Juneau -- Rep. Vic Kohring (R-Wasilla/Peters Creek) has unveiled a plan to wean Bush Alaska off government-subsidized diesel fuel (paid through the Power Cost Equalization Program) used to power electrical generating plants throughout Alaska. Kohring's proposal, dubbed the Rural Energy Fund, would establish a $100 million self-sustaining endowment from which dollars would be drawn to construct rural Alaska electrical-related infrastructure.

"My goal is two-fold", said Kohring. "First, it's to phase out the fuel subsidy that rural Alaska has become addicted to in recent years and instill the incentive to explore alternatives in energy, as well as eliminating the constant draw on the state's General Fund. Second, it's to give villages the means with which they can meet their energy needs through the development of alternative energy sources, construction of efficient power plants and an improved network of transmission lines".

The endowment's source would be the Alaska Science & Technology Foundation. ASTF's $100 million endowment would be used by the new Energy Fund, and projects would be funded from its earnings which currently run about $14 million a year. A portion of ASTF's current mission would remain intact, including education and technology funding to develop efficient power generation systems.

Kohring has presented his plan to both the House Majority Caucus and House Finance Committee. His plan is one of two before the Legislature. The other is by the Governor's Blue Ribbon Panel, that has suggested the Power Cost Equalization Program be funded through a "surcharge" paid by urban rate payers. Kohring said his plan was motivated in-part by the panel's recommendations. "It's nothing but a tax on my constituents", he said. "And it doesn't address long-term capital investment and creating self-sufficiency."

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