Legislature(2015 - 2016)BARNES 124

02/17/2015 10:15 AM ENERGY

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Audio Topic
10:17:33 AM Start
10:18:08 AM HJR8
10:35:53 AM HB105
11:47:32 AM Overview: Rural Alaska Fuel Service
12:00:31 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Location Change from Room 17 --
+ Program Overview by Del Conrad, Chief Executive TELECONFERENCED
Officer, Rural Alaska Fuel Service
+= HJR 8 FEDS ALLOW STATE TO MAKE ENERGY CHOICES TELECONFERENCED
Moved CSHJR 8(ENE) Out of Committee
*+ HB 105 AIDEA: BONDS;PROGRAMS;LOANS;LNG PROJECT TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
         HJR  8-FEDS ALLOW STATE TO MAKE ENERGY CHOICES                                                                     
                                                                                                                                
10:18:08 AM                                                                                                                   
                                                                                                                                
CO-CHAIR COLVER announced that the  first order of business would                                                               
be HOUSE  JOINT RESOLUTION NO.  8, Urging the  federal government                                                               
to empower the state to  protect the state's access to affordable                                                               
and reliable electrical generation.                                                                                             
                                                                                                                                
10:18:18 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  TILTON  moved  to adopt  the  proposed  committee                                                               
substitute (CS) for HJR 8,  labeled 29-LS0401\H, Nauman, 2/16/15,                                                               
as the  working draft.  There  being no objection, Version  H was                                                               
before the committee.                                                                                                           
                                                                                                                                
10:19:18 AM                                                                                                                   
                                                                                                                                
JOSHUA BANKS, Staff, Representative  David Talerico, Alaska State                                                               
Legislature,  on behalf  of  Representative Talerico,  summarized                                                               
the changes to HJR 8 in  Version H, beginning with a title change                                                               
to add  a statement urging  the federal government to  exempt the                                                               
state from the Clean  Power Plan (CPP).  On page  1, lines 12 and                                                               
13 were added which read:                                                                                                       
                                                                                                                                
     WHEREAS  the  state has  joined  with  other states  in                                                                    
     asserting that  the Clean Power  Plan is  unlawful and,                                                                    
     in comprehensive comments, has asked to be exempt; and                                                                     
                                                                                                                                
MR. BANKS said on page 2, lines 2 and 3 were added which read:                                                                  
                                                                                                                                
     WHEREAS  the  application of  the  goals  of the  Clean                                                                    
     Power  Plan  to  the   state  is  fundamentally  flawed                                                                    
     because  the goals  rely  on  interconnection with  the                                                                    
     North  American  grid,  to   which  the  state  is  not                                                                    
     connected; and                                                                                                             
                                                                                                                                
MR. BANKS said on page 2, lines 17-22 were added which read:                                                                    
                                                                                                                                
     WHEREAS   renewable   energy  and   energy   efficiency                                                                    
     measures have  been implemented at significant  cost to                                                                    
     the state, but will not  be credited to the carbon goal                                                                    
     of the state; and                                                                                                          
                                                                                                                                
     WHEREAS  the   Clean  Power   Plan  will   require  the                                                                    
     premature retirement  of the  Healy Unit 1  coal plant,                                                                    
     underutilization or  premature retirement of  the Healy                                                                    
      Unit 2 coal plant, and significant new investment in                                                                      
     renewable energy and energy efficiency; and                                                                                
                                                                                                                                
MR. BANKS said  the BE IT RESOLVED language beginning  on page 2,                                                               
line  28, was  changed to  include  exemption for  Alaska to  the                                                               
Clean Power Plan,  and on page 2, line 10,  the original language                                                               
was changed from "a one  and one-half percent cap on electricity"                                                               
to  "minimal electrical."   Finally,  added  to the  distribution                                                               
list were Gina McCarthy, Administrator  of the U.S. Environmental                                                               
Protection   Agency   and    Janet   McCabe,   Acting   Assistant                                                               
Administrator for the Office of Air and Radiation.                                                                              
                                                                                                                                
10:22:40 AM                                                                                                                   
                                                                                                                                
CO-CHAIR COLVER confirmed  that public testimony was  open on HJR
8.                                                                                                                              
                                                                                                                                
10:23:23 AM                                                                                                                   
                                                                                                                                
NORMAN  ROKEBERG, Commissioner,  Regulatory Commission  of Alaska                                                               
(RCA), informed the  committee CPP is a change  to section 111(d)                                                               
of the Clean Air Act.  In  December of last year a taskforce, led                                                               
by the  state administration and  its agencies,  delivered formal                                                               
comments  to  the U.  S.  Environmental  Protection Agency  (EPA)                                                               
requesting  an  exemption  from   CPP  rules  while  concurrently                                                               
supporting  legal  action  to  find said  rules  unlawful.    Mr.                                                               
Rokeberg appreciated  the legislature's  attention to  this issue                                                               
which  holds  the  potential  for impacts  to  ratepayers  and  a                                                               
potential shift of  power reserved for the states  to the federal                                                               
government.   The taskforce  requested an  exemption to  CPP from                                                               
EPA because Alaska  is not connected to the  North American grid,                                                               
there  were  inaccurate  calculations  by  EPA,  there  would  be                                                               
increased cost to Railbelt consumers,  and there was a failure to                                                               
recognize   Alaska's   investment   in   efficiency,   which   is                                                               
approaching $1 billion.  He  advised that CPP rules would require                                                               
Alaska  to  focus on  electrical  efficiency  instead of  thermal                                                               
efficiency, which  is more appropriate  given the climate  of the                                                               
state.  Finally, he opined CPP  would force the closure of one or                                                               
both of the  Healy coal plants.  Mr. Rokeberg  concluded that EPA                                                               
wants "the  people of the North  Star Borough to sit  in a dimly-                                                               
lit  room, a  cold  dimly-lit room,  at  the end  of  a 350  mile                                                               
extension cord."                                                                                                                
                                                                                                                                
10:27:06 AM                                                                                                                   
                                                                                                                                
MR. ROKEBERG  directed attention  to Version H,  page 2,  lines 5                                                               
and 6 which read:                                                                                                               
                                                                                                                                
     WHEREAS the  Regulatory Commission of Alaska  should be                                                                    
     empowered to  make decisions with methodology  based on                                                                    
     the lowest production costs for electrical generation;                                                                     
                                                                                                                                
MR. ROKEBERG  expressed his  belief that  the foregoing  does not                                                               
recognize  the authority  in how  RCA conducts  its business;  in                                                               
fact,  to  ensure the  lowest  production  cost, RCA  would  need                                                               
citing  authority in  generation.   Also, the  language questions                                                               
the use of  economic dispatch, and he noted generation  is not in                                                               
the purview of RCA.  He  urged the committee to consider language                                                               
he had previously suggested in this  regard.  Further, on page 2,                                                               
line 10 states the obvious.  Also on page 2, line 13 read:                                                                      
                                                                                                                                
     WHEREAS  the state  needs  coal-fired  power plants  to                                                                    
     ensure the  reliability of the electrical  energy grid;                                                                    
     and                                                                                                                        
                                                                                                                                
MR. ROKEBERG questioned the veracity  of this statement.  Also on                                                               
page 2, lines 15 and 16 read:                                                                                                   
                                                                                                                                
     WHEREAS  the  loss   of  other  traditional  electrical                                                                    
     generation methods  may cause natural gas  plants to be                                                                    
     overused or  used in ways that  exceed their engineered                                                                    
     design; and                                                                                                                
                                                                                                                                
MR.  ROKEBERG advised  the foregoing  is a  generalized statement                                                               
that  applies to  the generation  capacity  in the  Lower 48;  in                                                               
Alaska,  natural  gas  plants  are  new  and  efficient,  and  he                                                               
suggested deletion.                                                                                                             
                                                                                                                                
REPRESENTATIVE CLAMAN asked whether  Mr. Rokeberg supported HJR 8                                                               
as currently drafted.                                                                                                           
                                                                                                                                
MR. ROKEBERG responded  he would like to see  some changes, which                                                               
could be made in the next committee of referral.                                                                                
                                                                                                                                
[Public testimony was treated as closed.]                                                                                       
                                                                                                                                
REPRESENTATIVE TALERICO stated  his preference to move  HJR 8 out                                                               
of committee.                                                                                                                   
                                                                                                                                
10:32:31 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  TILTON  moved  to  report CSHJR  8,  Version  29-                                                               
LS0401\H,  Nauman,  2/16/15,  out of  committee  with  individual                                                               
recommendations and  no fiscal note.   There being  no objection,                                                               
CSHJR 8(ENE)  was reported  from the  House Special  Committee on                                                               
Energy.                                                                                                                         
                                                                                                                                
[The forthcoming zero fiscal note, Identifier:   HJR 8 HENE FN 1,                                                               
was  reported out  of the  House Special  Committee on  Energy on                                                               
2/19/15.]                                                                                                                       
                                                                                                                                
10:32:50 AM                                                                                                                   
                                                                                                                                
The committee took an at ease from 10:32 a.m. to 10:35 a.m.                                                                     
                                                                                                                                

Document Name Date/Time Subjects
HB 105 - Transmittal Letter.PDF HENE 2/17/2015 10:15:00 AM
HB 105
HB 105 Fiscal Note - L0019-DCCED-AIDEA-02-10-15.PDF HENE 2/17/2015 10:15:00 AM
HB 105
HB 105 ver A.PDF HENE 2/17/2015 10:15:00 AM
HB 105
HJR 8 - Draft Proposed Blank CS ver H.pdf HENE 2/17/2015 10:15:00 AM
HJR 8
HJR 8 - Supporting Document - Observations on 111(d) in Alaska.pdf HENE 2/17/2015 10:15:00 AM
HJR 8
HJR 8 - Supporting Document - Rokeberg Letter 111(d).pdf HENE 2/17/2015 10:15:00 AM
HJR 8
2015-02-17 - HENE - Agenda.pdf HENE 2/17/2015 10:15:00 AM
HJR 8 - Summary of Changes Ver. H.pdf HENE 2/17/2015 10:15:00 AM
HJR 8
HJR 8\
HB 105 Fact Sheet-AIDEA-02-17-15.pdf HENE 2/17/2015 10:15:00 AM
HB 105
HB 105 Sectional Analysis AIDEA 2-17-15.pdf HENE 2/17/2015 10:15:00 AM
HB 105
HJR 8 Fiscal Note - HJR 8 HENE FN 1.pdf HENE 2/17/2015 10:15:00 AM
HJR 8