Renewable energy in Alaska: state's investments generate big returns.

• Author: Resz, Heather A.
• Position: ENERGY

[ILLUSTRATION OMITTED]

Despite Alaska's vast energy resources--renewable and oil and gas--Alaskans pay nearly twice the US average of 9.8 cents per kilowatthour for electricity. Only Hawaiians--at 34 cents per kilowatt-hour--pay higher average costs than Alaska, where some rural communities pay upward of 50 cents per kilowatt-hour, according to the US Energy Information Administration.

When Alaska's energy costs and oil prices peaked about a decade ago, the Legislature passed several bills aimed at reducing energy costs for households and businesses by increasing conservation, energy efficiency, and the use of renewable energy. At the same time, the state also was enjoying record oil profits and had capital to invest in retooling Alaska's far flung energy systems.

Many of these investments will continue paying by generating savings on Alaskan's electrical and heating costs for the next fifty to one hundred years, according to Sean Skaling, programs and evaluation director for Alaska Energy Authority (AEA).

For instance, the Renewable Energy Fund has invested $257 million in resource assessment and the development of renewable energy projects across Alaska since 2008. The result is fifty-four new projects that will save Alaskans an estimated $60 million in electric and heating costs this year alone, according to the "2015 Status Report and Round IX Recommendations" released in late January by the AEA, which manages the fund.

Multiplied over the lives of the projects, that equals billions of dollars in savings for Alaskans in avoided fuel costs.

AEA staff recommended grants for another thirty-nine projects this year, but the Governor's budget only includes $5 million for the program--enough to fund the top seven projects.

Micro-Grid Working Laboratory

Statewide renewable energy makes up 25 percent of the electricity pie. But in some rural Alaska communities, renewable resources supply 100 percent of electricity, Skaling says.

"Alaska communities are seeing big economic benefits from integrating renewable energy with existing diesel systems," he says.

He highlighted the success of Kodiak Electric Association, which uses a one-ofa-kind integrated hydro, wind, battery, flywheel system to reduce its diesel use by 99.7 percent.

Alaska has working hands-on knowledge with more than fifty integrated microgrid systems in operation, Skaling says.

"We've learned so much--the state, AEA staff and power-plant operators in rural Alaska, and contractors," he says. "Were getting much better at it."

Working with the community of St. George taught AEA staff more about...