New laws may lead to renewable energy projects in Alaska

June 03, 2010

Lawmakers in Juneau decided unanimously that the state should do more to promote renewable energy projects such as wind, hydro and geothermal. (Jonathan Hartford/KTUU-DT)

by Ted Land
Wednesday, June 2, 2010

ANCHORAGE, Alaska -- Gov. Sean Parnell signed a pair of bills into law Wednesday that might allow companies to break ground on large-scale renewable energy projects in Alaska this summer.

Lawmakers in Juneau decided unanimously that the state should do more to promote renewable energy projects such as wind, hydro and geothermal.

Fire Island, just offshore from Kincaid Park, is the site of a much talked-about wind turbine project. Native corporation CIRI says the project could someday power 18,000 Anchorage homes.

"While there's not a lot of activity on the island going on right now there's a lot of work being done internally in our offices to move this project forward," said Margie Brown, CIRI president and CEO.

The timeline for the Fire Island project is now more solid, because of the bills.

One bill strips away some of the regulation for renewable projects that sell their power to regulated utility companies.

The sponsors of the bill say there's no sense in regulating a project twice.

"We've built up quite a repertoire of statutes and experience in oil and gas. We just don't have it yet for renewable energy," said Sen. Lesil McGuire, of Anchorage.

The second bill reduces the royalty rate for geothermal leases on state land, making it more affordable for companies like Nevada-based Ormat Technologies, which is looking to develop part of Mount Spurr.

"The royalty rate that was originally proposed for geothermal development was quite staggering," said Paul Thomsen, of Ormat Technologies.

Ormat Technologies says these new laws will put geologists to work in Alaska this summer.

"We know the heat is there. Two more variabilities that we know we're going to explore is the permeability and the water," said Thomsen.

Ormat is still exploring. It has not guaranteed that the Mount Spurr leases will yield a viable energy source.

CIRI needs a commitment from local power companies that they'll use the wind-generated power before moving forward with the Fire Island project.

Contact Ted Land at tland@ktuu.com.

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