The Federal Energy Regulatory Commission has approved a request to delay licensing of the 600-MW Susitna-Watana hydroelectric project due to a spending freeze on major state infrastructure projects by the governor of Alaska.
Gov. Bill Walker issued an administrative order Dec. 26 directing all state agencies to stop non-obligated spending on six major projects including Susitna-Watana, which is being developed by the Alaska Energy Authority. Walker said Alaska faces a growing budget deficit related to falling prices of oil, a major source of state revenue.
“Our budget deficit grows deeper as oil prices go lower,” Walker said. “These are large projects that require significantly more state investment to complete. I’ve requested that state agencies not enter into any new contracts until we’ve had a chance to look at the various projects.”
In response, the hydro project manager for Alaska Energy Authority, Wayne Dyok, wrote FERC asking that the integrated licensing process for the Susitna-Watana project (No. 14241) be suspended for 60 days pending further notice from AEA. Study meetings set for Jan. 7 and 8 also were postponed until further notice.
“Due to the uncertainty of the project proposal at this time, we agree that the ILP should be held in abeyance until further notice,” Director Jeff Wright of FERC’s Office of Energy Projects, said Jan. 8. “Doing so would conserve stakeholder resources until the state’s commitment to the project can be clarified.”
In 2013, AEA had convinced FERC to accelerate its environmental study plan schedule so it would not lose the 2013 field study season on Alaska’s upper Susitna River. Also in 2013, FERC rejected an attempt by the National Marine Fisheries Service to force AEA to perform speculative climate change studies as part of licensing the project.
NMFS took bids last year for assistance in reviewing fisheries and aquatic studies for Susitna-Watana. As part of the FERC licensing process, plans propose 58 individual studies of the proposed dam site and surrounding area, 184 miles up the Susitna River above Devils Canyon.
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.