Renewable energy could reduce, but not replace, imports of costly liquefied natural gas, utilities say

When liquefied natural gas is imported into Southcentral Alaska, and there now seems little doubt it will happen, this will hit Alaskans in the pocketbook. Enstar Natural Gas Co. says imports would cause regional gas costs to consumers to rise by a third.

Electric utilities in the region, mainly Matanuska Electric and Chugach Electric associations, will see their fuels costs rise, too. But MEA and Chugach have alternatives to using gas such as wind, solar and hydro power. That won’t completely offset the need for LNG imports, the utilities say, but it will help.

It will help Enstar, too because more gas will be available for its customers for heating homes and buildings, reducing what the gas company needs to import. Unlike Matanuska Electric and Chugach there are few alternatives for Enstar other than gas.

“The MEA board is focused on diversifying our energy mix to stabilize prices, increase energy security and ensure reliability,” MEA spokesperson Julie Estey said in an email. “MEA is leaving no stone unturned to diversify and ensure stable fuel supply with current natural gas uncertainty. All options are on the table,” she said.

Many projects are being investigated in coordination with Chugach Electric based on the current generation sharing power-pool agreement between the two utilities.

Two significant near-term renewable energy projects MEA and Chugach are working on are both in the Matanuska-Susitna Borough and include a wind project near Mount Susitna that could have a 100 Megawatt to 150 Megawatt capacity depending on decisions made by customers for the power, mainy MEA and Chugach most likely. Little Susitna is being planned by Alaska Renewables, a Fairbanks company.

The savings in natural gas could range from 2.8 billion to 3.5 billion cubic feet of gas yearly depending on the ultimate size of the wind project. MEA and Chugach could reduce their needs for gas depending on how much wind power they agree to buy.

The new solar project in the Mat-Su is “Hawk Lane Phase 2,” being planned by Renewable IPP, also an Alaskan firm. The project involves a major expansion of Renewable Resources’ current smaller project operating near Houston, in the Mat-Su.

The current solar project has a capacity of 8.5 megawatt. Hawk Lane Phase 2 hasn’t been sized yet but it is reported to be similar to a 45 Megawatt Kenai Peninsula solar project, Puppy Dog Lake, planned by the same company. The savings in natural gas for the solar project is roughly estimated at 0.4 billion cubic feet per year.

If both Little Susitna wind and Hawk Lane 2 are built larger scale the annual gas saving could approach 4 billion cubic feet per year.

Dixon Diversion, if built, could increase power generated by the Bradley Lake hydro project by 50 percent, said the Alaska Energy Authority, which is planning the project. This could further reduce the use of gas by 1.7 billion cubic feet per year. Homer Electric Association and Golden Valley Electric in Fairbanks get a share of Bradley Lake hydo power in addition to MEA and Chugach.

The combined gas saving could exceed 5 billion cubic feet per year but this just dents the gas volume now used by Chugach and MEA, which combined is about 18.6 billion cubic feet for power generation, the utilities have said. Enstar separately uses about 38 billion cubic feet a year for its customers, for space heating.