Work wrapping on Susitna-Watana project

Alaska Gov. Bill Walker said when announcing budget cuts June 29 that he was shutting down two megaprojects - the Susitna-Watana hydroelectric project and the Knik Arm crossing.

The Alaska Energy Authority has been working the proposed Susitna-Watana dam.

Walker put a hold on work on a number of large projects after taking office at the end of 2014, among them Susitna-Watana, citing a large budget deficit caused by “the extensive drop in market oil prices” in a Dec. 26, 2014, administrative order. State agencies were directed “to halt to the maximum extent possible discretionary expenditures” for the projects.

In July 2015 the Walker administration lifted the freeze, authorizing the use of the remaining $6.6 million of original $192 million in state funds authorized for Susitna-Watana.

AEA then proposed a new schedule for preparing a FERC license to the Federal Energy Regulatory Commission, telling the commission the original schedule for the application had been disrupted by issues related to state funding for the project.

AEA told FERC it planned to use the remaining project funds to complete and file reports on studies conducted in 2014 and resume public meetings on the reports. The change in schedule was expected to delay completion of the FERC application by two years, from 2019 to 2021.

When Walker announced the shutdown of Susitna-Watana and the Knik Arm crossing he said they could not continue to advance in the current fiscal situation but said closing down the projects would be done in such a way to preserve work done to date.

AEA told Petroleum News in a July 8 email that the agency was working to preserve the state’s investment in Susitna-Watana. This summer’s work will include permit compliance, permit closeout, equipment removal, inventorying equipment and site remediation, AEA said.

“The recent announcement means that we will remove equipment this summer that we had intended to leave over winter and remove next summer,” the agency said.

- KRISTEN NELSON