Sen. Murkowski welcomes proposed method for calculating land use fees for Alaska hydropower plants

U.S. Sen. Lisa Murkowski (R-AK) applauded a recent proposal by the Federal Energy Regulatory Commission (FERC) to change the way that annual land use charges are calculated for hydropower projects on federal lands.

FERC’s proposed method would use a regional per-acre land value to a statewide average per-acre land
value, which would reduce recent fee increases. FERC is currently seeking comment on its proposal.

“FERC’s proposal is a step in the right direction for Alaskans served by utilities that generate clean hydroelectric power from facilities on federal lands,” Murkowski said. “This new methodology recognizes the uniqueness of land valuation in Alaska, and will help ensure reasonable rates while removing a growing impediment to development in our state.”

In 2016, land use fees for hydroelectric projects on the Kenai Peninsula increased by 71 percent, according to Murkowski. Since 2008, fees for the region have increased by 384 percent. Land use charges for the Solomon Gulch project near Valdez have increased 679 percent since 2008.

Murkowski has said that the current rule violated the Federal Power Act, which requires land use fees to be “reasonable.”

If the proposal is confirmed, it would effectively roll back land use charges for most of the hydropower projects that operate on federal land in Alaska and reduce land use payments for 13 of the state’s 15 state utilities that operate hydropower facilities.