Guv budget cuts dam funds

PALMER — Saying he hasn’t seen enough progress on the project, Gov. Sean Parnell proposed a steep cut in funding for the Susitna Dam project.

“Their timeline for appropriations included having reached land access agreements with the landowners in the area. Those have not been reached and I told (the Alaska Energy Authority) I wanted to see more progress made on land access issues before we moved forward,” Parnell said at a press conference Dec. 12.

The budget, released that same day, still contains a relatively hefty appropriation for the dam, which would be situated 87 miles upriver from Talkeetna. The governor wants to give the project $10 million.

Still, that’s significantly less than the $95 million that was in the last budget. That money put 385 contractors to work on 58 studies to become part of the dam’s application to the Federal Energy Regulatory Commission.

It’s also less than AEA said was needed to meet its timetable for its FERC application. Media reports say that figure was more like $110 million.

But Parnell said it was solely the stalled negotiations on land access rights that prompted him to make the cut.

“There’s no sense in moving forward without that,” he said, citing a need to make sure appropriations are in the public interest. “The way to show me that those expenditures are in the public interest is to show some substantial progress on land access agreements.”

Alaska Native corporations own most of the land in question, and access issues have hampered AEA’s ability to conduct those 58 studies paid for by the last appropriation.

The governor touted his budget as a tightening of the state’s belt to make up for lower tax revenues anticipated following a change in oil tax law, which was backed by the Parnell administration.

Parnell also focused on moves made in his budget to pay down part of the state’s pension debt using money from the state’s savings account. He said that would save future generations a ballooning payment there.

As for the dam, the project would bring 600 megawatts of power online. For comparison’s sake, the Matanuska Electric Association’s gas-fired plant under construction at Eklutna will generate 170 megawatts.

The proposed dam would be 700 feet tall. cost about $4.5 billion to construct and would create a reservoir 39-miles long and up to two miles wide.

Railbelt utilities like the Matanuska Electric Association have come out in favor of the dam. It has the potential to reach the goal then-governor Sarah Palin set in 2009 of generating half the state’s power from renewable sources.

But opposition to the plan is strong. A group recently renamed the Susitna River Coalition ardently opposes the dam, saying it would destroy fishing and hunting opportunities and devastate the salmon population of the river.

The state has said previously that the site chosen is above Devil’s Canyon, which acts as an impediment to salmon spawning. Essentially, the state says, salmon don’t live in the area to be dammed, only Arctic grayling.

Opponents cite evidence showing that no salmon stream has ever been dammed without damaging the fish population.

Contact Andrew Wellner at 352-2270 or andrew.wellner@frontiersman.com.