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HomeMy WebLinkAboutAK State Energy Program 1995MEMORANDUM STATE OF ALASKA Community and Regional Affairs TO:Jim Ayers DATE:October 4,1995 Chief of Staff FILE: THRU:Mike Irwin Commissioner PHONE NO:269-4641 FROM:Percy Fists SUBJECT:U.S.Department of Energy Director,Diviston of Energy Block Grant The U.S.Department of Energy anticipates that funding for two state energy programs,the Institutional Conservation Program (ICP)and State Energy Conservation Program (SECP),will be combined into a single block grant early next year.Governor Knowles will determine how block grant funds are used.I request that the block grant funds be allocated to the Division of Energy to continue our successful energy conservation activities. current Situati The Division of Energy administers the ICP,a $240,000 yearly grant program which provides matching funds to schools and hospitals for cost-effective energy conservation activities.The Division assumed the program from Alaska Housing Finance Corporation last year and has since strengthened the program substantially.Previously,funds were routinely turned back to the federal treasury.Currently grant applications total more than twice the available funds. Alaska Housing Finance Corporation administers the SECP,a $160,000 per year program and uses the funds for residential weatherization.Alaska Housing also receives $1.6 million per year for residential weatherization through the federally-funded Weatherization Assistance Program (WAP). Alternatives The new block grant is expected to provide about half of the combined funding levels of the ICP and SECP--approximately $200,000.Two alternatives for its allocation are: 1.Block grant to Alaska Housing Finance Corporation.This emphasizes residential weatherization. The Division of Energy's non-residential conservation program would largely be curtailed for lack of staff and grant funding. 2.Block grant to Division of Energy.This maintains valuable conservation programs at both agencies since Alaska Housing would continue to receive WAP funding.The Division of Energy retains the ability to expand the school and hospital conservation program through public and private financing. I request that the block grant funds be allocated to the Division of Energy.If this request is approved, please send a letter to the U.S.Department of Energy to this effect.I have enclosed a draft letter for your consideration. ce:Dan Sauske,Alaska Housing Finance Corporation October 4,1995 The Honorable Hazel O'Leary,Secretary U.S.Department of Energy 1000 Independence Avenue,S.W. Washington,D.C.20585 Dear Secretary O'Leary: My staff has informed me that reorganization of the U.S.Department of Energy will result in a number of federal grant programs being combined into a block grant known as the State Energy Program.This letter designates the Alaska Department of Community and Regional Affairs as the lead recipient of the State Energy Program for the State of Alaska. |understand that it will be several months before federal regulations are prepared which provide specific guidelines on conducting the new program.We look forward to a smooth transition into the new program and a continued close relationship with the Department of Energy. Sincerely, ayers.doc Tony Knowles Governor CC:Mike Irwin,Commissioner,Department of Community &Regional Affairs Percy Frisby,Division of Energy,Dept.of Community &Regional Affairs ayers.doc MEMORANDUM STATE OF ALASKA Community and Regional Affairs TO:Mike Irwin DATE:October 4,1995 Commissioner FILE: THRU: PHONE NO:269-4641 FROM:Percy rayGg SUBJECT:U.S.Department of Director,Division of Energy Energy Block Grant Here is more detail on the issues raised in the attached memorandum to Jim Ayers regarding the federal State Energy Program (SEP)block grant.As you know,I am requesting the block grant be allocated to the Division of Energy to continue our energy conservation program. Situati The Division of Energy administers the Institutional Conservation Program (ICP),a $240,000 yearly grant program which provides matching funds to schools and hospitals for cost-effective energy conservation activities. The Division assumed the program from Alaska Housing Finance Corporation (AHFC)last year and has since strengthened the program substantially.Previously, funds were routinely turned back to the federal treasury.Due largely to our effort grant applications currently total more than twice the available funds.We plan to expand the program using public and private financing. One Division position is supported 100%by the current grant.The employee is a specialist in energy conservation,has years of experience in this area,and is a mechanical engineer.The Division is unable to support this position without the federal funding. A summary of new grant activity: INSTITUTION GRANT PROJECT Kodiak Island Borough Hospital $36,079 Energy management system,hi-eff.lighting,etc. Chatham School District $29,664 Hi-eff.lighting,hi-eff.motors,etc. Mt.Edgecumbe High School $2,232 Energy audit report on one school building Sitka Community Hospital $88,011 Direct digital control system,hi-eff.lighting,etc. University of Alaska-Anchorage $33,724 Energy audit reports on four campus buildings e AHFC administers the SECP.a $160,000 per year program and uses the funds for residential weatherization.In addition.Alaska Housing receives $1.6 million per vear for residential weatherization through the federally-funded Weatherization Assistance Program (WAP). e Because of the economics of scale and the complexity of the equipment used in larger buildings.energy conservation in non-residential buildings is much more cost- effective than in houses.It also benefits a broader spectrum of Alaskans,since everyone uses schools and hospitals but not all Alaskans can afford a house. tiv The new block grant is expected to provide approximately $200,000.Two alternatives for its allocation are: 1.Block grant to Alaska Housing Finance Corporation.This emphasizes residential weatherization.The Division of Energy's school and hospital energy conservation program would effectively be eliminated by the loss of grant funding. 2.Block grant to Division of Energy.This maintains valuable energy conservation programs at both agencies,since AHFC would continue to receive WAP funding.The Division of Energy would retain the ability to fund school and hospital energy conservation.In addition,the Division is working toward leveraging more conservation activity by using grant funds to buy down the interest rates on energy conservation financing.This type of low or zero interest financing of energy conservation activity has proven to be very successful in other states.Energy efficiency improvements at schools and hospitals result in reduced operation costs, new equipment,and more employment opportunities for Alaskans. Please contact me if I can provide more detail on this proposal.