Alaska’s new governor axes Susitna Dam from budget

by Sam Snyder

Wild salmon lovers got an early Christmas present this week. Alaska’s new governor on Monday cut proposed funding for a controversial hydroelectric project on one of the state’s most productive salmon rivers.

Two months ago, I wrote this blog post about fishing the Susitna River, Alaska’s 4th largest king salmon fishery. More importantly I outlined the threats posed by a  proposal to build America’s second tallest dam at the mid-point of the river, putting the river, the fishery, and an economy of over 5,000 jobs valued at over $200 million annually. Trout Unlimited’s Alaska Program has worked with partners over the past 2 and a half years to raise awareness about the ecologic and economic costs of the proposed Susitna dam and to argue for nixing the project. 

Monday’s news that Gov. Bill Walker’s capital budget removes $20 million in proposed funding to advance the dam project came on the heels of a report TU and  campaign partner the Susitna River Coalition released last week by longtime Alaska economist Gregg Erickson.  The report   underscored the economic costs and risks posed by the Susitna dam, concluding that the main project’s proponent, Alaska Energy Authority (AEA), grossly  underestimates the cost, and overestimates the needs and benefits of the dam.

While already an exorbitant  $5.2 billion, AEA’s projected price tag for the Susitna dam project fails to include $880 million in  required costs to move power from the dam to existing transmission lines. The estimate also excludes yet-to-be negotiated costs of leasing or purchasing of the Alaska Native corporation lands on which much of the project would  sit.

Most importantly, perhaps (for us fish folks), AEA has  failed to account for the costs of fisheries mitigation, including possible fish passage around the proposed 735-foot tall dam. And, as we know from experiences in the Pacific Northwest,  fisheries mitigation on dammed salmon rivers is difficult at best. In sum, Erickson argued, “the Susitna hydro project does not survive any plausible market test.” It also fails the fisheries test.

Erickson’s report comes as oil prices continue to slide, sending Alaska’s petroleum-dependent state budget toward a projected $3.5 billion deficit. In a bid to drastically curb state spending, Gov. Walker introduced a capital budget that’s about half the size of what his predecessor, Sean Parnell, had proposed. Still, with oil prices sinking to about 40 percent of what they were in July and hovering in the $60 a barrel range, Alaska appears to be heading toward turbulent fiscal waters. Given what lies ahead, mega-projects that don’t pencil out like the Susitna dam are appropriately being slashed.

This news does not mean the Susitna dam is completely dead, but it is a huge step in the right direction.  I applaud the Walker administration for both fiscal and fisheries responsibility. 

The budget he released Monday will be introduced in the legislature early next year, when state lawmakers will have the opportunity to make revisions. Once complete, the budget will go back to Walker’s desk, where he can make final revisions before signing it. Between now and April we will need to work diligently to ensure that state legislators don’t attempt to sneak funding back in t in exchange for one pet issue or another.

Since 2011, AEA has spent over $193 million on studies to advance the dam. In recent months those studies have also faced criticism, most notably because AEA scientists and consultants could not tell the difference between Chinook and Coho juveniles.  In their confusion, they called them ‘chinoho’! (Honestly, I’m not making this up.)

In the end, this project is does not remotely pass the ‘straight face’ test when it comes to fisheries, energy needs, or economics. Walker’s budget is a welcome relief. We’ll use the next year to move Susitna dam from the shelf to the garbage disposal.

Sam Snyder coordinates TU's Save the Susitna Campaign.