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Vol. 12, No. 49 Week of December 09, 2007
Providing coverage of Alaska and northern Canada's oil and gas industry

Momentum builds behind energy report

Anchorage Chamber findings, recommendations could spur critical public policy changes across Alaska as briefings continue

Rose Ragsdale

For Petroleum News

A report on energy-related problems facing Alaska, released two weeks ago, has ignited little more than positive comments so far, but its authors hope the report calling for changes will light a fire under government leaders to secure the state’s energy future.

Early indications from the Tri-Borough Commission of Southcentral Alaska, the Palin Administration and the Alaska State Chamber of Commerce also suggest they may get their wish.

The Anchorage Chamber of Commerce published the report, “Hope is not a Strategy: Findings and Conclusions about Alaska’s Energy Crisis,” Nov. 19, after a special 12-member volunteer task force studied the problems and drafted recommendations for possible solutions.

Things have been pretty quiet since, according to Joe Griffith, co-chairman of the Chamber task force and former head of Chugach Electric Association in Anchorage. “After a few early comments, there’s been a strange silence,” Griffith said.

“I’ve heard some positive comments,” said energy consultant Tony Izzo, who also co-chaired the task force and formerly ran Enstar Natural Gas Co.

Presentation Dec. 10

Griffith and Izzo are scheduled to present the energy report at a chamber luncheon forum in Anchorage Dec. 10.

“We’ve offered to brief other groups statewide, and we’ve gotten some takers but not many in government,” Griffith said.

When Chamber members learned that after-tax natural gas costs in Southcentral Alaska jumped 126 percent since 2004, they decided to study the issue from a business perspective, Izzo said.

“That’s a $166 million impact on the economy, and it doesn’t include the cost of electricity!” he said. “We wanted to identify things that would help us get to a long-term solution.”

Griffith said Alaska is “like a Third World Country” when it comes to energy consumption.

The state’s rural communities face serious energy related problems and have no easy solutions. Moreover, high energy costs are forcing rural residents to flee the Bush in favor of Alaska’s urban areas, he said.

The most positive response from government leaders, so far, has come from the Tri-Borough Commission headed by Anchorage Mayor Mark Begich and the mayors of the Kenai and Mat-Su boroughs.

The commission formed an energy policy task force which Izzo and Griffith have been asked to join. It aims to develop a rough outline of a regional energy policy by January, Izzo said.

The Alaska State Chamber of Commerce, meanwhile, has adopted the Anchorage Chamber’s resolution calling for a state energy policy as one of its top three legislative priorities for 2008.

Shively likes statewide perspective

John Shively, former vice chairman of the state chamber and president of the Resource Development Council of Alaska, said he supported the state chamber’s action and will support the energy resolution again when the RDC board takes up the question Dec. 12.

Shively said the report impressed him because it offers a very good statewide perspective.

“I’ve always thought it interesting that Alaska economy is fueled by energy, but it has people in the rural areas that pay the highest energy costs of anywhere, by far,” he said.

Shively said power cost equalization is an attempt to address disparities but it doesn’t touch the high costs of fuel for heating, snow machines and boats, all critical for life in Bush Alaska.

Part of the problem, he said, is that Alaska’s rural residents who are most affected by rising energy costs don’t have ready access to government to demand changes. Instead, he suspects they attempt to cope by consolidating households in both rural and urban areas, he said.

The energy report also may have impressed the governor.

“Gov. Palin has tasked several of her commissioners (for the departments of Natural Resources; Environmental Conservation; and Commerce, Community and Economic Development) to develop a long-term energy plan. She is also planning to hire an energy coordinator,” a spokeswoman said Nov. 30.

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