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My Turn: Alaska can't afford two mega-energy projects

Posted: April 7, 2014 - 11:00pm

As a log builder in rural Alaska, my income can go up and down, sometimes dramatically, from year to year. So I can identify with the number one problem facing state lawmakers: How to pay the bills for things we Alaskans have come to rely on, like quality health care, education and retirement, with less and less cash coming in the door. Dwindling oil production and revenues are forcing some difficult decisions in Juneau this year and likely for years to come.

One choice faced by legislators, however, shouldn’t be very difficult. Alaska can’t afford to pursue two mega-energy projects. The proposed Susitna-Watana Dam is deeply flawed, unnecessary and hugely expensive. Estimates of its costs range from $5 billion to $8 billion when associated infrastructure, like transmission line upgrades and inevitable cost overruns, are taken into account.

Yet Gov. Sean Parnell continues to push for the dam even as he pursues the proposed Alaska Gas Pipeline, which also carries a multi-billion dollar price tag. The pipeline at least makes sense for Alaska. Alaskans need help reducing heating costs. Natural gas is a relatively clean and reliable way to heat a home and can also be used to generate electricity. Simply put, the gas line can provide the energy Alaskans really need while a dam cannot. In fact, an official from the Alaska Energy Authority, the government body backing the project, said at a 2011 legislative hearing, “If you have a dam, you will still need the gas regardless.”

The Susitna dam would also fail to meet the needs of rural Alaskans who face energy costs that can reach upwards of half their disposable income, according to Sen. Lyman Hoffman, D-Bethel. As part of legislation to develop the pipeline, Sen. Hoffman recently proposed a new special energy fund that would bring cheaper energy to rural Alaska and other parts of the state that wouldn’t have direct access to gas from the pipeline.

Public dollars would also be well spent on smaller energy projects, including wind, geothermal, tidal and other renewable projects. Many could be located in rural areas where our energy crisis is most acutely experienced and the economic boost is most needed. Twenty-one percent of Alaska’s electricity already comes from 24 smaller-scale hydro projects, which meet the true standard of “renewable” because they don’t harm other renewable resources, like salmon and fishing jobs.

Negative impacts from the dam go well beyond harming one of the state’s most important salmon rivers. I am one of the Alaskan residents who also cares about the irreversible impact the dam would have on caribou and moose hunting in unit 13, local commercial and recreational fishing, river travel in summer and winter, tourism and a way of life for my family and hundreds of other families who live in the Susitna Valley.

We’ve already spent more than $170 million on studies over the last two years. AEA says they need another $110 million to continue the studies. The track record isn’t promising as we look at pumping tens of millions of dollars of more public money in the years to come on scientific evaluation needed to complete the licensing process. As a carpenter, I look at this situation and wonder who messed up the estimate? And who is getting rich on all these cost overruns?

Alaska is facing tighter times this year. The director of the Legislative Finance Report recently told legislators, “We are spending about $7 billion and our revenue is only $5 billion.” House Finance Committee co-chair Alan Austerman has also done the math. Early in this year’s session he told the Associated Press, “state legislators this year should take a hard look at projects, like the proposed Susitna-Watana dam, and decide if they are the best places for continued investment.”

I hope legislators take that hard look at our situation and find the choice is clear. Let’s stop throwing good money after bad. The Susitna dam is flawed and unnecessary. Put an end to its funding now and we can trim the budget and move Alaska off a dangerous fiscal path that will drag us further into the red far into the future.

• Mike Wood is a carpenter and log builder from Chase.

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Art Petersen
3635
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Art Petersen 04/08/14 - 07:59 am
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Mr. Wood's analysis

is easy to agree with. These are lean times, made so by that vampire standing in the shadows, SB 21, "the give away" of $2 billion to the oil companies with more to follow, much more.

But back to the point at hand, it just makes sense to focus on one big project at a time, and that would be the gasline. Rural Alaska residents need this energy desperately. Further, right now there is a brand new need for LNG on the world market. Europe needs this energy with Russia playing politics with the supply and the only US export location close to Europe selling to Asia. Alaska could participate in that market.

Best would be to shelve the damn project and put the $110,000,000 in planning toward the gas resource. Education could use the money more, but even more than education, people ought not to be made poor just to keep warm.

Bill Burk
12926
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Bill Burk 04/08/14 - 08:51 am
4
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The Dam

Again Parnell is leaning tower big business instead of tying to improve the the state and its people!

John McDowell
998
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John McDowell 04/08/14 - 01:26 pm
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..along these same lines...

"....These are lean times, made so by that vampire standing in the shadows, SB 21, "the give away" of $2 billion to the oil companies with more to follow, much more." You got that right. http://www.alaskadispatch.com/article/20140407/alaskas-capital-megaproje...

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