Borough declares an energy emergency
Published Friday, May 9, 2008
Digg
del.icio.us
Facebook
Mixx
Reddit
Stumble It!The Fairbanks North Star Borough Assembly on Thursday declared skyrocketing energy costs a public emergency and prepared to put state aid, aimed at boosting energy efficiency in homes, on the fast track.
The assembly also set aside $1.3 million for early design studies on a proposed coal-to-synthetic fuel energy project.
Borough officials said part of the expected state aid — about $8 million from the Alaska Housing Finance Corp. — will go toward analyzing, or “rating,” the energy efficiency of thousands of homes this summer and, prior to that, training energy raters and opening an office to help manage the efforts.
Communities around the state will feel the ripple effects of dramatic expansions to home-weatherization and energy-efficiency programs managed by the housing corporation, a $300 million response by the Alaska Legislature this spring to rising energy costs.
“It is a crisis of generational proportions,” Mayor Jim Whitaker said of the impact rising energy costs could have next year on the Fairbanks economy.
According to the housing corporation, homeowners looking for energy rebates under the program must work with a trained, certified energy rater to analyze their respective homes’ efficiency. The homeowner can then make improvements, get a follow-up inspection, and apply — submitting receipts and a report from the rating specialist — for a rebate check that could reach as high as $10,000 for large-scale improvements.
The rebate program comes as the housing corporation also prepares to expand its long-running weatherization program to cover homeowners making up to the state’s median income ($77,700 for a family of four). The program was previously limited to low-income residents.
Borough officials said they’ll team with the Cold Climate Housing Research Center to get the rebate program on the fast track by training energy raters and contractors.
John Davies, a director at the research center, said the community needs many more trained and certified energy raters — he estimated one-third of homes in Fairbanks could stand to see significant energy-efficiency upgrades.
“If we work really hard we might be able to get to between two (thousand) and four thousand (homes) before the end of this season,” Davies said.
The borough government lacks a formal housing division or department. But Bryan Butcher, a spokesman for the housing corporation, said it’s not unusual for local governments to help connect residents with state housing assistance.
Whitaker said he will update the assembly regularly on how the money is being spent. He also said he’ll report on the progress of a proposal to build a facility for converting coal and biomass to synthetic gas and liquid fuels.
The assembly, which also passed a yearly spending plan and dropped property tax rates to a 20-year low Thursday night, also voted to set aside almost $300,000 from a state grant, and added another $1 million from the borough’s general fund, for early designs for the proposed alternative energy project. The Fairbanks Economic Development Corp. is reviewing proposals from companies interested in designing the project.
Thursday’s ordinance exempts the money for the housing program and the energy project from laws requiring the borough to award contracts to the lowest “responsive and responsible” bidder. The provision drew questions from some at the meeting. Mike Prax cautioned against tossing defined public-purchasing processes in response to the use of the word “emergency” in an ordinance.
“This is a problem,” he said of energy costs. “This isn’t an emergency.”
Some assembly members offered similar concerns but unanimously approved the spending plan, co-sponsored by Whitaker and Assembly member Kelly Brown, without making changes.
Rebates galore
The Legislature approved $100 million this spring to expand the rebate program across the state, part of $300 million for more rebates and weatherization grants. Fairbanks officials have been ahead of others in preparing for the expanded programs, Butcher said, and have worked closely with state housing officials to ready agencies in Fairbanks for the summer, when they expect many homeowners will be looking to upgrade their homes.
“Living in Fairbanks, you know how dire the situation is up there in terms of how much you’re paying for heating fuel,” Butcher said prior to Thursday night’s assembly meeting. “Fairbanks, more than any other, is being very proactive ... to get the word out, to get the work done, in Fairbanks, and we really appreciate that.”
Davies, who last year served on an energy-focused task force as part of a nonprofit think tank, said the committee’s top recommendation was to promote energy efficiency and conservation, something he said will be accomplished by upgrading homes as quickly as possible so they burn less heating fuel or natural gas.
“The energy that we don’t consume is energy that we don’t have to produce or pay for,” he said.
The corporation’s board of directors also recently approved a loan program for energy-efficient upgrades and “retrofits” to existing homes of up to $30,000. Butcher said the loans can be used in conjunction with the new rebate program. Information about the housing corporation’s programs can be found on its Web site (www.ahfc.state.ak.us/energy/weatherization_rebates.cfm).
Community Discussion
Newsminer.com doesn't necessarily condone the comments here, nor does it review every post. Read our full user's agreement.
John Davies, a director at the research center, said the community needs many more trained and certified energy raters. Well how do you get trained?
We can count on about 50% of the available funds being wasted on bureaucratic overhead. Government setting up more government to regulate the program.
Good that they removed the some of the income limitation so that some of those actually paying the cost can also benefit from the program. It is unfortunate, however, that everyone does not get the same benefit or opportunity. After all, they live here and have the same costs.
I'm concerned that the energy rebate program might not reach some of the people who need it the most and the soonest.
The working poor, people who live paycheck to paycheck, will not have the financial means or resources to purchase thousands of dollars of weatherization products and services, even if this money were later fully refunded by a rebate. Some might not have adequate credit ratings to qualify for the home weatherization loans.
Renters who directly pay for their heating and electricity costs might have difficulty participating in the energy rebate program. From what I understand about this program, it doesn't address or make provisions for residents who don't own their homes.
The working poor and renters are two significant segments of the Interior's population who won't be reached by the energy rebate program, and who arguably are among those who need it the most.
Welcome To Interior Weatherization! http://www.interiorwx.org/#
Weatherization Grant Programs
http://www.ahfc.state.ak.us/grants/weath...
The Weatherization Assistance Program is available to renters and homeowners throughout the state. A house may only be weatherized one time and eligibility is determined by the residents income and family size.
http://www.alaskacdc.org/WxInformation.h...
First, just a guess about ALASKA's question about, "How do you get trained?" I do not know but would be willing to bet good money that some civic minded person has already got in place another "non-Profit" to train energy raters, more than likely another X elected offical. Their first meeting will be in Hawaii in December.
I have never "studied" business or have any degrees, other than living for almost 70 years.. and need someone explane this whole "energy" thing to me. Help me. Oil companys sell oil to heat houses, they do it to make a profit for their stock holders and owners.They also pay taxes, provide jobs ect. Now we are going to spent money to TRY to buy less of their products. Now IF this hairbrained idea works, ( as anyone can see it wont) the oil companys sales will go down, causing them to raise their prices to maintain the profit margin they need HA HA,, to stay in business. The end result is higher prices, but at least we have a few "energy raters" that may be able to collect un enployment for a few weeks... Any body thought about building a dam???
James there is a ceiling that is placed on how much can be used from a grant program to pay for overhead of the entity that is in charge of the funds.
MOST of the energy raters (not assistant's, actual energy raters)are engineers. Go to the state website and see what is required to obtain one of there licenses.
How many will upgrade their homes, put them on the market and leave? Is there any requirement that you must live in the house for a period of time as part of accepting free money?
We have a mine mouth powerplant sitting idle in Healy as it has for some years now. The govt. spends approx 8 million a year to maintain it. Ultra-clean coal technology, power-plant employees swear it works. The solution seems obvious.
This is a start, but reducing the oil use of 2.000 houses is but a drop in the bucket. Even if they could reduce everyones energy use by 20%, which they can't, we will still be paying more than we did last winter. In the last month alone the price has gone up almost 20%. If the economists are right and oil climbs to $150-$200 a barrel we will be looking at paying almost double what we payed last winter! I hope the borough doesn't think about banning wood burning, because I'm going to be burning wood like mad next winter.
I too am skeptical. I've seen first hand, the work from some of these local programs on home improvement. Their actual skilled technicians/carpenters are good, but a lot of the base laborers, did very poor work, had little supervision and from hearing them chatting on their phones, are quite over paid.
Yes, it's a shame too many will see this as another opportunity to latch on to the state cash cow, and milk the money in labor costs. This will result in fewer people being helped.
great, so I already did this THIS year. So am I out of luck????????
Gonna be a lot of cheap housing up here soon. It's great that the state feels they have to call this an emergency, this isn't even the middle of the iceberg. Really makes sense to get all these houses winterized when people are going to be losing them soon. I know that if heating oil continues to rise and property taxes stay at their levels people will have to leave. My home has the 5 star plus level already, and my fuel cost was already out of this world last winter. On top of that I also supplement with wood.
These programs are never done right when government comes up with them.
Chain saws are cheap & there are dead trees all around us.
Funny how we have the coldest weather and the most expensive fuel.
Why didn't the borough assembly consider giving a percentage tax break to people who have winterized. Or do they consider weatherization an upgrade. I wonder how much value will be placed on homes that take part in this program and what their tax bill will look like after the new assessment is done for improvements.
Actually, to be an energy rater is pretty simple. Many of the raters are NOT engineers and are simply contractors who do an inspection of the home to meet AHFC energy standards. Unfortunately the quality of work varies considerably and there are definitely conflicts of interest. The energy rater used by my contractor did a poor job, even notarizing a statement he inspected insulation in my neighbor's home...which was missing roof insulation. A call to the liscensing board gets you nowhere.
As an engineer, my client trusts that I do the job thoroughly. That's what they're paying for and I don't forget it. Unfortunately that seems to not be the case with many home and energy inspectors in Fairbanks. Be very careful. This funding looks like a big opportunity for unscrupulous contractors.
The weatherization/energy rebate money is NOT borough money. I hope folks realize this. It is money the legislature appropriated.
However, the $1 million that was given essentially to Fairbanks Economic Development Corporation for design work on an experimental coal-liquids IS from borough general funds. I don't see this addressing the short term "emergency" that was declared. If the Assembly instead appropriated that money toward reducing the borough buildings' energy costs, that could produce a more immediate benefit. For example, they are still using the old inefficient lights in the Borough Administration building. There are hundreds of fixtures that could be retrofitted to reduce their electric use by 30%. Or stick some solar collectors on top of borough owned buildings to reduce electric use. All these savings could go back into property tax savings for our residents.
Last night, the Mayor spoke to the Assembly on why energy prices were so high. He focused on the fundamentals of the oil market; tight supply/demand due the expanding global economy, the possiblilty of "peak oil," etc. Although I don't disagree with his broad anaylsis, He only gave half the explanation for higher energy prices.
To buy a product, two items are needed, a product (oil), and money to exchange for that product. The Mayor completely neglected the issue of our US currency, which is a cornerstone of our economy. I am utterly amazed at how little this subject is being talked about when it comes to the subject of higher prices.
The value of our US Dollar is being destroyed by inflation. Inflation is defined as the expansion of the amount of money in circulation. Since Greenspan took over the Federal Reserve in 1988, the money supply has been consistently rising. Arguments can be made that the Dot-com/stock market crash of 2001 was due to money supply expansion of the 1990's. In response to that event and 9/11, the Fed slashed interest rates in 2001. This set the stage for more money creation, which has led to the currently deflating housing bubble, and a 7-year steady rise in commodity prices. Money supply growth rate is currently 17.5%, the highest rate in our history. People are feeling the pain of higher prices due to inflation.
The reason for escalating energy prices since last summer are not due to the reasons the Mayor gave last night, at least short-term. The reason is the devaluation of our money. On April 8th, 2008, OPEC Cheif Adbullah al-Badri remarked, "There is clearly no shortage of oil in the market." Still, "OPEC stands ready to act if the market shows a need for any further measures." OPEC Chief Chakib Khelil commented, "there is no link between price levels and supply, and inventories are already high." These OPEC officials are saying that present high petroleum prices are NOT due to supply shortages.
Al-Badri went on to say (and this is the important wording!), "The turmoil in some global equity markets and the considerable depreciation in the US dollar have encouraged investors to seek better returns in commodities, particularly in crude oil futures. This has driven prices higher."
Here it is again, ". . .the considerable depreciation in the US dollar . . . has driven (oil) prices higher."
This explains why we are seeing higher food prices, as well.
The Borough has declared a "state of emergency" because of higher energy prices. This misses the target. In reality, the stability of our money is in a state of emergency. This is due to Federal Reserve Bank and Federal Government actions which have massively inflated our money supply. This problem is beyond local scope, and citizens should direct their concerns toward the root cause. Public pressure needs to bear on our Federal officials to correct and stabilize our currency by reining in the Federal Reserve and haulting inflation.
There will be no energy crisis (now or later) if our elected representatives will allow the cheap energy available in Alaska, coal, to be used for to power our cities. Electric heat at 0.1 [$]/[kW Hr] is probably more affordable than the equivalent fuel-oil heat.
But throwing a bone to homeowners, Lowes, and Home Depot is the feel-good populist and gentrification approach. Renters clearly don't have problems paying their bills.
I wonder if the energy-efficient improvements will "improve" the property-tax appraisal.
Well said Kallenburg, oil is the #1 world commodity. In the 70's the oil spike was due to a shortage. When was the last time the gas station was out of fuel or limiting you to 10 gallons? We have brought this on ourselves through the globalization of our economy. We have sent our industry abroad and they no longer need us. As a nation we are now a credit liability and our dollar will soon be worth no more than the paper it is printed on.
As what point does Alaska decide to use our resources for domestic purposes? We can winterize all we want, but there is still a need for massive quantities of BTU's to survive in an arctic climate. The state is already bringing in more money than they know what to do with. At some point we are going to need to say enough is enough and make Alaska's resources available to the people.
How much do you pay the state for a king salmon? How much do you pay the state for a moose? What does it cost you to harvest some blueberries? These are all resources just like our oil. We should be paying what it costs to process the crude into heating oil and not what Wall Street speculators want to charge us.
the gas rationing in the 70s was not due to a shortage, it was due to government dabbling in command-control economy. Oil was "allocated" and prices fixed by our elected officials in a time of "crisis." Shortages and lines are the nearly-inevitable consequence of such action. Without command-control distribution, prices would rise and the distribution of a scarce resource would go to those willing to pay for it.
Funny how the domestic political aspect is often left out of the oil embargo history. The price to heat your home also has domestic political factors. Why are we not burning more coal?
Ah...! The Borough Assembly has plugged a crack on the dam with chewing gum? If they wanted to do anything about the problem, they would have lowered the already high property tax years ago. However, they would not do such thing because that would break their ballooning budget.
Also, while residents are trying to save some money by burning wood to heat their homes, what is the Assembly planning? Answer: more EPA restrictions on emissions from wood stoves and fireplaces!!
What Major and the Assembly should have done long ago was to work with Anchorage and gas companies to get natural gas to Fairbanks. It only costs around $250.00 per month to heat a house in Anchorage, while is costs around $600.00 to accomplish the same around Fairbanks.
We have seen the enemy, and he is us.....In typical fashion for we americans, we ignore problems and stick our heads in the sand until it is too late. NOW, all of a sudden and in a predictable fashion, with skyrocketing energy costs we see an emergency and demand prompt, dramatic government action. We have only ourselves to blame. We could have balanced energy self-sufficiency, economic growth, stewardship of our planet, more sustainable and enviorenmentally sound ways of living, etc. The government should have created economic and tax incentives to steer our society in that direction.
The people however only get from our politicians what we demand from them, and we had no interest in saving anything other than our own self interest. We should have long ago demanded a look to the future, and started transitioning to a more sustainable lifestyle. I am not talking about a few fancy light bulbs and carpooling, but real change. It will now be forced upon us. It would have been so much easier if we had started earlier.
You should have seen it coming, and you could have been part of the solution. The simple fact is there will not be enough energy to go around, and it will get worse. You ain't seen nothin yet.
Keep in mind that this is a local problem. Anchorage natural gas rates are going down 10% next month. Across the US natural gas costs have only increased 3-5%. The villages are paying more, but their infrastructure is not as dependent on heating oil. They can walk across town in 5 minutes and one room cabins can easily be heated with wood like they have been for hundreds of years.
Arcticracer how can you say that there is not enough energy to go around? $40 billion dollars worth of oil cross this borough each year. We are living in the middle of a corn field and starving because of our State energy policy.
Alaska, the land of the rugged and self-reliant individualist! When did the Alaska turn into a welfare state? So the high cost of energy is putting a hurt on a bunch of unprepared people. That is terrible but not a reason to start doling out public money. America is a land of freedom where we make our choices and live by them. If conditions get untenable in one place we're free to move to another, more hospitable place. If you can't find work that will pay your bills in Alaska then move to somewhere else. If you didn't take the necessary steps to secure your future (savings, education, etc.) then stand up and accept the consequences. I can understand why politicians insist on handing out public money lollipops to all the down-and-outs but why do all the hard working people who ultimately pay the price stand for it? To all you people with your hands out: do whatever it takes to rectify your situation but do it through your own efforts and stop asking for or accepting public money.
I'm not sure what you are paying for power in Fairbanks, but this week Gov. Palin rejected a disaster declaration for Juneau. Juneau's residential electrical rates went up 447% last month. And many homes in Juneau have electric heating. Try to imagine having to pay $8.00 a load to dry your laundry at home(remember it's usually raining in Juneau)
Aw, revel in your pain. Take heart that TAPS is moving less and less oil every year. Be thankful that there are no producing wells in either the National Petroleum Reserve or the 1002 area of ANWR. Be glad that Usibelli Coal is not producing any more coal than they already are. Count your blessings as you remember that the Susitna Dam was never built. Thank God for the environmental groups that file lawsuit after lawsuit to stop greedy energy producers from exploring and exterminating the caribou.
So stop complaining. We've worked very hard, paid a lot of money, and sacrificed a lot of good paying jobs to achieve this energy crisis. Rome wasn't destroyed in just one day, you know.
So if you earn more than $77,000 you're out of luck. Seems like everyone is effected by high heating oil/gas prices, maybe there should be some relief for the hard working families that earn over this amount.
Try finding this story in any other newspapers across the state. I guess that this is not even worthy of being reported.
Niceguy--
This story focuses on two AHFC programs. One, the free "weatherization," is limited to families making up to the median income, reported to be $77,700 for a family of four.
The other, the "rebates," is for anyone.
The link to AHFC's Web site I stuck at the bottom of the story will get you lots more information. Sorry if the story was unclear.
--Christopher Eshleman
Post a comment
Commenting requires registration.