Hoonah hydro project cuts energy bills for local businesses

Alaska’s newest hydro power project has been generating electricity since the beginning of August, but it only recently had its ribbon cutting ceremony. The city of Hoonah is cutting diesel consumption by about a third which could help the local economy.

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Water flows down the tube and spins a turbine that creates electricity. (Photo by Elizabeth Jenkins/KTOO)
Water flows down the tube and spins a turbine that creates electricity. (Photo by Elizabeth Jenkins/KTOO)

At the Gartina Falls hydro project, curious locals and lawmakers gathered to see how Hoonah will cut its diesel use by 30 percent. For years, diesel was the only option to power the village.

Paul Berkshire, the engineer, points to a structure near the falls that looks like a dilapidated log cabin.

“This is the original attempt to build hydropower here. As near as I can tell, somewhere around 1926,” he said.

Unfortunately, that plan didn’t work but a $10.5 million grant–mostly from the state–made it possible to get the new project up and running. It’s already saved 3,600 gallons of diesel and is expected to save up to 100,000 in a year.

The remnants of an old hydro energy project. (Photo by Elizabeth Jenkins/KTOO)
The remnants of an old hydro energy project. (Photo by Elizabeth Jenkins/KTOO)

“Basically if you can get anything to spin, you can produce electricity from it.”

On one side of the falls is a stagnant pool that creates pressure. The water flows down a long tube and turns a turbine, similar to a water wheel, and electricity is generated.

The developer is the Inside Passage Electric Cooperative, which supplies energy to small Southeast communities: Angoon, Klukwan, Kake, the Chilkat Valley and Hoonah.

Jodi Mitchell, the  cooperative’s CEO, says when she started working there in 1993, the price of diesel was about 79 cents a gallon.

“Over my career at IPEC, we’ve seen prices go as high as $4.25 a gallon and that’s a wholesale bulk rate that we pay,” says Mitchell.

It’s now close to $3 a gallon but most residents don’t pay for it all in their monthly energy bill. A state program called power cost equalization tries to subsidize rural rates down to urban rates.

“The businesses in the community don’t qualify for that. Because the power cost equalization only pays for residential accounts … and that leads to a whole host of problems,” Mitchell says.

Mitchell says you can see this reflected in the price for milk or a loaf of bread in Alaska’s remote communities and the high costs of energy could deter economic growth.

Ken Skaflestad, the mayor of Hoonah, says the community has become comfortable with diesel.

“We know a lot about it. We’re very experienced in it,” he says.

The project was supported by the City of Hoonah, Sealaska Corp., Huna Totem Corp. and the Hoonah Indian Association. (Photo by Elizabeth Jenkins/KTOO)
The project was supported by the City of Hoonah, Sealaska Corp., Huna Totem Corp. and the Hoonah Indian Association. (Photo by Elizabeth Jenkins/KTOO)

The village of 750 has investor interest from outside. There’s a new microbrewery in town and a cruise ship dock under construction could bring in more tourists.

“For people who would love the lifestyle here but don’t dare take the risk due to the high cost of electricity, they now know they have support, that they have people behind them that know of their struggle and respond to it,” Skaflestad says.

Jodi Mitchell says for local businesses paying for electricity, the 30 percent could be huge. She hopes with the state’s budget crunch, projects like this will continue to be prioritized and funded.

“I am so proud of what we were able to accomplish here in Hoonah, and I’d hate to see that stop,” Mitchell says.

She says it might take longer for Gartina Falls to offset the price of electricity for Hoonah residents. A sister hydro project is planned for Water Supply Creek.