www.AlaskaAlliance.com 15 penalties affecting federal funds if it isn’t addressed. The community and the state Department of Environmental Conservation have been working with the EPA on a plan to be brought into compliance with federal air quality standards. Steps like a wood stove “changeout” program have been organized by the Fairbanks North Star Borough. Old, less efficient wood stoves have been traded in for modern, more efficient stoves, Stewart said. The same thing has been done with older oil-burning furnaces being exchanged for newer, cleaner, and more efficient ones. Natural gas appears the best solution and although not all parts of the Fairbanks area can be served by gas distribution systems many can be. The Interior Gas Utility, or IGU, the regional utility, is gradually expanding its distribution system with state financial help through the Alaska Industrial Development and Export Authority, the state’s development finance corporation. Fairbanks had a small, privately-owned gas utility for several years serving homes and businesses in the core community downtown, but a public utility was needed to expand the system and fully address winter air pollution. IGU was organized as a part of the Fairbanks North Star Borough. The state Legislature stepped in to fund its expansion through AIDEA, which continues to be involved. The newest development on local gas service, however, is that a new liquefied natural gas, or LNG, plant is being completed at Prudhoe Bay by Harvest Alaska, a Hilcorp Energy affiliate, which will make the large reserves of North Slope gas available to the Interior. The LNG will be transported by truck down the Dalton Highway just as LNG is now trucked to the Interior from a small gas liquefaction plant in the Matanuska-Susitna Borough north of Anchorage, which depends on Cook Inlet gas. Cook Inlet gas will be running short, however, but access to the North Slope now gives the Interior a security of supply it didn’t have previously, Stewart says. But while it is secure it won’t be cheap. Though the price of delivered fuel comes with a “convenience” premium against a lower price if customers haul their own, the rate tends to increase over the winter heating season as demand increases. Natural gas prices locally are currently in line with “haul your own” fuel. Sometimes oil is higher and sometimes lower. LNG trucked from the North will make gas a bit more expensive at times because of the trucking, but the advantages of having a secure supply of clean-burning fuel may outweigh that. There may be no escaping the burden of high heating costs in a cold climate, however. A new University of Alaska study estimates that Fairbanks residents pay about 10 percent to 12 percent of household income on energy, but Stewart thinks the burden might be higher. Housing is another seemingly intractable problem for Fairbanks, but in this case it’s a problem shared with many other Alaska communities. Rising costs of construction and materials and scarcity of labor play a part in this in Fairbanks along with high interest rates. “We’re not alone in this. Many communities share this problem,” Stewart said, and if solutions are developed elsewhere, they can be adopted in Fairbanks. One advantage for the Interior is the Cold Climate Research Center in Fairbanks, a nonprofit that develops new building and insulation techniques to make buildings more energy efficient. Systems developed at the cold climate center have been adopted by many local builders, Stewart said. — Tim Bradner Since before construction and in the many decades since, the Trans-Alaska Pipeline and the supporting industries serving it, remain the core of Fairbanks’ economy.
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