Today's price for the fuel we use to generate electricity is the same as it was in 1893" was the opening comment by Tim McLeod, President of Alaska Electric Light & Power Company in his presentation at the Southeast Conference Annual Meeting in Sitka last month. Think about that. Over 100 years and not a price increase. What McLeod was referring to, of course, is the fact that the cost of water his company uses to generate electricity in their hydroelectric facilities is free.
In Southeast Alaska, we are blessed with abundant rainfall that keeps lakes and streams full and flowing. Over 100 years ago, the city founders in Juneau realized this potential and developed hydro facilities to supply its residents with renewable power. These projects are still operating. The capital cost to develop these projects was repaid decades ago. Not only is the power generated from these facilities now inexpensive, but perhaps more importantly, it is clean and renewable.
And Juneau is not alone. Ketchikan, Sitka, Wrangell, Petersburg, Craig and other communities on Prince of Wales Island, Haines, Skagway, Pelican and other towns in Southeast all take advantage of our region's abundant rainfall and generate some, if not all, of their electricity using hydroelectric facilities.
Unfortunately, there are still communities in Southeast Alaska, such as Kake, Hoonah, Angoon, as well as Gustavus, that are still totally dependent on diesel generation and have some of the highest electricity rates in Alaska. Their fuel is not free. The price of crude has recently jumped above $50 per barrel, and electric bills in those communities are going up.
Southeast Conference, working with the region's utilities, Native organizations and communities, developed a plan to interconnect as many of these communities as possible. Interconnections to Hoonah from Juneau and to Kake from Petersburg are in varying stages of development. Both intertie segments will utilize hydroelectric power to displace diesel generation in those communities. Kootznoowoo, Inc., the village corporation in Angoon, is beginning the permitting process to develop the Thayer Creek hydro project on Admiralty Island, near Angoon. This project will displace existing diesel generation and, although the project is within Kootznoowoo Wilderness on Admiralty Island, this use was specifically authorized by Congress in 1980 with the passage of the Alaska National Interest Lands Conservation Act.
With respect to Gustavus, Southeast Conference evaluated the feasibility of running an interconnection from Hoonah to that community and the economics of this line simply didn't pencil out. The options for power generation in Gustavus are limited. There simply are no viable alternatives except for continuing diesel generation with its incumbent pollution problems and developing a "run of the river" hydro project on Falls Creek. Unfortunately, when the Glacier Bay National Park boundaries were drawn, the location for the Falls Creek hydro facility was included within the park. However, in 1998, Congress passed legislation enabling the Falls Creek area to be transferred out of the park and into State ownership. So there would be a "no net loss" of park lands, state land would be added to the Wrangell-St. Elias National Park. This legislation and land trade even had the blessing of Secretary of the Interior Bruce Babbitt under President Bill Clinton.
Hydroelectric projects are where they are. They can't be picked up and moved. Congress made the right decision when it allowed this project to be built, providing certain conditions are met. They weighed the advantages of a clean, renewable generating source of power on Falls Creek against the disadvantages of existing diesel generation and associated air and noise pollution and potential for fuel spills near the boundary of the Glacier Bay National Park.
Our vision for Southeast Alaska should be to reduce, to the maximum extent possible, the use of diesel as a primary fuel source for the generation of electricity. We can accomplish this by utilizing the region's hydroelectric potential along with the development of an interconnected transmission system. Unfortunately, the transmission line to Gustavus doesn't make economic sense. The Falls Creek hydro project does. Let's not condemn the residents of Gustavus to a future of upwardly spiraling electricity costs caused by diesel generation. Gustavus and the National Park headquarters located there should be powered by clean, renewable hydropower, not diesel generation. Gustavus supports the project, the local electric utility supports the project and Congress enacted the land trade so this project could proceed. The Juneau Empire was wrong in its opinion that the Falls Creek hydroelectric facility should not be built. We should all get behind this project and urge its completion.
Dave Carlson is intertie coordinator for the Southeast Conference. He lives in Petersburg.