Rep. Chuck Kopp, R-Anchorage, third from left, speaks at a Jan. 9, 2025, forum in Anchorage hosted by the Resource Development Council for Alaska and the Alaska Support Industry Alliance. Flanking Kopp are, from left, Sen. James Kaufman, R-Anchorage; House Speaker Bryce Edgmon, I-Dillingham; Rep. Mia Costello, R-Anchorage; Rep. Andy Josephson, D-Anchorage; and Rebecca Logan, chief executive of the Alaska Support Industry Alliance. (Photo by Yereth Rosen/Alaska Beacon)
Last year’s session of the Alaska Legislature put a big focus on energy and alleviating an impending shortage of the Cook Inlet natural gas that powers the most populous part of the state.
This year, even though some of the membership changed a bit with the election, Alaskans can expect the same focus from the Legislature, leading lawmakers said at a resource industry forum in Anchorage on Thursday.
Incoming House Speaker Bryce Edgmon, I-Dillingham, said one thing likely to be produced by the 34th Alaska Legislature is a follow-up to last year’s bill that modernized the utility system along the Railbelt, the corridor running from Fairbanks to Anchorage to the Kenai Peninsula.
That measure, House Bill 307, put into law many long-desired facets of energy delivery to the state’s most densely populated region, like a unified transmission system and a system to create a portfolio of energy sources, including renewables, Edgmon said. Additionally, the state is benefitting from hundreds of millions of dollars in federal money for energy upgrades and diversification, he said.
“We’re turning a chapter in energy here in Alaska. I’m pretty excited about what we’re going to do over the next couple of years,” Edgmon said at the event held by the Resource Development Council for Alaska and the Alaska Support Industry Alliance.
One idea likely to come up again is royalty relief for Cook Inlet natural gas producers. The House passed a bill last year that would have reduced state royalties on new natural gas and oil produced from the inlet, but state senators were skeptical about whether benefits would result and dropped the idea. In the end, lawmakers passed a wide-ranging bill, House Bill 50, that incorporated numerous Cook Inlet and Railbelt energy provisions but omitted the House-approved Cook Inlet royalty relief.
Rep. Andy Josephson, D-Anchorage, supported last year’s bill and presented a case at the RDC-Alliance event for reconsidering reduced Cook Inlet royalties.
Making such reductions, “frankly, is not very expensive for the state because the royalty share in Cook Inlet is so small anyway,” and provides minimal funding for the state, he said.
Josephson acknowledged that the state’s past experience with financial incentives granted by the Legislature to Cook Inlet producers had some negative consequences. Tax credits approved more than a decade ago proved very expensive, costing around $1 billion, and were only recently paid off, he said.
“You’re not going to see that sort of subsidy. But I think there’s more that we can do,” he said.
Along with a new look at royalty relief, which he said “is surely going to continue to be a topic, front and center, for both chambers,” lawmakers could try to do something to address what has been the lack of Cook Inlet producers’ ready access to a jack-up rig.
Jack-up rigs are mobile floating platforms that are used in offshore oil and gas drilling.
Rep. Chuck Kopp, R-Anchorage, the incoming House majority leader, said resource-development issues addressed by lawmakers will go beyond natural gas and oil.
“I think our mining industry is going to get a lot more attention in this Legislature. We are at a point where we can no longer afford to allow a lot of the permitting issues, a lot of the activism against these projects to continue to stall the critical mineral needs not only that Alaska has but our nation needs,” Kopp said.
With global insecurity that “is unprecedented right now,” the nation faces potential shortages of critical minerals, Kopp said.
“We’re being cut off. We are no longer going to be able to get them from China, Russia, Ukraine,” he said. Minerals like antimony are needed for high-tech products and for national defense, “and Alaska has all these things,” he said.
Senate President Gary Stevens, R-Kodiak, pleaded with the resource-industry audience to pay more attention to seafood.
He said he was bothered by the lack of seafood industry representation in the room; he found only two people from the industry after asking for a show of hands.
“Years ago, when I would come to the RDC there was a big representation of the fishing industry. I don’t see that anymore. What’s happened?” he said. “My charge to you is, for God’s sake, represent resources, not just oil and gas, not just mining, but fisheries is extremely important.”
And he noted that he is heading a task force that is working on recommendations to help rescue Alaska’s ailing but huge seafood industry. “We’re trying to save an industry in crisis,” he said.
Lawmakers at the event said it continues to be challenging to craft a budget during a time of diminished revenues.
What should not be driving the budget, said Sen. Jesse Bjorkman, R-Nikiski, is any promise of a supersized Alaska Permanent Fund dividend.
“We have to move past this idea that Alaskans are entitled to this one thing, and that’s the most important thing ever. Because it’s not,” Bjorkman said.
He talked to thousands of Kenai Peninsula residents while campaigning this summer and fall, and very few mentioned the dividend as important to them.
“They care about roads and schools and public safety,” he said. And on the Kenai Peninsula, they care about fish, he added.
Addressing all those needs costs money and requires a commitment to invest in the state, he said.
The budget that Gov. Mike Dunleavy proposed to the Legislature in December includes a Permanent Fund dividend of about $3,800 per Alaska resident and a projected deficit of $1.5 billion.
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