Last November, Facebook made headlines when it announced plans to build a $760 million Internet server farm in Lulea, Sweden. The cold climate was a factor since all those machines need to be kept cool. But access to long-term, stably-priced energy from hydropower was critical. Server farms use a huge amount of energy -- as much worldwide as some small countries -- and knowing that its cost for energy would stay stable for the long-term played a major role in the social media giant's decision.
In Alaska we are home to vast supplies of energy, yet we have communities that pay some of the highest energy prices in the country. In some rural villages, residents pay more than five times the national average for electricity. Some of the poorest Alaskan households are spending nearly half their income on energy, according to the recent report by Commonwealth North, "Energy for a Sustainable Future."
Even in our urban areas, we face an uncertain energy future. In Anchorage, for example, we rely on natural gas for more than 90 percent of our electricity and more than 50 percent of our heating needs. Although there have been some recent encouraging drilling reports in Cook Inlet, Anchorage utilities have been looking at having to import natural gas as early as 2014 because of a shortfall in supply. This uncertainty is damaging to our communities and to Alaska's long-term economic potential.
It's difficult to attract businesses with so much uncertainty about the cost of energy. Diversifying our energy portfolio to include more local, stable-priced renewable energy sources is a way to stabilize prices and become more attractive to business.
Unlike diesel or natural gas, the fuel cost for renewable energy sources like wind, geothermal and solar is free. People worldwide from insurance companies to the military have recognized this advantage. In fact, the U.S. military, one of the biggest energy users in the world, is aggressively pursuing renewable energy strategies because it has identified reliance on volatile-priced fossil fuels as a strategic security risk.
The good news is many people and companies are already working on diversifying our energy supply. Nationwide, hydropower supplies 7 percent of the country's electricity. Wind power now generates 3 percent of the nation's electricity and in states like Iowa supplies more than 15 percent. Solar is also growing as is geothermal and biomass, and ongoing research and testing of new battery storage, smart grids, and other technologies is only going to improve the reliability and efficiency of these systems.
In Alaska, we're making headway too. Hydropower already supplies 21 percent of our electricity statewide. In addition, more than 20 communities are partially powered by wind, including Kodiak, which is now 89 percent renewably powered with wind and hydro. Kodiak Electric Association reports it has saved a net of $3.6 million in just over two years by generating electricity with wind power instead of buying and burning expensive diesel fuel.
In Anchorage, several developments are on the horizon or already online. By the end of the year, the new 17.6-megawatt Fire Island wind farm is scheduled to be online, as is the 5.6-megawatt landfill methane plant where the city of Anchorage is using methane from our garbage to power Joint Base Elmendorf-Richardson.
The city is also home to a large biodiesel plant. AK Waste in Midtown Anchorage has been churning out 15,000 gallons a month of biodiesel made from cooking oil recycled from local restaurants. The company uses the biodiesel fuel to power its fleet of refuse trucks.
All these local, sustainable sources of energy help diversify our fuel stream, stabilize energy prices and create economic development. There's no doubt developing and implementing these technologies will take time and there will be a learning curve. But these are steps in the right direction to create a long-term, sustainable energy future for our state.
Stephanie Nowers is communications director of Renewable Energy Alaska Project, or REAP, an Alaska-based nonprofit education and advocacy group and host of the annual Business of Clean Energy in Alaska Conference today and Friday at the Dena'ina Civic and Convention Center in Anchorage.