Alaska spending thaw to resume FERC licensing studies for 600-MW Susitna-Watana hydro project

Within days of a state filing advising the Federal Energy Regulatory Commission that the cash-strapped Alaska government was continuing a spending freeze on the 600-MW Susitna-Watana hydroelectric project, there was a thaw that is to allow the project’s FERC pre-licensing studies to resume.

FERC approved an Alaska Energy Authority request in January to delay licensing proceedings of Susitna-Watana (No. 14241) due to the spending freeze. Gov. Bill Walker issued an administrative order in December directing all state agencies to stop non-obligated spending on six major projects due to a growing state budget deficit related to falling prices of oil, a major source of state revenue.

In response, the AEA hydro project manager, Wayne Dyok, had written FERC asking that the integrated licensing process for the Susitna-Watana project (No. 14241) be suspended for 60 days pending further notice from AEA. FERC granted that request and extended the delay again March 17 and May 13.

Dyok wrote the commission again July 2, saying since AEA’s last report the Alaska Legislature concluded its session and elected not to reappropriate unspent and uncommitted funds previously appropriated to the project.

“The governor signed appropriations bills on June 30, 2015, and AEA is awaiting further direction from the governor’s office,” Dyok wrote.

That direction came a few days later when news reports said a memorandum from the state Office of Management and Budget allowed spending to resume on Susitna-Watana. The memo allows AEA to spend $6.6 million that was previously appropriated by the Legislature but not spent.

AEA spokeswoman Emily Ford was quoted saying release of the funds will allow the FERC pre-licensing process to resume. She said the current goal is to preserve the state’s earlier investments by finishing studies that are near completion and putting collected data into a usable format.

Once that work is carried out to the limit of funding, the Legislature and governor are to determine whether additional funds will be allotted to the estimated $5.5 billion project.

The National Marine Fisheries Service took bids last year for assistance in reviewing fisheries and aquatic studies for Susitna-Watana. Susitna-Watana includes a concrete gravity or rockfill dam of from 700 to 800 feet tall and a crest length of at least 2,700 feet. It would create a 39-mile-long reservoir 90 river-miles northeast of Talkeetna, Alaska.

Based on ongoing feasibility studies, the project’s capacity could be as large as 800 MW. Power would be transmitted north to the interior and south to south-central Alaska along new and existing transmission lines.

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