• Analysis of Alaska Transportation Sectors to Assess Energy Use and Impacts of Price Shocks and Climate Change Legislation

      Fay, Ginny; Schwörer, Tobias; Guettabi, Mouhcine; Armagost, Jeffrey (Institute of Social and Economic Research, University of Alaska Anchorage, 2013-04)
      We analyzed the use of energy by Alaska’s transportation sectors to assess the impact of sudden fuel prices changes. We conducted three types of analysis: 1) Development of broad energy use statistics for each transportation sector, including total annual energy and fuel use, carbon emissions, fuel use per ton-mile and passenger-mile, and cost of fuel per ton-mile and passenger-mile. 2) Economic input-output analysis of air, rail, truck, and water transportation sectors. 3) Adjustment of input-output modeling to reflect sudden fuel price changes to estimate the potential impact on industry output and employment. Alaska air transportation used approximately 1.9 billion gallons of fuel annually; 961 million gallons were used for intra-state and exiting Alaska flights. Water transportation used 101.8 million gallons annually, approximately 84.3 million gallons for intra-state and exiting segments. Railroad and truck transportation used 5.1 and 8.8 million gallons annually, respectively. Simulated fuel price increases resulted in an estimated $456.8 million in value-added losses to the Alaska economy through the increase in cost of transportation services, as well as an equivalent loss in income to Alaska household of $26.8 million. A carbon emissions tax would have the greatest impact on the cost of air transportation services followed by water, trucking and rail.
    • Anchorage Port Intermodal Expansion Program (PIEP) Benefit Cost Analysis of Proposed TIGER Discretionary Grant Funds

      Goldsmith, Oliver Scott; Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2009-09-04)
      The Port of Anchorage (POA) has exceeded its design life and has been operating beyond its capacity for a number of years. It is in need of replacement to both minimize operating costs and avoid potential damage in the event of an earthquake. It is in need of expansion to meet the needs of the growing South Central Alaska economy1. In response to these needs the POA has embarked on a multi-year expansion project—the Port Inter-modal Expansion Program (PIEP)2. In early 2009, in the midst of this expansion program, the federal government passed the American Recovery and Reinvestment Act. The Recovery Act appropriated $1.5 billion of discretionary funds to be awarded by the Department of Transportation for capital investments in surface transportation infrastructure (including ports) that would provide long-term economic benefits as well as preserve and create jobs and promote economic recovery3. In support of its request for a “Grant for Transportation Investment Generating Economic Recovery” (TIGER Grant), the POA asked the Institute of Social and Economic Research (ISER) to prepare a Benefit-Cost Analysis (BCA) demonstrating the long term economic benefits that would flow from expenditure of grant funds in support of the PIEP. This BCA follows the guidelines set forth in the Federal Register notice announcing the TIGER grant program. It measures the increase in national income that would result from the expenditure of the grant funds in support of the PIEP. Since the POA funding request would pay only a portion of the cost of the entire PIEP, this BCA is limited to measuring the benefits from the expenditure of the TIGER grant funds rather than the total benefits of the entire PIEP.
    • Attitudes towards land use and development in the Mat-Su: Empirical evidence on economic values of ecosystem services

      Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2014-04-25)
      In communities that largely depend on the extraction of natural resources, attitudes towards conservation and development may seem at odds or particularly rigid. With an unprecedented wealth of natural capital, a growing mining sector, strong oil and gas industry, and a politically conservative population, Alaska serves as a case study to measure such attitudes. This research was motivated by a lack of primary ecosystem service valuation studies in Alaska that could be used to assess the public’s perceived value of ecosystem services in order to guide future land use decisions and incentivize land use decisions that minimize negative externalities. A choice experiment was conducted with 224 households in the Matanuska-Susitna Borough, the fastest growing region in Alaska and one of the fastest growing regions in the U.S. Rapid development with few restrictions has led to changes for local ecosystems particularly important to salmon, negative effects on access related to recreation and tourism, and caused conversion of valuable farmland. Study results show that attitudes and values vary regarding future land use and economic development efforts. On average, policy action to improve conditions for local salmon stocks are most valuable to local residents followed by protecting farm and ranch lands as well as public access to recreation sites. Conversely, residents show negative preferences towards rapid population growth and developing local mining, oil and gas, and timber resources but support developing a professional and technical services sector. The quantified welfare changes related to different development scenarios show that focusing on conserving valuable ecosystem services is in the public’s best interest.
    • Economic Feasibility of North Slope Propane Production and Distribution to Select Alaska Communities

      Schwörer, Tobias; Fay, Ginny (Institute of Social and Economic Research, University of Alaska Anchorage, 2010-06)
      Could propane from Alaska’s North Slope reduce energy costs for electric utilities and residential space heating, water heating, and cooking demands? We explored the hypothesis that propane is a viable alternative for fourteen selected communities along the Yukon and Kuskokwim Rivers, coastal Alaska, and Fairbanks. Our analysis forecasts propane and fuel prices at the wholesale and retail levels by incorporating current transportation margins with recent analysis on Alaska fuel price projections. Annual savings to households associated with converting to propane from fuel oil can be up to $1,700 at $60 per barrel (bbl) of crude oil, and amount to $5,300 at $140 per barrel.1 Fairbanks residents would benefit from switching to propane for all applications at crude oil prices of $60/bbl. Interesting to note is that switching to propane for domestic water heating makes more sense at lower oil prices than conversions for home space heating. Three of the fourteen communities are projected to benefit from switching to propane for home heating at crude oil prices greater than $80 per barrel, and four communities at crude oil prices of more than $110/bbl. On the other hand, nine communities would benefit from conversion to propane for water heating as crude oil prices reach $50 and above. The realized household savings are also sensitive to assumptions surrounding the operating cost of the production facility and barge transportation delivery costs.
    • Economic Importance of Sportfishing in the Matanuska-Susitna Borough

      Colt, Steve; Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2009-08-31)
      We have estimated the economic benefits of sport fishing activity occurring within the Matanuska-Susitna (Mat-Su) Borough, using data from year 2007. Our estimates are based on the recent study entitled, Economic Impacts and Contributions of Sportfishing in Alaska, 2007. 2 It contains estimates of angler spending patterns within three regions: Southcentral, Interior, and Southeast. We also used year 2007 data from the ADFG annual Statewide Harvest Survey (SWHS).3 These data allow us to allocate economic benefits to the Mat-Su Borough.
    • The Foraker Group Report on the Alaska Nonprofit Economy: 2010 Update

      Goldsmith, Oliver Scott; Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2010-11)
      A report on the economic importance of Alaska’s nonprofit sector conducted by the Institute of Social and Economic Research University of Alaska Anchorage
    • Managing Invasive Species: How Much Do We Spend?

      Schwörer, Tobias; Federer, Rebekka; Ferren, Howard; Alaska SeaLife Center (Institute of Social and Economic Research, University of Alaska Anchorage, 2012-07)
      Invasive species: they’re along roadways and up mountain trails; they’re in lakes and along the coast; chances are they’re in your yard. You might not recognize them for what they are—plants or animals not native to Alaska, brought here accidentally or intentionally, crowding out local species. This problem is in the early stages here, compared with what has happened in other parts of the country. But a number of invasive species are already here, and scientists think more are on the way. These species can damage ecosystems and economies—so it’s important to understand their potential economic and other effects now, when it’s more feasible to remove or contain them. Here we summarize our analysis of what public and private groups spent to manage invasive species in Alaska from 2007 through 2011. This publication is a joint product of ISER and the Alaska SeaLife Center, and it provides the first look at economic effects of invasive species here. Our findings are based on a broad survey of agencies and organizations that deal with invasive species.1 The idea for the research came out of a working group formed to help minimize the effects of invasive species in Alaska.2 Several federal and state agencies and organizations funded the work (see back page).
    • The Mat-Su Borough in 2040: What Would Residents Like to See?

      Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2014-04)
      Many residents of the Mat-Su Borough were attracted to the area by its rural character: low-density population, salmon streams, opportunities for recreation and hunting in undeveloped areas, and food produced by local farmers. With rapid population growth, these characteristics have been changing, and they will likely continue to change without policies to maintain or restore them. But residents can influence such change, by letting policymakers know what they value. What do Mat-Su residents want their area to look like in 2040? What value do they place on rural character and recreation opportunities? What would they be willing to pay to maintain or restore those characteristics? These are important questions for people in the borough, which borders Anchorage on the north. It has for decades been the fastest-growing area in Alaska, with a current population five times what it was in 1980.
    • Port of Anchorage TIGER II BCA Model

      Goldsmith, Oliver Scott; Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2011-08-17)
    • Power Cost Equalization Funding Formula Review

      Fay, Ginny; Meléndez, Alejandra Villalobos; Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2012-03)
      The purpose of this study is to examine the current Power Cost Equalization (PCE) program formula’s impacts on incentives for implementation of energy efficiency and renewable energy measures. In addition, it examines if alternative formula structures might improve market signals that are more conducive to investment in energy efficiency and renewable energy in rural Alaska. As part of the analysis we also present information on the history of the PCE program and levels and patterns of electricity consumption across regions of Alaska. Alaska has large regional and intra-regional differences in energy consumption and prices that result from a number of factors including proximity to different types and quantities of resources, community population, remoteness, and transportation costs. Most communities in rural Alaska depend on volatile and high priced fossil fuels for the generation of electricity, space heating and transportation. The Alaska statewide weighted average residential rate for electricity (17.6 cents per kWh in CY2011) is substantially higher than the U.S. average of 11.8 cents per kWh (U.S. EIA, 2012). Yet in Alaska the average residential rate per kWh is currently lower than in Hawaii (34.5 cents), New York (18.4 cents) and Connecticut (18.1 cents). Hidden in the Alaska statewide average is considerable variation with some communities paying less than the national average and some—generally those least able to afford it—paying among the highest in the country. The Railbelt and Southeast regions have the lowest average residential electric rates (Appendix I map). North Slope residential customers also have lower average rates because of access to natural gas and North Slope Borough energy payments in addition to PCE disbursements. Most other regions have rates two to three times as high as Alaska urban rates. Some communities with hydroelectric power have notably low rates but customers are not paying the full, true cost of power because the cost of construction was heavily subsidized by state and federal governments. In Table 3 (p. 20) we present average annual residential electricity consumption and rates for different regions of Alaska.
    • Socioeconomic Impacts of Potential Wishbone Hill Coal Mining Activity

      Colt, Steve; Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2010-06-11)
      The purpose of this study is to assess some of the significant socioeconomic effects of potential coal mining activity at Wishbone Hill. The analysis scenario assumes a 16-year period of startup and mine production using two known deposits that are currently permitted by the State of Alaska for mineral exploration. “Mine Area 1” would be mined during years 2-7 and “Mine Area 2” would be mined during years 8-16. Mining would only take place at one of these areas during any given time. We considered four kinds of effects: Jobs and income, fiscal impacts, property values, and traffic.
    • Wind-Diesel Systems in Alaska: A Preliminary Analysis

      Fay, Ginny; Keith, Katherine; Schwörer, Tobias (Institute of Social and Economic Research, University of Alaska Anchorage, 2010-06)
      Most remote rural communities in Alaska use diesel to generate electricity. But the recent rapid development of a worldwide commercial wind industry, along with the rise in diesel fuel prices, has increased interest in wind power in rural Alaska—both to reduce energy costs and to provide local, renewable, sustainable energy. Wind is abundant in Alaska, and a growing number of rural communities are building winddiesel systems, integrating wind into isolated diesel power plants. These systems have moved from the initial demonstration phase a decade ago toward a technology available for many communities. Even in places that have not yet added wind, some rural utilities are planning for the possibility. For example, Alaska Village Electric Cooperative (AVEC) has committed to making new diesel power plants “wind ready” by designing its electrical systems so that wind turbines can be incorporated in the future without major reconfiguration. But it is not clear under what rural Alaska conditions wind-diesel systems are more economical than conventional diesel plant operations. The Alaska Energy Authority asked the Institute of Social and Economic Research (ISER) and the Alaska Center for Energy and Power (ACEP) to assess the performance of existing rural wind-diesel systems. We analyzed data available for existing wind-diesel systems as of spring 2010. Keep in mind that our analysis is preliminary; most rural wind-diesel systems are very new, and more time is needed to evaluate them fairly. Only three wind systems (Kotzebue, Wales, and Saint Paul Island) have been operating for more than a few years. Initial funding for the Kotzebue and Wales projects came from the U.S. Department of Energy, which funds research but does not subsidize utility operations. These early projects, built in the late 1990s, faced problems but demonstrated there is hardware that can operate in arctic environments. The Saint Paul village corporation funded the system on the island; it provides power for an industrial complex and airport the corporation owns. It is a high-performing system, and the most successful of the early demonstration systems, as measured by its capacity factor. However, it should be noted that both the Kotzebue and Wales systems have provided valuable experiences and lessons learned while integrating wind on a community-scale grid. Beginning in 2004, the Denali Commission funded projects in five communities (Selawik, Hooper Bay, Kasigluk, Savoonga, and Toksook Bay). In 2008, the Alaska Legislature created the Renewable Energy Fund, a competitive program intended to invest in renewable energy. That fund, which is administered by the Alaska Energy Authority, paid for construction of six projects listed as completed in spring 2010.