Alaska gets millions of dollars from Volkswagen settlement

The logo on a Volkswagen Golf R32 at the Scottish VAG Show 2013 held in Scotland. (Creative Commons photo by p&p photo)

The state of Alaska is receiving over $8 million in settlement money after a top car company cheated on its federal emissions tests. Volkswagen sold more than 500,000 diesel-powered cars nationwide between 2009 and 2016. And those cars were equipped with so-called “defeat devices,” or software that masked actual emissions when tested.

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The governor’s office has appointed the Alaska Energy Authority (AEA) to help administer the state’s share of the settlement.

“This is just another way to leverage some of that improvement that’s needed in rural Alaska,”  Sean Skaling, an energy policy director at AEA, said.

Skaling said the types of projects that can be funded are defined in the settlement, including improving emissions for transit buses, ferries and boats. That could mean replacing diesel engines with fully electric or hybrid ones.

Additionally, the money can also be used to upgrade energy infrastructure in remote villages.

The agency is taking public comments to help prioritize the most effective projects. The final plan is expected to be completed in the fall.

Skaling said this $8 million is different from the Volkswagen buyback program and settlement money that’s being doled out nationwide.

Outside of what the state is receiving, the settlement includes nearly $54 million for federally recognized tribes.

“One role that AEA can play here is we can help bring together whole regions, tribes within regions, for example, to leverage other funding and to make the most of the funding that is available,” Skaling said.

The U.S. Department of Justice will be administering the tribal allocation. Skaling expects the deadline to submit a plan for that will be Sep. 1.