Providing coverage of Alaska and northern Canada's oil and gas industry
April 2023

Vol. 28, No.17 Week of April 23, 2023

Chugach Electric pursuing clean energy

Utility says that it is making progress in integrating variable wind and solar with its firm hydro and gas energy sources

Alan Bailey

for Petroleum News

Anchorage based electric utility Chugach Electric Association says that it is making meaningful progress in its efforts to integrate variable wind and solar energy supplies with its firm power from hydroelectricity and gas-fired power generation. The statement comes amid growing concerns about future natural gas supplies from Cook Inlet and increasing interest in new low-carbon energy resources.

Bettina Chastain, Chugach Electric board chair, and Arthur Miller, the company’s chief executive officer, have commented that the utility recognizes the need to diversify its energy production to include new low-carbon, renewable energy resources that complement the utility’s dwindling natural gas resources, in the context of the continuing need for reliable and affordable electricity.

“We are aggressively pursuing new clean energy projects in a manner that allows us to maintain the lowest rates on the Railbelt, supported by new technologies that enhance the potential of our existing assets to balance, or integrate, variable clean energy resources,” the two executives said.

Expanding the generation mix

Currently about 82% of the utility’s electricity comes from natural gas fueled power generation, 15% from hydro and 3% from wind. In addition, about 0.1% of the utility’s power comes from solar energy bought back from the utility’s members. The utility’s strategy for assuring reliable electricity supplies is to avoid dependence on any one energy source by expanding its generation mix to include proven technologies such as hydro, wind and solar.

“Together with our efficient natural gas generators, energy storage technologies, and modern control systems, we can diversify our energy mix and provide reliable power when it is needed throughout the year,” the executives said.

In 2022 the Chugach Electric board added decarbonization goals to the utility’s strategic plan, to reduce the utility’s carbon intensity by at least 35% by 2030 and at least 50% by 2040, relative to the carbon intensity in 2012. The plan is to achieve this without negatively impacting electricity rates.

Integrating variable energy

The utility says that it is making meaningful progress in integrating variable clean energy into its existing hydro and gas-fueled firm power sources. For example, with support from the Alaska Energy Authority and the state Emerging Energy Technology Fund, the utility has implemented a hybrid flywheel and battery energy storage system to help regulate the varying power output from a wind farm on Fire Island, offshore Anchorage.

And in 2021 the utility issued a request for proposals for renewable energy projects to add at least 100,000 megawatt hours of energy per year to its power supplies. As a consequence, the utility is now conducting feasibility studies for two utility-scale projects, one a wind project and the other a solar project. If these projects prove to be economically viable, without negatively impacting electricity rates, they could exceed Chugach Electric’s original goal for the RFP by supplying more than 20% of the utility’s annual energy, the executives said.

In addition, last year the Regulatory Commission of Alaska approved a request by the utility to triple the utility’s net metering allowance that compensates members for small-scale solar and wind power that they feed back into the electricity grid.

Battery storage

In another initiative, Chugach Electric is purchasing a large-scale battery energy storage system that it plans to install in Anchorage in 2024, to improve the reliability and quality of its services. The utility is also evaluating and pursuing U.S. Department of Energy funding opportunities for other potential initiatives, including long-term energy storage; modern protection and control systems; and carbon capture technology. The utility also says that it is partnering with other utilities, Alaska Native corporations, the state of Alaska and other organizations to enhance the benefits from advances in technology for all Alaskans.

“We will continue to work towards diversifying our energy resources, while maximizing the value of our existing investments and maintaining reliable service to our members,” the executives said. “Chugach is proud to innovate and invest in clean energy and we are committed to our vision of responsibly developing clean energy resources for a clean, sustainable future for Alaska.”

Railbelt initiatives

In a broader context, the utilities in the Railbelt region, including Chugach Electric, are pursuing a plan for major upgrades to the region’s electricity transmission system. The elimination of single points of failure in the system and an increase to the system’s power carrying capacity would significantly improve the system’s capability to support new clean energy power generation. With a potential cost of just under $3 billion, the utilities are seeking federal and state funding assistance for the proposed upgrades, Chugach Electric said.

Another factor that relates to the future mix of power generation on the Railbelt is the recent Regulatory Commission of Alaska certification of the Railbelt Reliability Council as the electric reliability organization for the Railbelt. One of the RRC’s roles will be to develop and maintain an integrated resource plan for the Railbelt’s high voltage electrical system. That plan will presumably encompass a strategy for the deployment of renewal energy power generation.

Chugach Electric says that it looks forward to integrating its plans and efforts into the RRC’s procedures, once those procedures are fully developed. Currently the RRC is in the process of ramping up its organization and moving into operation, with the integrated resource plan potentially taking several years to develop.

“While the RRC grows and matures, Chugach will continue to pursue technologies to support decarbonization and diversification of our energy resources, and collaborate with other utilities to improve transmission projects across the state,” Chugach Electric told Petroleum News.

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