Stock

Banking on ‘green’ for energy independence

Dunleavy proposes investment fund for sustainable energy

With the aim of increasing the state’s energy independence, Gov. Mike Dunleavy introduced a bill last week that would create a so-called “green bank” to help fund sustainable energy projects in the state. Alaska has similar investment programs for other industries, Dunleavy said in an interview with the Empire, and this fund would help individuals and communities access sustainable energy technologies.

“This is a new approach to energy, a new approach to energy independence,” Dunleavy said. “It’s not a bad investment for the people.”

The bill would create an Alaska energy independence program and a fund within the Alaska Industrial Development and Export Authority, Dunleavy said, which would then be used to finance and develop sustainable energy projects in the state. The bill requests an initial $10 million investment of state money to start the fund.

Alaska’s size and remoteness have made it difficult for the private market to provide certain services, energy in particular, at a cost affordable to average people, Dunleavy said. The state has programs such as the Power Cost Equalization fund that subsidize electricity in rural areas due to the high cost of power.

Sustainable energy technologies like wind and solar have become cheaper, Dunleavy said, but are still out of reach for the average homeowner or smaller communities. But governments all over the world have used various investment tools and incentives — commonly referred to as green banks — to help individuals or municipalities purchase sustainable energy technologies.

“This is an opportunity for Alaskans, for individual Alaskans, that has brought the cost of renewables down (in other places),” Dunleavy said.

The fund would need an initial $10 million to get started, the governor said, but in other places where green banks have been used, governments had seen private investments as high a $7-12 for every public dollar. Other states to have successfully used green banks include California, Connecticut, New York and New Jersey, according to the Renewable Energy Alaska Project, a nonprofit sustainable energy group.

Alaska’s initiative is modeled after programs nationwide, the governor’s office said in a news release, and if passed would make Alaska the 20th jurisdiction in the country to use a green bank.

[Governor says help coming for beleaguered tourism industry]

The idea has been discussed for several years, Dunleavy said, but there is currently federal money available to help finance such efforts. Alaska’s lone U.S. Representative, Don Young, a Republican, co-sponsored a national green bank bill last month, which according to the Coalition for Green Capital has the potential to create 5,000 jobs in Alaska. Young’s bill, known as the Clean Energy and Sustainability Accelerator Act, proposes $100 billion in funding nationally for state green banks, according to the congressional record.

The Biden Administration announced Monday a raft of proposals for infrastructure spending across the country with a partial focus on clean energy.

Green banks are investment funds with a specific set of goals, according to CGC, but still expect to be repaid, meaning they heavily scrutinize which projects they decide to invest in, said Morgan Neff, AIDEA’s chief investment officer. Most private banks have lending programs around homes or private property, Neff said, and aren’t familiar with niche projects like sustainable energy production. But Neff said AIDEA is already familiar with Alaska’s unique energy needs and can help make sustainable energy projects attractive to private investors.

“Green banks are designed to help facilitate an environmental need and have a fiscal impact,” Neff said.

Alaskans spend nearly $6 billion annually on energy, he said, and any reduction to that is going to make more of an impact.

In addition to the $10 million for the fund, a small operating budget for AIDEA would be necessary to run the program, Neff said, but the program is designed to be able to pay for itself.

“This allows folks to get financing for retrofitting, for communities to get financing for microgrids,” Dunleavy said. “This is a way for individuals to be more independent.”

Contact reporter Peter Segall at psegall@juneauempire.com. Follow him on Twitter at @SegallJnuEmpire.

More in News

Alaska Senate President Peter Micciche, left, and Senate Minority Leader Tom Begich, right, meet with reporters in Micciche’s office in the early morning hours of Thursday, May 19, 2022, in Juneau, Alaska, after the Legislature ended its regular session. Micciche, a Republican, and Begich, a Democrat, discussed their working relationship, as well as well as parts of the session they were either pleased with or disappointed with. (AP Photo/Becky Bohrer)
After House balks at bigger figure, budget OK’d with $3,200 payout per Alaskan

Budget finishes as second-largest in state history by one measure, but Dunleavy could make cuts

Loren Reese, principal at Kenai Alternative High School, gives Oliver Larrow the Mr. Fix It award Wednesday, May 18, 2022, at Kenai Alternative High School in Kenai, Alaska. (Photo by Jeff Helminiak/Peninsula Clarion)
Kenai Alternative graduates 22, says goodbye to principal

The ceremony included special awards customized for students

Graduates throw their caps into the air at the end of Soldotna High School’s commencement ceremony on Wednesday, May 18, 2022, in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
‘We never fell down’

Soldotna High School honors more than 100 graduates

Brandi Harbaugh gives a presentation during a joint work session on Tuesday, March 2, 2021, in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Mill rate decrease, max school funding included in proposed borough budget

The final document is subject to approval by the Kenai Peninsula Borough Assembly

The 2022 graduating class of River City Academy celebrates Tuesday, May 17, 2022, outside of Skyview Middle School just outside of Soldotna, Alaska. (Photo by Jeff Helminiak/Peninsula Clarion)
River City Academy says goodbye to 19 grads, 2 original staff members

Tuesday’s graduation was the last for two staff members who have been with the school since its beginning

Lawmakers from both bodies of the Alaska State Legislature mingle in the halls of the Alaska State Capitol on Wednesday, May 18, 2022, the last day of the legislative session, following the Senate’s passing of the state’s budget bill. (Peter Segall / Juneau Empire)
Senate agrees to budget, House has until midnight

With hours left in session, House members remain divided

Renewable IPP CEO Jenn Miller presents information about solar power during a meeting of the Kenai Peninsula Borough Assembly on Tuesday, Oct. 12, 2021 in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Assembly OKs new tax exemptions for independent power producers

The ordinance was brought forth in response to a proposed solar farm on the Kenai Peninsula

Kenai Central High School graduates throw caps at the end of their commencement ceremony on Tuesday, May 17, 2022, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
‘Make a great life’

Kenai Central High School graduates more than 75 students

A black bear gets into a bird feeder in April 2005 at Long Lake, Alaska. (Photo courtesy of Alaska Department of Fish and Game)
Watch out for bears, moose

Take precautions to keep attractants away from bears and give moose and calves space

Most Read