Funding issues, local opposition, and permitting hurdles are grinding the progress of the proposed Connelly Lake hydroelectric project to a slow crawl.
Officials from project developer Alaska Power & Telephone say public perception and opposition to the project have contributed to its under-funding. The Alaska Energy Authority’s Renewable Energy Fund recently ranked Connelly Lake 45th on its list of projects to possibly receive funding. AP&T asked for $1.7 million; the AEA said it would give $180,000, if anything at all.
“So we’re outside the first $25 million, which is what the Legislature usually grants. We’re also outside the second $25 million, which could be granted, but it not always is,” said Danny Gonce, AP&T’s power manager for Haines.
Glen Martin, project manager for Connelly Lake, and AP&T President Robert Grimm said in interviews that negative public perception of the project is making it difficult to secure funding.
“I know it would be pretty hard for me to sell putting money into this to my shareholders with this kind of opposition. It’s in trouble,” Grimm said.
“Perception has been part of why AEA has not rated us as high for funding at this time,” Martin said.
In a letter sent last August, the Federal Energy Regulatory Commission (FERC) rejected a request by AP&T to use a traditional licensing process to develop the project.
Comments against the traditional licensing process included ones from 25 individuals and from the U.S. Fish and Wildlife Service, National Marine Fisheries Service, Alaska Department of Fish and Game, Haines Borough Mayor Stephanie Scott, Haines Borough Assembly, Alaska Native Brotherhood and Sisterhood, Southeast Alaska Conservation Council, Lynn Canal Conservation, Rivers Without Borders, and Alaska Chilkoot Bear Foundation.
In the letter, FERC said it would not devote time or other resources to the licensing process for Connelly Lake until AP&T could secure permitting for ground-disturbing activities in the Alaska Chilkat Bald Eagle Preserve. AP&T is still in discussions with the state Department of Natural Resources to acquire a permit for building its powerhouse in the preserve.
On Jan. 14, Martin sent a letter to FERC with copies of state permits allowing AP&T to conduct field studies in the preserve, hoping they might be enough to change FERC’s mind about moving forward with the licensing.
“I’m thinking, at minimum, these two permits ought to start their process, but we’ll just have to see how FERC responds…I don’t know why they wouldn’t. Then again FERC occasionally surprises me,” Martin said.
Whether or not the state will allow construction in the preserve is still up in the air, but Martin said gray legal language guiding the permit may could allow for the issuance of a permit to AP&T.
Additionally, AEA Deputy Director of Statewide Energy Policy Development Gene Therriault said access issues like this are not unique to Connelly Lake. Therriault said that when the Alaska Legislature designated special areas like the eagle preserve, energy prices were a lot lower than they are today and alternative energy sources and access routes to them may not have been considered.
“I am aware that there is likely to be some legislation introduced this year that deals with that kind of access issue,” Therriault said.
Grimm said it is frustrating to encounter public opposition and cumbersome access issues when he feels Connelly Lake offers the best solution to providing ample and sustainable energy for the Upper Lynn Canal.
“If you can’t get this project through, I don’t know what the alternatives are. It would be back to much smaller projects like Walker Lake and then you’re going to need a bunch of them. It’s the choice: Have 12 projects or one. It’s a difficult situation,” Grimm said.