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HOUSE BILL NO. 312
IN THE LEGISLATURE OF THE STATE OF ALASKA
THIRTY-FOURTH LEGISLATURE - SECOND SESSION
BY REPRESENTATIVE MCCABE
Introduced: 2/18/26
Referred: House Special Committee on Energy, Resources
A BILL
FOR AN ACT ENTITLED
"An Act relating to a state energy policy; relating to the green energy grant fund; and 1
providing for an effective date." 2
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 3
* Section 1. AS 38.95.430 is amended to read: 4
Sec. 38.95.430. Carbon offset revenue. Twenty percent of the revenue 5
generated from the carbon offset program shall be deposited into the green 6
[RENEWABLE] energy grant fund (AS 42.45.045). The remaining 80 percent of the 7
revenue from the carbon offset program shall be separately accounted for under 8
AS 37.05.142 and may be appropriated by the legislature. 9
* Sec. 2. AS 42.05.141 is amended by adding a new subsection to read: 10
(j) The commission shall consider the state energy policy described in 11
AS 44.99.115 in performing the duties assigned to the commission. 12
* Sec. 3. AS 42.45.010(m) is amended to read: 13
(m) A loan for a green [RENEWABLE] energy resources project in which the 14
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cumulative state monetary involvement, through loans, grants, and bonds, is at least 1
$5,000,000 may not be granted for a term that exceeds 50 years and may, 2
notwithstanding (f)(2) of this section, be granted at an interest rate that is the lesser of 3
(1) three percent lower than the rate determined under (f)(2)(A) of this 4
section, but not less than one percent; or 5
(2) a rate equivalent to the rate determined under (f)(2)(B) of this 6
section. 7
* Sec. 4. AS 42.45.010(n) is amended to read: 8
(n) In (m) of this section, "green [RENEWABLE] energy resources" has the 9
meaning given in AS 42.45.045 [AS 42.45.045(l)]. 10
* Sec. 5. AS 42.45.045(a) is amended to read: 11
(a) A green [RENEWABLE] energy grant fund is established as a separate 12
fund to finance certain energy projects in the state [ALASKA]. 13
* Sec. 6. AS 42.45.045(d) is amended to read: 14
(d) The authority shall, in consultation with the advisory committee 15
established under (i) of this section and the Department of Natural Resources, 16
(1) develop a methodology for determining the order of projects that 17
may receive assistance, including separate requirements for grant eligibility, and adopt 18
regulations identifying criteria to evaluate the benefit and feasibility of projects for 19
which an applicant applies for support from the legislature, with the most weight being 20
given to projects that serve any area in which the average cost of energy to each 21
resident of the area exceeds the average cost to each resident of other areas of the 22
state, and significant weight being given to a statewide balance of grant funds and to 23
the amount of matching funds an applicant is able to make available; 24
(2) make recommendations to the legislature for green 25
[RENEWABLE] power production reimbursement grants; and 26
(3) not later than 10 days after the first day of each regular legislative 27
session, submit to the legislature a report summarizing and reviewing each grant 28
application submitted under this section and a recommended priority for awarding 29
grants. 30
* Sec. 7. AS 42.45.045(e) is amended to read: 31
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(e) In consultation with the advisory committee established in (i) of this 1
section, the authority shall make recommendations to the legislature regarding eligible 2
applicants' projects that finance feasibility studies, reconnaissance studies, energy 3
resource monitoring, and construction of green [RENEWABLE] energy projects [, 4
NATURAL GAS PROJECTS,] or transmission or distribution infrastructure located in 5
Alaska that meet the requirements of (f), (g), or (h) of this section, as applicable, and 6
shall, at least once each year, solicit from the advisory committee funding 7
recommendations for all grants. 8
* Sec. 8. AS 42.45.045(f) is amended to read: 9
(f) For a renewable energy project to qualify for a grant recommendation 10
under (e) of this section, the project must 11
(1) be a new project not in operation on August 20, 2008 or an addition 12
to an existing project made after August 20, 2008; and 13
(2) be a 14
(A) hydroelectric facility; 15
(B) direct use of green [RENEWABLE] energy resources; 16
(C) facility that generates electricity from fuel cells that use 17
hydrogen from green [RENEWABLE] energy resources [OR NATURAL 18
GAS]; or 19
(D) facility that generates energy from green [RENEWABLE] 20
energy resources. 21
* Sec. 9. AS 42.45.045(h) is amended to read: 22
(h) To qualify for a grant recommendation under (e) of this section, 23
transmission or distribution infrastructure must link a green [RENEWABLE] energy 24
project [OR NATURAL GAS PROJECT] to the transmission or distribution 25
infrastructure. A grant may be recommended under this subsection even if the grant 26
applicant is not itself financing the construction of the green [RENEWABLE] energy 27
project [OR NATURAL GAS PROJECT]. 28
* Sec. 10. AS 42.45.045(l)(5) is amended to read: 29
(5) "green [RENEWABLE] energy resources" means 30
(A) wind, solar, geothermal, wasteheat recovery, hydrothermal, 31
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wave, tidal, river in-stream, or hydropower; 1
(B) low-emission nontoxic biomass based on solid or liquid 2
organic fuels from wood, forest and field residues, or animal or fish products; 3
(C) dedicated energy crops available on a renewable basis; 4
[OR] 5
(D) landfill gas and digester gas; 6
(E) nuclear reactors; 7
(F) natural gas extracted and processed in the state; or 8
(G) any other energy resource that when used to generate 9
energy releases 10
(i) emissions equivalent to or lower than energy 11
generated from pipeline-quality natural gas; and 12
(ii) less air pollution than energy generated, without 13
the use of clean coal technology, from coal that is mined and 14
processed in the state. 15
* Sec. 11. AS 42.45.045(l) is amended by adding a new paragraph to read: 16
(6) "clean coal technology" means a method or system for deriving 17
energy from coal that 18
(A) captures at least 90 percent of carbon dioxide emissions 19
through carbon capture utilization or storage; and 20
(B) reduces sulfur dioxide, nitrogen oxide, and particulate 21
matter emissions to levels below current federal standards. 22
* Sec. 12. AS 42.45.085(d) is amended to read: 23
(d) If the earnings of the fund for the previous closed fiscal year, as calculated 24
under AS 42.45.080(c)(2), exceed the appropriation under (a) of this section for the 25
current fiscal year, the legislature may appropriate 70 percent of the difference 26
between the earnings of the fund for the previous closed fiscal year, as calculated 27
under AS 42.45.080(c)(2), and the appropriation made under (a) of this section for the 28
current fiscal year as follows: 29
(1) if the amount calculated under this subsection is less than 30
$30,000,000, that amount to a community revenue sharing or community assistance 31
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fund; or 1
(2) if the amount calculated under this subsection is $30,000,000 or 2
more, 3
(A) $30,000,000 to a community revenue sharing or 4
community assistance fund; and 5
(B) the remaining amount, not to exceed $25,000,000, to the 6
green [RENEWABLE] energy grant fund established under AS 42.45.045, to 7
the bulk fuel revolving loan fund established under AS 42.45.250, or for rural 8
power system upgrades or to a combination of the funds or purposes listed in 9
this subparagraph. 10
* Sec. 13. AS 44.83.080 is amended by adding a new subsection to read: 11
(b) The authority shall consider the state energy policy described in 12
AS 44.99.115 in performing the duties assigned to the authority. 13
* Sec. 14. AS 44.99.115 is amended to read: 14
Sec. 44.99.115. Declaration of state energy policy. The State of Alaska 15
recognizes that the state's economic prosperity is dependent on available, reliable, and 16
affordable residential, commercial, and industrial energy to supply the state's electric, 17
heating, and transportation needs. The state also recognizes that worldwide supply and 18
demand for fossil fuels and concerns about global climate change will affect the price 19
of fossil fuels consumed by Alaskans and exported from the state to other markets. In 20
establishing a state energy policy, the state further recognizes the immense diversity of 21
the state's geography, cultures, and resource availability. Therefore, it is the policy of 22
the state to 23
(1) institute a comprehensive and coordinated approach to supporting 24
energy efficiency and conservation by 25
(A) encouraging statewide energy efficiency codes for new and 26
renovated residential, commercial, and public buildings; 27
(B) decreasing public building energy consumption through 28
conservation measures and energy-efficient technologies; and 29
(C) initiating and supporting a program to educate state 30
residents on the benefits of energy efficiency and conservation, including 31
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dissemination of information on state and federal programs that reward energy 1
efficiency; 2
(2) encourage economic development by 3
(A) promoting the development of renewable, green, or [AND] 4
alternative energy resources, including geothermal, wind, solar, hydroelectric, 5
hydrokinetic, tidal, and biomass energy, for use by Alaskans; 6
(B) promoting the development, transport, and efficient use of 7
nonrenewable, green, or [AND] alternative energy resources, including natural 8
gas, coal, oil, gas hydrates, heavy oil, and nuclear energy, for use by Alaskans 9
and for export; 10
(C) working to identify and assist with development of the 11
most cost-effective, long-term sources of energy for each community 12
statewide; 13
(D) creating and maintaining a state fiscal regime and 14
permitting and regulatory processes that encourage private sector development 15
of the state's energy resources; and 16
(E) promoting the efficiency of energy used for transportation; 17
(3) support energy research, education, and workforce development by 18
investing in 19
(A) training and education programs that will help create jobs 20
for Alaskans and that address energy conservation, efficiency, and availability, 21
including programs that address workforce development and workforce 22
transition; and 23
(B) applied energy research and development of alternative and 24
emerging technologies, including university programs, to achieve reductions in 25
state energy costs and stimulate industry investment in the state; 26
(4) coordinate governmental functions 27
(A) by reviewing and streamlining regulatory processes and 28
balancing the economic costs of review with the level of regulation necessary 29
to protect the public interest; 30
(B) by using one office or agency, as may be specified by law, 31
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to serve as a clearinghouse in managing the state's energy-related functions to 1
avoid fragmentation and duplication and to increase effectiveness; and 2
(C) by actively collaborating with federal agencies to achieve 3
the state's energy goals and to meet emissions, renewable, green, or [AND] 4
alternative energy, and energy production targets. 5
* Sec. 15. AS 44.99.115 is amended by adding new subsections to read: 6
(b) The State of Alaska recognizes the need to improve energy grid security in 7
the state by minimizing the reliance on foreign nations and mainland United States 8
sources for critical materials and fuel delivery. The state also recognizes that the Jones 9
Act (P.L. 66-261) imposes significant restrictions on vessels that may transport energy 10
commodities by water between United States' ports, including from mainland United 11
States to the state. Therefore, to promote state energy grid security, it is the policy of 12
the state to prioritize 13
(1) local fuel sources that are primarily produced in the state, including 14
natural gas from the North Slope and Cook Inlet, coal from the Interior region of the 15
state, and nuclear materials processed or deployed by projects based in the state; 16
(2) affordable energy sources that 17
(A) provide cost-effective means of heating, cooling, and 18
generating electricity, with an average cost for each unit of energy output not 19
exceeding rates for comparable sources over the past five years; 20
(B) have stable, predictable costs and consider life-cycle 21
expenses including transportation, storage, and emissions control in the state's 22
Arctic and rural conditions; and 23
(C) deliver substantial savings to homes, businesses, and 24
communities compared to other sources; 25
(3) reliable energy sources that 26
(A) are readily available to meet the demands of residents at all 27
times of day and during all seasons of the year with minimal interruptions 28
during high-usage periods, including peak heating demands in subzero 29
temperatures; 30
(B) include energy generated by hydrocarbons, which may 31
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include natural gas, and clean coal technologies sourced and processed in the 1
state; and 2
(C) for power generation, have a minimum capacity factor of at 3
least 50 percent, continuously dispatchable electricity output, the capability to 4
ramp up or down electricity generation within one hour to stabilize the 5
electrical grid, and the ability to complement and provide backup to renewable 6
energy sources during periods of low availability, which may include periods 7
when less energy is generated from wind or solar during winter months; 8
(4) development of infrastructure necessary to deliver local, affordable, 9
and reliable energy sources to residents, including in-state pipelines, liquefied natural 10
gas terminals, coal-to-liquid facilities, and microgrids for remote communities. 11
(c) In this section, "green energy resource" has the meaning given in 12
AS 42.45.045. 13
* Sec. 16. AS 42.45.045(g) and 42.45.045(l)(4) are repealed. 14
* Sec. 17. This Act takes effect immediately under AS 01.10.070(c). 15