Alaska looks toward clean energy market while still relying on oil
Gov. Mike Dunleavy and state legislators have said a new bill will move toward clean energy and generate revenue
Alaska Gov. Mike Dunleavy says the state is investigating whether Biden has the authority to scale back the Willow oil project.
Alaska Republican Gov. Mike Dunleavy is holding a conference this week in which his efforts to push the state further into the clean energy market will be on display, even as the state continues to embrace new fossil fuel production.
Dunleavy pushed for a bill that made it through the legislature that would allow the state to take advantage of the sale of so-called carbon credits to companies wanting to offset their carbon emissions. These projects could include credits for improving a forest’s health through thinning or by allowing trees to grow bigger.
The governor is expected to sign the bill on Tuesday.
Lawmakers said the bill would allow Alaska to continue to permit oil drilling, mining and timber activities while also moving into the market for sequestering carbon dioxide.
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Alaska Republican Gov. Mike Dunleavy is holding a conference this week in which his efforts to push the state further into the clean energy market will be on display. (Getty Images)
Some environmental experts, however, dispute its impact as the governor and legislators have said the goal is not about restricting emissions but generating additional revenue.
"There's kind of a field of dreams quality to this issue. ‘If you plant the trees and create credits, will anyone buy them?'" said the University of Michigan’s Barry Gabe, a political scientist who studies environmental and climate politics.
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"What's just not clear is what that market would look like and whether or not purchasers ... will find that an attractive investment," he said. "That's the leap of faith."
Alaska has no carbon emissions reduction goals or overarching climate plan while relying heavily on oil production. The state is also experiencing the impacts of the changing climate, including coastal erosion threatening Indigenous villages, unusual wildfires and thinning sea ice.
The Willow Project being developed by ConocoPhillips Alaska could produce up to 180,000 barrels of oil per day. Environmentalists who say the U.S. should be moving away from new drilling due to climate change are challenging the initiative in court.
The Biden administration approved of the project earlier this year.
Republican state Sen. Shelley Hughes, who was not initially supportive of the carbon credit concept, ultimately decided to embrace it to win over resource development projects, such as Willow.
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Alaska Gov. Mike Dunleavy addresses reporters during a news conference. (AP / AP Newsroom)
"I think that in order to get capital investment into our state, we are going to have to be perceived in a way that is trying to work through all of this," she said during the recent legislative debate.
The bill would allow the state to establish carbon sequestration projects on forestland and sell credits to companies looking to offset their emissions. A portion of the revenue from these sales then goes to a state fund that supports renewable energy projects.
The measure would also allow the state to lease lands to third parties that want to manage sequestration projects of their own.
Another proposal from Dunleavy that set up a regulatory system allowing underground storage of carbon dioxide failed to advance this session. It would have generated an additional form of income for the state and the bill could pass during next year's legislative session.
This 2019 aerial photo provided by ConocoPhillips shows an exploratory drilling camp at the proposed site of the Willow oil project on Alaska's North Slope. (ConocoPhillips via AP / AP Newsroom)
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Dunleavy is expected to tout the newly passed credit offset plan this week at the Alaska Sustainable Energy Conference, which he created in part "to show the world what Alaska has to offer," according to spokesperson Grant Robinson.
A Republican lawmaker said the legislation will allow Alaska to take advantage of the demand for carbon emissions offsets from companies already doing business in the state that might choose to go elsewhere.
"So if they’re going to do it anyways, and they're going to operate [on] Alaskan lands, then why shouldn’t we provide the service of carbon offsets to these companies?" Republican state Rep. Kevin McCabe said. "At least then it stays in Alaska, and we get some benefit to our state treasury for it."
The Associated Press contributed to this report.