Alaska News

Alaska poised to build largest U.S. river dam in decades on Susitna

Lawmakers are one step away from giving Gov. Sean Parnell one of his biggest political wins of the 2011 legislative session -- the go-ahead for the Susitna River hydroelectric project.

The proposed 700-foot high dam at Watana on the popular recreational river would be the largest dam built in the U.S. in decades. It is projected to provide more than half the Railbelt's power needs when it's operational, anticipated for as soon as 2022.

The Senate on Tuesday passed legislation, Senate Bill 42, would allow the Alaska Energy Authority to own and operate the project, much as Bradley Lake was brought about by the state in the 1980s.

If the Legislature also approves funding for Susitna -- that's still hung up in the political battle over the capital and operating budgets -- the AEA would move ahead with preliminary field studies and begin the application process with the Federal Energy Regulatory Commission.

"This bill would put our state on a new path," Sen. Joe Thomas of Fairbanks told the Senate shortly before it voted unanimously to approve the measure.

The hydro plant is still a long way from being a reality. The pricetag -- $4 billion to $5 billion even with new construction technology -- is controversial and state officials recently said the state would need to heavily subsidize the project in order to keep energy costs affordable.

But it's a favorite project for lawmakers throughout the Railbelt, particularly Fairbanks where energy costs are high.

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Rural lawmakers also have agreed to so far go along with it. Sen. Albert Kookesh of Angoon reminded his colleagues on the Senate floor Tuesday that they have an obligation to help outlying areas, too.

"There are other parts of Alaska that have to be protected and need to have cheap energy also," he said.

The Senate passed the bill to the House, which had already spent weeks via the House Energy Committee vetting a companion measure, House Bill 103. The measure passed by the Senate was nearly identical to what the House had already considered with its measure.

The Senate bill was quickly approved by the House Finance Committee Tuesday afternoon and is now awaiting a vote by the full House, possibly on Wednesday. If unchanged, it would go to the governor for his signature.

Still at issue is the $65.7 million in capital funds for the project. Those are part of the spending plan that is at the heart of the political battle that ended the regular legislative session on Sunday and sent the Legislature into a special session.

The Senate Finance Committee, annoyed at Parnell's threats to veto capital projects if his oil tax bill didn't pass, included contingency language in the capital budget that would eliminate all energy projects, including Susitna, if the governor vetoes a single energy project in that section.

On Tuesday, House and Senate leaders were still negotiating the capital, operating and supplemental budgets, all of which are politically entwined. A conference committee approved some items in the operating budget Tuesday but major elements are still unresolved. The capital and supplemental budgets were slated for finance committee hearings Wednesday morning but those agendas have been vacated repeatedly in the last two weeks.

Contact Patti Epler at patti(at)alaskadispatch.com

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