OPINION: We need diverse energy solutions for the Railbelt

Anchorage and the rest of the Railbelt rely heavily on natural gas from Cook Inlet for heating and electricity. Cook Inlet natural gas production is dropping as wells age, and gas producers are not drilling enough replacement wells to keep up. Meanwhile, the largest gas producer in Cook Inlet is not renewing its contracts to supply Anchorage natural gas and electric utilities. Within just five years, if we’re relying on Cook Inlet natural gas, it doesn’t look like we’ll be able to meet the Railbelt’s energy needs.

The governor’s Alaska Energy Security Task Force, in a recent report, recommends “a near-term focus on diversifying electricity generation.” We should follow the report’s advice.

High costs for more of the same

Our gas producers, utilities and some government officials are exploring multiple options to keep the gas flowing, all of which would have serious costs. Some are discussing the Alaska LNG project to bring gas from North Slope fields as a possible solution, but whatever you think of that project, it could not be built in time to meet the looming shortage. Chugach Electric is exploring importing natural gas on tankers from British Columbia, but estimates show that that would increase rates by more than 50%, from about $8.50 per thousand cubic feet (mcf) of gas to $13.50/mcf. There’s also been talk of financial incentives, but producers have identified several additional challenges — including the availability of drilling rigs and support services — that would need to be overcome to boost new exploration.

These solutions would double down on the same finite energy sources that brought us this crisis, and would leave Alaskans to foot the bill, either in the form of increased rates or with significant State subsidies.

A path to a better future

We need to utilize an “all-of-the-above” strategy that includes accelerating renewable energy, promoting efficiency and maintaining existing gas production. These approaches are affordable and within our control.

Utilities across the Railbelt are deploying renewables and upgrading transmission infrastructure, but we need to speed up their timelines. Legislators from across the political spectrum are working on legislation to support utilities’ efforts to quickly deploy renewable energy power for the Railbelt. This legislation would support utilities’ integration of renewables into their supply over time while maintaining competitive balance. Similar legislation has accelerated renewable development in other states, and recent federal incentives have slashed the cost of development. Rapidly deploying renewables will conserve the natural gas we have and provide dependable power for Alaskans.

We can also be more efficient. The federal Inflation Reduction Act presents a big opportunity to retrofit Alaska for energy efficiency at a discount. New tax credits lower homeowners’ costs by up to 30% when installing energy-efficient appliances, windows, insulation and more. The Alaska Finance Housing Corp. is providing support for energy savings, and we should further encourage this by cutting red tape in permitting processes. We also need to ensure our workforce is ready to build a more energy-efficient Alaska.

Finally, we must maintain our existing gas production by holding producers to the terms of their State oil and gas leases. All State leases require that the leaseholders must produce whatever resources are economically recoverable. Producers have a right to invest in their highest-yield assets elsewhere, but a contract is a contract. The State should require that gas producers in the Cook Inlet either fulfill their obligations under those leases — or, in the case of Hilcorp, the largest leaseholder, a 2012 consent decree — and maintain production or sell them to an operator willing to fulfill that contract and produce the gas needed to supply the Railbelt.

There’s no silver bullet tax we can cut or megaproject we can build to escape this problem. Instead, we need an all-of-the-above solution that puts the needs of Alaskan consumers and businesses first. One that puts the tools to solve our problem in our own hands — one wind farm, one new gas well and one double-pane window at a time.

Reps. Donna Mears, Jennie Armstrong, Zack Fields, Alyse Galvin, Andrew Gray, Cliff Groh, Andy Josephson, Genevieve Mina, Calvin Schrage and Andi Story represent Anchorage and Juneau in the Alaska House of Representatives.

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