerous opportunities to test alternative energy power generation projects, due to the comparatively high price of electricity in the state, according to Brent Sheets, regional manager of the Arctic Energy Office of the National Energy Technology Lab, part of the U.S. Department of Energy.

"New technologies deployed in the Lower 48 have to compete against relatively lower priced electricity generated from large-scale systems that are designed to take advantage of scale of economies," said Sheets. "So while a new technology in the Lower 48 might not be competitive there based on price, it might be economically attractive for early deployment in Alaska, provided the new technology is robust enough to survive the climate here."

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