utting the role of solar energy into terms Alaskans can understand, Chris Rose draws an analogy. “It’s like fishing in the summer or hunting in the spring and fall,” says Rose. “While you can’t do these things year-round, you harvest what you can when you can so that you have it available when you need it.”
Rose, founder and executive director of Renewable Energy Alaska Project, notes that half of the state’s electricity comes from natural gas, which is becoming a problem. Communities in Cook Inlet are already paying three times more than residents in the Lower 48 are paying for natural gas, and that amount is about to go up. Due to dwindling supplies, Alaska utilities are looking at importing liquified natural gas from Outside, which is expected to raise costs by 50 percent or more in the next five years.
“Even though natural gas is a local resource, it’s not a cheap resource,” says Rose. “Fossil fuels are expensive and getting more expensive, so if we can generate local power with no fuel costs, there are a lot of advantages to that.”
By using renewable energy most of the year, natural gas can be conserved for use during the winter. To this end, several projects—both at the state and community levels—are underway to harness the midnight sun. Federal funding is also supporting more projects, especially in rural areas, that could help the state become even more energy independent.
The $125 million splits between two projects: $62.5 million was awarded to a partnership between the Alaska Energy Authority and the Alaska Housing Finance Corporation (AHFC) to fund solar energy infrastructure around the state. Alaska Energy Authority will use the grant for communities seeking to develop solar arrays, including battery storage, and AHFC will administer a program to subsidize residential rooftop solar installations for low-income households.
The remaining $62.5 million was awarded to the Tanana Chiefs Conference, in partnership with the Alaska Native Tribal Health Consortium and AHFC, to invest in solar energy for thirteen tribal communities along the Railbelt, including Nenana and Chickaloon.
In addition, the US Department of Energy recently funded five Alaska projects through the Energy Improvement in Rural or Remote Areas program, two of which are solar.
The first provides $54.8 million to ensure reliable access to energy and heating for eleven Alaska Native villages in the Northwest Arctic Borough through the planned installation of solar, battery storage, and heat pump systems. The borough will use this money to install 850 residential heat pumps, or almost one for every home in Ambler, Buckland, Deering, Kiana, Kivalina, Kobuk, Noatak, Noorvik, Selawik, and Shungnak. NANA Regional Corporation is matching $5 million for this project, which builds on previous energy diversification efforts in the region.
The second award, an Alaskan Tribal Energy Sovereignty project, provides $26 million to Tanana Chiefs Conference to expand solar projects in eight tribal communities including Minto, Huslia, Nulato, Kaltag, Grayling, Anvik, Shageluk, and Holy Cross. Instead of relying on diesel generators, solar panels and battery storage would be integrated into each community’s microgrid, a process that is expected to take approximately five years.
The US Department of Agriculture’s Rural Energy for America program provided a $460,000 federal grant in March 2024 to expand a solar power system at Whistle Hill in Soldotna. The final phase of the two-stage project is expected to be completed this summer by Peninsula Solar, which is installing a 200 kW solar system with 500 kW of battery storage that will have the ability to generate and sell electricity to commercial indoor herb garden fresh365 and three other businesses on site. The annual production of the completed system is estimated to produce enough electricity to power nineteen homes.
The utility’s first attempt to create a small community solar farm in Anchorage was rejected in 2019.
The CEA program would allow members without their own rooftop solar array, such as renters, to benefit from renewable energy by subscribing to buy power from the solar farm. Under the plan, a member could subscribe to receive power from one panel or up to twenty panels, paying a monthly fee.
The community solar project would generate electricity equivalent to an average of 0.02 percent of CEA’s retail energy sales annually. CEA would own the project, estimated to cost about $2.8 million.
Member applications will be accepted beginning October 1, and construction is expected to be completed by the end of 2024, with the program going live by March 1, 2025.
CEA is also planning to put solar panels on its two major power plants, the Southcentral Power Project near its headquarters along Minnesota Drive and the George M. Sullivan Plant along the Glenn Highway. The projects, which are anticipated to be roughly 100 kW each, will increase the efficiency of the plants and offset the use of natural gas. Solar panels will also be installed as part of a remodel of the operations building on CEA’s South Campus, which will add an additional estimated 165 kW of solar capacity to the system.
The $2.2 million solar farm at Shungnak, completed last fall, is now generating power for Shungnak and Kobuk. An electrical intertie connects the two villages, located about 10 miles apart on the Kobuk River. The farm on which the 225 kW project sits is owned by the two tribal governments, which enables them to sell the power to the Alaska Village Electric Cooperative, the largest electric utility in rural Alaska. This spring, the solar farm produced so much power that the diesel-fed power plant shut down for several hours a day.
Alaska’s largest solar farm, located in Houston, began operating in September 2023 and is now feeding power to Matanuska Electric Association. The 45 acre, 8.5 MW farm can provide about 5 percent of the utility’s output, powering about 1,400 homes at peak production, for roughly the same cost as gas-fired generation.
Senate Bill 152 (SB152) creates a streamlined framework to establish community energy projects in Alaska, including those powered by solar, hydroelectric, and wind. The bill, titled “Saving Alaskans Money with Voluntary Community Energy (SAVE) Act,” enables Alaskans to subscribe to community-owned solar arrays not located on their home or property.
According to lead sponsor Senator Bill Wielechowski, SB152 opens clean energy access for the first time to more than 260,000 Alaskans who live in rental housing and 79,000 who are living below the federal poverty level. He expects subscribers could see 10 to 20 percent savings on their monthly electric bills.
“Renewable energy is becoming increasingly important, particularly with the decline in natural gas production in Cook Inlet,” says Wielechowski. “It is also spurred by the desire of many to have cleaner energy and lower energy costs, which can be provided, in part, by renewable energies like solar and wind. This will not only benefit consumers in Southcentral Alaska but people across the state.”
He notes that, by providing regulatory certainty to consumers and independent power producers, more people will become interested in virtual net metering—a solar incentive program that allows people to participate in the green energy economy without installing solar panels themselves.
In addition to solar energy, SB152 supports access to other forms of renewable energy, including tidal and wind power, and it includes a component for battery storage to provide utilities with increased capacity.
“This would help in areas like Southcentral, where this past January we weren’t able to produce enough gas or pull enough out of the storage wells,” says Wielechowski. “Every kilowatt provided by renewable energy uses one less kilowatt from gas, which can be put into storage for a later time.”
Wielechowski also anticipates that SB152 could attract more solar companies to Alaska as well as create more jobs. With substantial current federal tax credits of 30 to 50 percent, there are also tremendous incentives to build right now.
According to Rose, green banks in other states have been instrumental in providing affordable loans to consumers who want to make energy efficiency improvements or install rooftop solar.
“One of the problems with current programs is that, while you can get a 30 to 40 percent tax credit for using renewable energy, you have to have the upfront capital to build the project first,” he explains. “The green bank will provide a huge opportunity for average Alaskans to get affordable loans, install rooftop solar, and take advantage of federal tax credits.”
Rose adds that excess electricity from these projects can feed the entire grid. “The utility pays nothing for those generation resources to be put on roofs; people buy them, and the federal government helps finance these solar projects,” he says.
According to the National Renewable Energy Laboratory, if Railbelt utilities produced 76 percent of their power from renewable sources by 2040, rate payers could save more than $1 billion over the next sixteen years.
“While the economics are important, Alaskans also like to be independent and provide for themselves—that’s why we garden and hunt,” says Rose. “If we can also generate our own power, it provides even more independence. We can’t be very energy independent if we have to import our gas.”